EXHIBIT 10.1
AGREEMENT OF PURCHASE AND SALE
VICON INDUSTRIES, INC., a New York corporation, hereinafter referred to
as "Purchaser," agrees to purchase, and RREEF MIDAMERICA/EAST-V NINE, INC., a
Delaware corporation, hereinafter referred to as "Seller," agrees to sell, that
certain improved real property, hereinafter referred to as the "Real Property,"
situated in the City of Hauppauge, Suffolk County, State of New York, consisting
of the Real Property, legally described on Exhibit A attached hereto and made a
part hereof, commonly known as 89 Arkay Drive, Heartland Executive Park,
Hauppauge, New York, an industrial building (the "Building") containing
approximately 56,000 rentable square feet in aggregate, on lots aggregating
approximately 5.07 acres all rights, privileges, easements and appurtenances
thereto, including any and all mineral rights, development rights, air rights,
all right, title and interest of Seller, if any, in and to the land lying in the
bed of any street or highway in front of or adjoining the land to the center
line thereof and to any unpaid award for any taking by condemnation or any
damage to such land by reason of a change of grade of any street or highway, and
the like. Also included is all personal property owned by the Seller and located
on or used in conjunction with the Property; any and all intangible personal
property owned and used in the operation of the Property (the "Personal
Property"), including the right to use the name of the property (but not the
name "RREEF"), to the extent assignable; contract rights, lease rights, all
licenses, permits and other written authorizations necessary for the use,
operation and ownership of the Property, records, security deposits and prepaid
rent, if any, and the benefit of any guaranties of the leases. All of the
foregoing Real Property and Personal Property is hereinafter referred to as the
"Property".
1. Purchase Price. The purchase price for the Property ("Purchase Price") shall
be Three Million Three Hundred Nineteen Thousand Five Hundred Dollars
($3,319,500.00), payable by wire transfer of funds at Closing (as defined
below).
2. Deposit.
2.1 Within one (1) business day after acceptance hereof by Seller and Purchaser,
Purchaser shall deposit the amount of $150,000.00 (the "Deposit") with Seller's
attorney, the firm of D'Ancona & Pflaum ("Escrow Holder"), as earnest money to
secure Purchaser's performance hereunder. The Deposit may be invested at the
direction of Purchaser with the approval of Seller. All interest payable with
respect to the Deposit, less investment fees, if any, shall be added to and
become a part of the Deposit and shall be applied toward the Purchase Price if
closing is completed in accordance with this Agreement; otherwise all interest
shall be paid to the party entitled to the Deposit. The escrow instructions to
Escrow Holder shall be in the form of Schedule 2.1 attached hereto. Purchaser
acknowledges that Escrow Holder is Seller's attorney, and that Purchaser, having
been advised by counsel, has consented to Escrow Holder acting as escrow holder
despite also being Seller's attorney. Escrow Holder shall not be liable for any
action with respect to the Deposit taken in good faith, without gross negligence
and not in wilful disregard of this Agreement, any such liability hereby being
waived by Purchaser and Seller. Without limiting the generality of the
foregoing, Purchaser and Seller authorize and direct Escrow Holder to accept,
comply with, and obey any and all writs, orders, judgments or decrees entered or
issued by any court with or without jurisdiction; and in the case Escrow Holder
obeys or complies with any such writ, order, judgment or decree of any court, it
shall not be liable to any of the parties hereto or any other person by reason
of such compliance. In case Escrow Holder is made a party defendant to any suit
or proceedings regarding the Deposit, Purchaser and Seller, jointly and
severally, agree to pay to Escrow Holder, upon demand, all costs, reasonable
attorney's fees, and expenses incurred with respect thereto. If said costs, fees
and expenses are not paid, then Escrow Holder shall have the right to reimburse
itself out of the Deposit. Purchaser agrees and consents that the firm of
D'Ancona & Pflaum shall not be disqualified from representing Seller in any
litigation or other proceeding arising out of this Agreement, whether or not
related to the Deposit, merely due to its acting as Escrow Holder hereunder;
provided, however, that prior to undertaking any such representation, D'Ancona &
Pflaum shall cause the Deposit to be deposited with the court or a new third
party escrow holder acceptable to Purchaser and Seller.
3. Review of the Property. Upon its execution of this Agreement, Seller shall:
3.1 Subject to the provisions of Section 8.15 hereof, provide Purchaser and
its agents or consultants with access to the Property to inspect each and every
part thereof to determine its present condition and to conduct such physical and
environmental studies (including a mechanical and roof study) as Purchaser deems
appropriate.
3.2 Deliver to Purchaser copies of those documents and items listed in
Exhibit B. By executing this Agreement, Purchaser acknowledges receipt of all of
such items.
3.3 Purchaser shall have the period of thirty (30) days (the "Review
Period") commencing on the date that a fully executed copy of this Agreement is
delivered to Purchaser ("Effective Date") to determine in its sole discretion
whether all matters relating to the Property (other than title and survey, which
are governed by Paragraph 4) are acceptable and whether it can obtain financing
in connection with the purchase of the Property. If Purchaser shall conclude
that any matter relating to the Property is not acceptable or Purchaser fails to
obtain an unconditional financing commitment for a loan in relation to the
Property in the amount of eighty percent (80%) of the Purchase Price, Purchaser
shall so notify Seller in writing prior to the expiration of the aforementioned
period (which notice shall contain a copy of Purchaser's environmental report
(if requested by Seller), roof/structural report and other reports or studies
obtained in connection with Purchaser's due diligence, and a specific statement
as to the conditions found to be unacceptable; however, the following shall not
be construed to limit or qualify Purchaser's absolute right to terminate this
Agreement if it does not determine that all matters relating to the Property are
acceptable), and this Agreement shall terminate without liability on the part of
Seller or Purchaser, other than Purchaser's indemnity contained in Paragraph
8.15 hereof, and the Deposit plus interest shall be returned to Purchaser. In
the event that Purchaser does not timely so notify Seller, Purchaser shall be
deemed to have concluded that the condition of the Property is acceptable, to
have obtained financing for the Property and to have elected to proceed with the
transaction upon the terms and conditions contained herein. Notwithstanding
anything in the foregoing to the contrary, Purchaser acknowledges that it is
aware that the roof requires replacement, and that Purchaser shall have no right
to either terminate this Agreement nor seek a price reduction based on the
condition of the roof.
3.4 Within five (5) days after execution and delivery of this Agreement by
both parties, Seller shall deliver or make available, at Seller's New York
office as listed in Section 8.4 of this Agreement, to Purchaser true copies of
the following documents, to the extent same are in the possession of Seller or
any Affiliate of Seller: all environmental reports, audits, and studies
concerning the Real Property, including but not limited to all reports, audits,
and studies identifying underground tanks, contamination of the soil or
groundwater of the Real Property with Hazardous Materials (hereinafter defined);
all correspondence with governmental authorities concerning the existence of
Hazardous Materials at the Real Property (all of the foregoing are collectively
referred to as the "Environmental Reports"). Seller does not warrant the
accuracy of any information contained in such Environmental Reports. The term
"Affiliate" shall mean any person or entity that controls, is under the control
of, or is under common control with Seller.
3.5 Purchaser agrees that any information obtained by Purchaser or its
authorized agents in the conduct of its due diligence will be treated as
confidential pursuant to Section 8.17.
4. Title and Survey.
4.1 Upon execution and delivery of this Agreement by both parties,
Purchaser shall order (and upon receipt, promptly deliver copies to Seller), a
commitment for an ALTA Owner's title insurance policy on the Real Property from
Chicago Title Insurance Company (the "Title Insurer"). If Purchaser requires a
survey of the Real Property, it shall obtain same, from a surveyor reasonably
acceptable to Seller, not later than thirty (30) days after the Effective Date,
provided that Purchaser shall not be obligated to use an updated version of the
existing survey for the Property. No later than the end of the Review Period,
Purchaser shall notify Seller in writing of any objection Purchaser may have to
any exceptions reported in the title report or any matter shown on the survey.
At the Closing, Seller shall convey and Purchaser shall accept fee simple title
to the Real Property, subject only to: (a) the matters set forth in Exhibit D
attached hereto (the "Permitted Exceptions"); and (b) such other matters as (i)
the Title Insurer shall be willing, without special premium, to omit as
exceptions to coverage or to except with insurance against collection out of or
enforcement against the Real Property and (ii) shall be accepted by the lender
which has committed in writing to provide mortgage financing to Purchaser for
the purchase of the Real Property (the "Lender"). If the aggregate cost of
removing any objections made by Purchaser to title or survey (the "Title
Clearance Costs") plus the Violation Clearance Costs (as hereinafter defined)
shall exceed $15,000 , Seller shall not be required to remove such objections if
Seller so advises Purchaser in writing within ten (10) business days of Seller's
receipt of Purchaser's notice of objections. Notwithstanding the provisions of
the foregoing sentence, Seller shall remove all objections relating to (1) real
estate taxes, water, and sewer charges to the extent they are for periods prior
to the Commencement Date of the Lease (hereinafter defined), and (2) any
mortgage placed upon the Real Property by Seller, or to which Seller has taken
the Real Property subject and with knowledge. Upon receipt of such notice,
Purchaser may elect either to (1) terminate this Agreement, in which event the
Deposit shall be promptly refunded to Purchaser and Seller shall reimburse
Purchaser for one-half of both the Title Insurer's charges and the costs
incurred by Purchaser to update or obtain a new survey (as the case may be) or
(2) close on the purchase of the Property, in which event the Purchase Price
shall be reduced by $15,000 (the "Title Clearance Credit"). If Seller elects to
terminate this Agreement as provided above, this Agreement shall terminate upon
Purchaser's receipt of the Deposit and such reimbursement.
4.2 At the Closing, the Personal Property shall be free and clear of all
liens and encumbrances.
4.3 Except for Excluded Violations (hereinafter defined), all notes or
notices of violations of law or governmental ordinances, orders or requirements
which were noted or issued prior to the date of this Agreement by any
governmental department, agency or bureau having jurisdiction as to conditions
affecting the Property and all liens which have attached to the Real Property
prior to the closing pursuant to any applicable governmental ordinances, orders
or requirements shall be removed or complied with by Seller. If the reasonably
estimated aggregate cost to remove or comply with any violations or liens which
Seller is required to remove or comply with pursuant to the provisions of this
Paragraph (the "Violation Clearance Costs"), plus the Title Clearance Costs,
shall exceed $15,000, Seller shall have the right to cancel this Agreement, in
which event the sole liability of Seller shall be to refund to Purchaser the
Deposit and to reimburse Purchaser for one-half of both the Title Insurer's
charges and the costs incurred by Purchaser to update or obtain a new survey (as
the case may be); unless Purchaser elects to accept title to the Property
subject to all such violations or liens, in which event Purchaser shall be
entitled to a credit of an amount equal to $15,000, less the Title Clearance
Credit, against the monies payable at the Closing. "Excluded Violations" consist
of violations which Purchaser, as tenant under the Lease, is required to remove
or comply with pursuant to the terms of the Lease by reason of Purchaser's use
or occupancy. If required, Seller, upon written request by Purchaser, shall
promptly furnish to Purchaser written authorizations to make any necessary
searches for the purposes of determining whether notes or notices of violations
have been noted or issued with respect to the Property or liens have attached
thereto.
5. Representations and Warranties.
5.1 Representations and Warranties of Seller. As used in this Section 5.1
and elsewhere in this Agreement, the phrase "to the knowledge of Seller" or
phrases of similar import shall mean and be limited to the actual knowledge of
Seller's portfolio manager (Pamela Boneham) and Seller's local management
personnel having ongoing management responsibility with respect to the Property,
namely (Alane Berkowitz), without investigation, and not to any constructive
knowledge of any of the foregoing individuals or of Seller or any investment
advisor to Seller, any entity that is a partner in Seller or such investment
advisor, or any affiliates of any thereof, or to any officer, agent,
representative, or employee of Seller or such investment advisor, any such
constituent partner, or any such affiliate. Seller hereby warrants and
represents to Purchaser (with such representations and warranties to be re-made
as of closing pursuant to Section 7.6.7) as follows: 1.1
5.1.1 Pending Proceedings. To the knowledge of Seller, Seller has received
no written notice of special assessments, condemnation, environmental, zoning or
other land use regulation proceedings either pending or planned to be instituted
with respect to the Property or any part thereof.
5.1.2 Status of Seller and Closing Documents. This Agreement has been, and
all the documents to be delivered by Seller to Purchaser at Closing are or will
be, duly authorized, executed, and delivered by Seller, will be sufficient to
convey insurable title and are legal, valid, and binding obligations of Seller,
are or will be enforceable in accordance with their respective terms, and do not
and will not at Closing violate any provisions of any agreement to which Seller
or the Property is subject.
5.1.3 Non-Foreign Status. Seller is not a "foreign person" within the
meaning of Section 1445(f)(3) of the Internal Revenue Code of 1986, as amended,
and that Seller will furnish to Purchaser, prior to Closing, an affidavit in
form satisfactory to Purchaser confirming the same.
5.1.4 Compliance with Laws. Seller has received no governmental notice, not
heretofore corrected and discharged, or which Seller is in the process of
correcting and discharging, alleging that the Property or its current uses are
in violation of any zoning, building, health, traffic, environmental, flood
control or all other applicable rules, regulations, codes, ordinances, or
statutes of any local, state and federal authorities and any other governmental
authority asserting jurisdiction over the Property, and has no knowledge of any
such current violation.
5.1.5 Service Contracts. To Seller's knowledge, there are no agreements or
contracts affecting the Property as to which Seller is the contracting party
(including, without limitation, any management, leasing, services or maintenance
agreements) which are not terminable at will by Seller without further
liability, upon not more than 30 days' prior written notice. Seller has provided
Purchaser with true and correct copies of all such Service Contracts, which
contracts are listed on Exhibit E attached hereto and Seller agrees to terminate
any existing Service Contract related to the roof of the Building on or before
the Closing.
5.1.6 No Default. The execution and delivery of this Agreement, and
consummation of the transaction described in this Agreement, does not and will
not constitute a default under any contract, lease, or agreement to which Seller
is a party.
5.1.7 No Suits. To Seller's knowledge, there is no action, suit or
proceeding pending or threatened against or affecting the Property or any
portion thereof, or relating to or arising out of the ownership, management or
operation of the Property, in any court or before or by and federal, state, or
municipal department, commission, board, bureau or agency or other governmental
instrumentality.
5.1.8 Environmental Condition. Each of the following representations
contained in this Section 5.1.8 is wholly qualified and limited by (a) any
matters disclosed in any materials made available or delivered to Purchaser by
Seller pursuant to Section 3 above or otherwise, (b) any matters disclosed in
any environmental reports or studies obtained by Purchaser, and (c) any other
matters about which Purchaser has actual knowledge. Subject to the foregoing,
Seller represents to its knowledge:
5.1.8.1 Except as may be disclosed in the Environmental Reports listed in
Schedule 5.1.8.1, there has been no, and there are no, Hazardous Materials on or
beneath the surface of the land constituting the Property or in any structures
or improvements thereon. For the purposes hereof, "Hazardous Material" shall
mean any substance, chemical, waste or other material which is listed, defined
or otherwise identified as "hazardous" or "toxic" under any federal, state,
local or administrative agency ordinance or law, including, without limitation,
the Comprehensive Environmental Response, Compensation and Liability Act, 42
U.S.C. ss.ss. 9601 et seq. and the Resource Conservation and Recovery Act, 42
U.S.C. ss.ss. 6901 et seq., or any regulation, order, rule or requirement
adopted hereunder, as well as any formaldehyde, urea, polychlorinated biphenyls,
petroleum, petroleum product or by-product, crude oil, natural gas, natural gas
liquids, liquefied natural gas, or synthetic gas usable for fuel or mixture
thereof, radon, asbestos, and "source," "special nuclear" and "by-product"
material as defined in the Atomic Energy Act of 1985, 42 U.S.C. ss.ss. 3011 et
seq.
5.1.8.2 The Property and the operations on the Property have been and are
in compliance with all environmental laws applicable thereto.
5.1.8.3 Except as may be disclosed in the Environmental Reports specified
in Schedule 5.1.8.1, no releasing, generating or handling of Hazardous Materials
has occurred on the Property, and Seller has not permitted the releasing,
generating or handling of Hazardous Materials on the Property or the
incorporation thereof in any buildings or improvements thereon, except in either
instance in minimal amounts customarily found in office uses and in compliance
with applicable law or as is otherwise allowed in compliance with applicable
law.
5.1.8.4 Seller has not received any summons, citation, directive, letter or
other communication, written or oral, from the United States Environmental
Protection Agency, the Suffolk County Department of Health Services or the New
York Department of Environmental Conservation Resources with respect to the
Property.
5.1.9 Licenses and Permits. To the knowledge of Seller, all licenses,
permits, variances, approvals, authorizations, easements, and rights of way
required for the use and operation of the Property and to insure vehicular and
pedestrian ingress and egress to the Property have been obtained.
5.1.10 Construction Contracts. Except as specified in Schedule 5.1.10,
Seller has entered into no outstanding written or oral contracts with regard to
construction of improvements on the Property, which have not been fully paid for
or which will not have been fully paid for as of Closing.
5.1.11 Options. Seller has no knowledge of any options or rights of first
refusal to acquire any interest in the property not set forth in the tenant
leases delivered to Purchaser or in documents of record disclosed in the title
commitment.
5.2 Seller Covenants. Seller covenants and agrees as follows:
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5.2.1 Seller shall not modify or amend any Service Contract or enter into
any new Service Contract without Purchaser's prior consent, unless the same is
terminable on or before the Closing.
5.2.2 No fixtures, equipment or personal property included in this sale
shall be removed from the Real Property without Purchaser's consent.
5.2.3 Seller shall not withdraw, settle or otherwise compromise any protest
or reduction proceeding affecting real estate taxes assessed against the Real
Property for any fiscal period in which the Closing is to occur or any
subsequent fiscal period without the prior written consent of Purchaser, which
consent shall not be unreasonably withheld. Portions of real estate tax refunds
and credits received after the Closing Date which are attributable to periods
prior to the date of the Lease between Purchaser and Seller reference dated
December 24, 1996 (the "Lease"), shall paid to Seller, after deducting the
expenses of collection thereof, which obligation shall survive the Closing.
5.3 Representations and Warranties of Purchaser. Purchaser hereby
represents and warrants to Seller that this Agreement has been, and all the
documents to be delivered by Purchaser to Seller will be, duly authorized,
executed, and are or will be legal, valid, and binding obligations of Purchaser,
are or will be enforceable in accordance with their respective terms, and do not
and will not at Closing violate any provisions of any agreement to which
Purchaser is subject.
5.4 Continuation. The continued accuracy in all respects of the aforesaid
representations and warranties shall be a condition precedent to the parties'
obligation to close. If any of Seller's said representations and warranties is
not correct in all material respects at the time the same is made or as of
Closing, or when remade at Closing, or if such warranty or representation
becomes inaccurate in any material respect on or prior to Closing, all of the
foregoing occurring other than by reason of Seller's default hereunder,
Purchaser may, upon being notified of such occurrence either (a) terminate this
Agreement, in which event the Deposit will be returned to Purchaser, and neither
party will have any further rights or obligations hereunder except as provided
in Section 8.15, or (b) waive such matter and proceed to Closing, by written
notice to Seller given within ten (10) days after Purchaser receives written
notice from Seller, or otherwise obtains actual knowledge, of such occurrence,
but in no event later than Closing. If Purchaser fails to give any such notice
within the required time period, Purchaser will be deemed to have elected to
waive such matter and proceed to Closing. The foregoing does not prohibit
Purchaser from seeking actual (but not special, consequential, exemplary or
punitive) damages proximately caused by Seller's knowing and intentional breach,
discovered before Closing, of any of Seller's representations and warranties
contained herein. However, and in any event, if Purchaser closes this
transaction after being notified or otherwise having actual knowledge of the
breach or inaccuracy of any representation or warranty hereunder, whether or not
knowing and intentional and whether or not occurring by reason of Seller's
default, Purchaser shall be conclusively deemed to have waived such matter and
shall be barred from asserting any claim with respect thereto. Subject to the
preceding sentence and to the time limitation of Section 8.11, nothing herein
shall prohibit Purchaser from seeking actual (but not special, consequential,
exemplary or punitive) damages proximately caused by the breach, discovered
after Closing, of any of Seller's representations and warranties contained
herein, which damages shall be limited in the aggregate to $200,000.00.
5.5 Condition of Property. Except as expressly set forth in this Agreement,
Seller has not made and does not hereby make any representations, warranties or
other statements as to the condition of the Property and Purchaser acknowledges
that at Closing it is purchasing the Property on an "AS IS, WHERE IS" basis as
of the Effective Date, subject to normal wear and tear and Purchaser's repair
obligations under the Lease, and without relying on any representations and
warranties of any kind whatsoever, express or implied, from Seller, its agents
or brokers as to any matters concerning the Property. Except as expressly set
forth in this Agreement, no representations or warranties have been made or are
made and no responsibility has been or is assumed by Seller or by any partner,
officer, person, firm, agent or representative acting or purporting to act on
behalf of Seller as to the condition or repair of the Property or the value,
expense of operation, or income potential thereof or as to any other fact or
condition which has or might affect the Property or the condition, repair,
value, expense of operation or income potential of the Property or any portion
thereof. The parties agree that all understandings and agreements heretofore
made between them or their respective agents or representatives, other than the
Lease, are merged in this Agreement and the Exhibits hereto annexed, which alone
fully and completely express their agreement, and that this Agreement has been
entered into after full investigation, or with the parties satisfied with the
opportunity afforded for investigation, neither party relying upon any statement
or representation by the other unless such statement or representation is
specifically embodied in this Agreement or the Exhibits annexed hereto.
Purchaser acknowledges that Seller has requested Purchaser to inspect fully the
Property and investigate all matters relevant thereto and to rely solely upon
the results of Purchaser's own inspections or other information obtained or
otherwise available to Purchaser, rather than any information that may have been
provided by Seller to Purchaser. Nothing contained in this paragraph is intended
to affect Purchaser's rights specifically set forth elsewhere in this Agreement.
5.5.1 Without limiting the generality of the foregoing, Purchaser further
acknowledges and agrees Seller has no obligation whatsoever under this Agreement
with respect to the condition of the roof other than the obligation to make
repairs to stop roof leaks. If this Agreement is terminated for any reason and
the existing lease remains in force, Seller's obligations with respect to the
roof shall be as landlord under, and as provided in, said lease; however,
Purchaser acknowledges and agrees that no major roof repair or replacement will
be undertaken by Seller/Landlord during the pendency of this Agreement, and
would not be undertaken by the landlord until spring, 1998.
6. Closing Conditions. Purchaser's obligation to proceed to Closing shall
be conditioned upon Seller's performance of the following obligations and
satisfaction of the following conditions, in addition to all of its other
obligations and conditions contained in this Agreement, provided that Purchaser
may in its sole discretion elect to waive failure by Seller to perform any
particular obligation.
6.1 The Title Insurer shall be prepared to issue a policy of title
insurance insuring Purchaser's interest in the Property being conveyed, subject
only to exceptions approved pursuant to Section 4.
6.2 All of Seller's representations and warranties made pursuant to Section
5.1 shall remain true and correct.
6.3 Seller shall have delivered all of the documents and other items
required pursuant to Section 7.6 and shall have performed all other covenants,
undertakings and obligations required by this Agreement, to be performed or
complied with by Seller at or prior to Closing.
7. Closing.
7.1 Closing of Sale. Purchaser and Seller shall use reasonable efforts to
close the purchase and sale contemplated herein (herein referred to as the
"Closing") at the office of the Purchaser's Lender's attorney on December 30,
1997, or as otherwise mutually agreed, but in no event shall the Closing occur
later than February 3, 1998 (the "Closing Date"). At Closing, Seller will
deliver to Purchaser a bargain and sale deed with covenant against grantor's
acts, in proper form for recording, duly executed and acknowledged, so as to
convey the title required by this contract ("Deed", Schedule 7.6.1) and other
closing documents required hereunder. The Deed shall also contain such recitals
as are required by the Title Insurer with respect to authorization, execution
and delivery of the Deed and Purchaser will cause payment of the Purchase Price
to be made to Seller by wire transfer. The sale (payment of Purchase Price and
delivery of Deed) may, at Purchaser's option, to be exercised by notice to
Seller at least five (5) days prior to the Closing Date, be closed through
escrow with the Title Insurer in accordance with the general provisions of the
usual form of escrow agreement used in similar transactions by such Title
Insurer with special provisions inserted as may be required to conform with this
Agreement.
7.2 Proration, Adjustments. Rental income shall be prorated as of 12:01
a.m. on the date after Closing (i.e., Seller is entitled to the income of the
day of Closing). In addition, Purchaser shall receive a credit at Closing for
its Security Deposit, as defined in the Lease, in the amount of $31,546.67. To
the extent that any items to be prorated are not known with certainty, such
proration shall be based upon the most recent ascertainable amounts. All
prorations shall be final. Purchaser shall deliver the Purchase Price to Seller
in good funds by 2:00 p.m. Chicago time on the day of Closing. If Seller does
not receive the funds by such time, prorations shall be made as of the next
business day.
7.3 Proration of Service Charges. To the extent Seller, as opposed to
tenants, is responsible for payment of utility charges, Seller will attempt to
have utility meters read as of the Closing Date. To the extent that this is not
possible and to the extent that any other obligation for continuing utility
services is incurred, and statements are rendered for such services covering
periods both before and after the Closing Date, the amount will be adjusted
between the parties as of the Closing Date on a per-diem basis. Seller will
forward any such statements which it receives to Purchaser and Purchaser shall
pay the same. Purchaser will forward any such statements which it receives to
Seller and Seller will remit to Purchaser its proportionate share immediately
upon demand.
7.4 Closing Costs. Seller shall pay up to an aggregate total of $60,000.00
toward the costs (the "Closing Costs") of (i) the Title Insurer's escrow and/or
closing fees (including any payment to the closing officer of the Title Insurer
as may be the local custom at the Closing), (ii) the cost of the basic title
commitment and policy, the cost of any endorsements to the title policy required
by Purchaser, including extended coverage, and all other fees and charges of the
Title Insurer, (iii) all recording fees and taxes, including but not limited to
mortgage recording taxes, (iv) the cost of the survey, if any, and (v) all
state, county and local or other transfer taxes. Purchaser shall be responsible
for all costs of Purchaser's physical inspections of the Property
(environmental, engineering), and other due diligence activities, and all
Closing Costs in excess of $60,000.00. Except as otherwise provided in Paragraph
8.9, each party shall be responsible for its own attorneys' and other
professional fees.
7.5 Possession. Purchaser is currently in possession of the Property.
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7.6 Seller's Closing Documents. As part of the Closing, Seller shall
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deliver to Purchaser:
7.6.1 the Deed, in the form of Schedule 7.6.1
7.6.2 an affidavit in customary form that Seller is not a "foreign person"
within the meaning of Section 1445(e) of the Internal Revenue Code of 1986, in
the form of Schedule 7.6.2;
7.6.3 such affidavits as are customarily required by Title Insurer in
connection with issuance of the owner's title insurance policy, including a
mechanics' lien and judgment affidavit;
7.6.4 a Lease Termination Agreement with respect to the existing lease
between Purchaser and Seller in the form of Schedule 7.6.4; 1.1.1
7.6.5 an assignment of Service Contracts, contracts (if accepted by
Purchaser) and warranties in the form of Schedule 7.6.5 ("Contracts
Assignment");
7.6.6 an assignment of intangibles and of licenses and permits, to the
extent such licenses and permits are assignable and not posted at the Property,
in the form of Schedule 7.6.6 ("Intangibles Assignment");
7.6.7 a "bring down certificate" stating that Seller's representations and
warranties are true and correct as of the closing date, in the form of Schedule
7.6.7;
7.6.8 evidence of Seller's authority to enter into and consummate all of
the transactions contemplated in this Agreement;
7.6.9 if a title examination discloses judgments, bankruptcies or other
returns against persons having names the same as or similar to that of Seller,
Seller shall deliver an affidavit showing that they are not against the Seller;
7.6.10 Seller's share of the Closing Costs, which may, at Seller's option,
be deducted from Seller's proceeds from the Purchase Price; and
7.6.11 All other documents, instruments or writings which may be reasonably
required to consummate the transactions contemplated herein.
7.7 Purchaser's Closing Documents. As part of the Closing, Purchaser
-----------------------------
shall deliver to Seller:
7.7.1 Good federal funds in an amount equal to the Purchase Price, less the
Deposit, and interest thereon, the Security Deposit and plus or minus prorations
as provided herein and plus funds sufficient to pay Purchaser's closing costs
hereunder;
7.7.2 such affidavits as are customarily required by Title Insurer in
connection with issuance of the owner's title insurance policy;
7.7.3 Executed counterpart of the Lease Termination Agreement;
7.7.4 Executed counterpart of the Contracts Assignment;
7.7.5 Executed counterpart of the Intangibles Assignment;
7.7.6 All other documents, instruments or writings which may be reasonably
required to consummate the transactions contemplated herein.
7.8 Joint Deliveries. At the Closing, Seller and Purchaser shall execute
and deliver to each other the following documents, in each case duly executed or
otherwise in proper form:
7.8.1 Closing Statement;
7.8.2 City, county and state transfer tax returns, declarations or similar
instruments; and
7.8.3 All other documents, instruments or writings which may be reasonably
required to consummate the transactions contemplated herein.
8. Miscellaneous.
--------------
8.1 Modifications. This Agreement can be amended only in writing.
8.2 Casualty and Condemnation. Seller shall keep its customary replacement
cost insurance covering the Property in effect until the Closing. If the
improvements on the Property or the Personal Property are destroyed or damaged
to the extent that repairs cost in excess of $200,000, or if the net proceeds of
insurance to be assigned to Purchaser shall be less than $200,000, or if
condemnation proceedings are commenced against the Property, between the date
hereof and the Closing, Purchaser may terminate this Agreement. If Purchaser
elects to accept the Property in its then condition, all proceeds of insurance
(plus the applicable deductible) or condemnation awards payable to Seller by
reason of such damage or condemnation shall be paid or assigned to Purchaser. In
the event of any other damage to the Property, which damage Seller is unwilling
to repair prior to Closing, Purchaser shall accept the Property in its then
condition, in which case Purchaser shall be entitled to a reduction in the
Purchase Price to the extent of the cost of repairing such damage, as certified
by an independent contractor selected by the parties. If Purchaser's Lender is
unwilling to consummate Purchaser's financing by reason of any casualty to, or
condemnation of, all or part of the Property, Purchaser may terminate this
Agreement. If Purchaser terminates this Agreement pursuant to this Paragraph,
Seller shall refund to Purchaser the Deposit. In the event of any damage where
Purchaser does not have the right to terminate or elects not to terminate and
Seller elects to repair such damage, the Closing Date shall be delayed for the
number of days required to repair the damage.
8.3 Time of Essence. If Purchaser, without fault of Seller, fails to close
the transaction contemplated herein on or before the Closing Date, and such
failure continues for five (5) days after written notice of such failure to
Purchaser, Seller may terminate this Agreement and direct Escrow Holder to pay
the Deposit to Seller as liquidated damages and as Seller's sole and exclusive
remedy.
8.4 Notices. All notices required or permitted hereunder shall be in
writing and shall be served on the parties at the following address:
If to Purchaser: Vicon Industries, Inc.
89 Arkay Drive
Hauppauge, New York 11788
Attn: Kenneth Darby
Facsimile: (516) 951-2288
with a copy to: Schoeman Marsh & Updike, LLP
60 East 42nd Street
New York, New York 10165
Attn: Nancy Connery
Facsimile: (212) 687-2123
If to Seller: The RREEF Funds
------------ 875 North Michigan Avenue
Suite 4114
Chicago, IL 60611
Attn: Ms.Pamela Boneham & Mr.John Turney
Facsimile: (312) 266-9346
with a copy to: The RREEF Funds
401 Hackensack Avenue, Suite 701
Hackensack, New Jersey 07601
Attn: Denise Stewart
Facsimile: (201) 488-8489
with a copy to: The RREEF Funds
125 Maiden Lane
Fifth Floor
New York, NY 10038
Attn: Alane Berkowitz
Facsimile: (212) 785-3630
with a copy to: D'Ancona & Pflaum
30 North LaSalle Street
Suite 2900
Chicago, Illinois 60602
Attn: Lawrence J. Moss
Facsimile: (312) 580-0923
Any such notices may be sent by (a) certified mail, return receipt requested, in
which case notice will be deemed delivered five (5) business days after deposit,
postage prepaid in the U.S. mail or (b) a nationally recognized overnight
courier, in which case notice will be deemed delivered one business day after
deposit with such courier or (c) facsimile transmission, in which case notice
will be deemed delivered upon electronic verification that transmission to
recipient was completed or (d) personal delivery. The above addresses and
facsimile numbers may be changed by written notice to the other party; provided
that no notice of a change of address or facsimile number will be effective
until actual receipt of such notice.
8.5 Successors and Assigns. This Agreement shall be binding upon and inure
to the benefit of the heirs, successors, and assigns of the parties hereto,
provided Purchaser may not assign its rights or obligations hereunder without
the prior written consent of Seller.
8.6 Governing Law. The performance and interpretation of this Agreement
shall be controlled by the law of the State in which the Property is located.
8.7 Continuation Until Closing. Between the date of execution of this
Agreement and the Closing, Seller shall keep and perform all of the obligations
to be performed by landlord under any leases or applicable laws, subject to
Section 5.5.1.
8.8 Brokers. Seller and Purchaser each (a) represents and warrants to the
other that it has not dealt with any broker or finder in connection with the
transaction contemplated by this Agreement other than the parties, if any, to be
paid a commission as specified in Paragraph 8.10, and (b) agrees to indemnify
and hold the other harmless from and against any losses, damages, costs, or
expenses (including attorneys' fees) incurred by such other party due to a
breach of the foregoing warranty by the indemnifying party.
8.9 Attorneys' Fees. If any action is brought by either party against the
other party, the party in whose favor final judgment shall be entered shall be
entitled to recover court costs incurred and reasonable attorneys' fees, at
trial, upon appeal and on any petition for review.
8.10 Brokers Commission. There are no brokers involved in this transaction.
Seller shall indemnify and hold Purchaser harmless from any and all losses,
liability, costs or expenses (including attorneys' fees) related to any claim
for a brokerage commission by the brokers to whom Seller paid a commission with
respect to the Lease.
8.11 Continuation and Survival of Covenants. All representations and
warranties by the respective parties contained in this Agreement or made in
writing pursuant to this Agreement are intended to and shall remain true and
correct as of the Closing. Seller's representations and warranties contained
herein and claims, damages or injury for the breach thereof shall survive the
date of Closing for a period of one (1) year. Purchaser must give Seller written
notice of any claim it may have against Seller for a any breach within one (1)
year after the Closing Date. Any claim which Purchaser may have which is not so
asserted within the one (1) year period will not be valid or effective and
Seller will have no liability with respect thereto.
8.12 Merger of Prior Agreements. This Agreement constitutes the entire
agreement between the parties with respect to the purchase and sale of the
Property and supersedes all prior agreements and understandings between the
parties hereto relating to said purchase and sale.
8.13 Invalidity of Provisions. In the event any provisions of this
Agreement are declared invalid or are unenforceable for any reason, such
provisions shall be deleted from such document and shall not invalidate any
other provision.
8.14 ERISA. Prior to Seller's execution of this Agreement, Purchaser shall
furnish to Seller all information regarding Purchaser, its affiliates and the
shareholders or partners of each of them (collectively, the "Purchaser Related
Parties") as Seller reasonably requests in order to enable Seller to determine
to Seller's sole satisfaction that the transaction contemplated hereby will not
constitute a sale to a "party-in-interest" within the meaning of Section 3(14)
of the Employee Retirement Security Act of 1974, as amended ("ERISA"), with
respect to any investor in Seller. Purchaser represents and warrants to Seller
that there will not be any change in any such information regarding Purchaser or
the Purchaser Related Parties, which change could lead to an ERISA violation,
prior to or on the Closing. At Seller's request, Purchaser will complete
Seller's standard Party In Interest/Prohibited Transaction Questionnaire,
substantially in the form of Exhibit C attached hereto, within five (5) working
days after receipt of such request. If Seller reasonably determines that the
transaction contemplated hereby will constitute a "prohibited transaction," or
is otherwise prohibited, under ERISA, and no exemption is available, Seller,
upon written notice to Purchaser, may cancel this Agreement and the Deposit
shall be returned to Purchaser and Seller shall reimburse Purchaser for the
Title Insurer's charges, the costs incurred by Purchaser to update or obtain a
new survey (as the case may be), the costs incurred by Purchaser to obtain any
financing commitment, and the costs incurred by Purchaser to obtain any
environmental report for the Real Property.
8.15 On-Site Testing. In connection with any on-site testing, Purchaser
shall give Seller written notice thereof, including the identity of the company
or persons who will perform such testing and the proposed scope of the testing.
Seller shall approve or disapprove the scope and methodology of such proposed
testing within three (3) business days after receipt of such notice, such
approval not to be unreasonably withheld; Seller's failure to notify Purchaser
of its approval or disapproval shall be deemed to be Seller's disapproval
thereof. Any disapproval shall include a reasonably detailed statement of
Seller's basis for objection. If Purchaser or its agents, employees or
contractors take any sample from the Property in connection with any such
approved testing, upon Seller's request, Purchaser shall provide to Seller a
portion of such sample being tested to allow Seller, if it so chooses, to
perform its own testing. Seller or its representative may be present to observe
any testing or other inspection performed on the Property. Upon Seller's
request, Purchaser shall promptly deliver to Seller copies of any reports
relating to any testing or other inspection of the Property performed by
Purchaser or its agents, employees or contractors. Purchaser shall maintain, and
shall assure that its contractors maintain, public liability and property damage
insurance in amounts and in form and substance reasonably acceptable to Seller,
insuring against all liability of Purchaser, its agents, employees or
contractors, arising out of any entry or inspections of the Property pursuant to
the provisions hereof, and Purchaser shall provide Seller with evidence of such
insurance coverage upon request by Seller. Purchaser shall indemnify, defend and
hold Seller harmless from and against any costs, damages, liabilities, losses,
expenses, liens or claims (including, without limitation, reasonable attorney's
fees) arising out of or relating to damage or injury caused by any entry on the
Property by Purchaser, its agents, employees or contractors in the course of
performing the inspections, testings or inquiries provided for in this
Agreement, including without limitation damage to the Property or release of
hazardous substances or materials onto the Property, excluding, however, any
costs incurred by Seller in supervising Purchaser's testing and excluding any
damage caused by the negligence or misconduct of Seller, its contractors or
agents. The foregoing indemnity shall survive beyond the Closing, or if the sale
is not consummated, beyond the termination of this Agreement. Nothing in this
Section 8.15 shall be construed to limit or impair Purchaser's absolute right to
terminate under Section 3.
8.16 Release. Except to the extent of the representations and warranties of
Seller expressly set forth in this Agreement, but otherwise notwithstanding any
other provision of this Agreement to the contrary, Purchaser, on behalf of
itself and its successors and assigns, waives its right to recover from, and
forever releases and discharges, Seller, Seller's affiliates, Seller's
investment manager, the partners, trustees, shareholders, directors, officers,
employees and agents of each of them, and their respective heirs, successors,
personal representatives and assigns (collectively, the "Seller Related
Parties"), from any and all demands, claims, legal or administrative
proceedings, losses, liabilities, damages, penalties, fines, liens, judgments,
costs or expenses whatsoever (including, without limitation, attorneys' fees and
costs), whether direct or indirect, known or unknown, foreseen or unforeseen,
which may arise on account of or in any way be connected with the physical
condition of the Property or any law or regulation applicable thereto,
including, without limitation, the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended (42 U.S.C. Sections 9601 et
seq.), the Resources Conservation and Recovery Act of 1976 (42 U.S.C. Section
6901 et seq.), the Clean Water Act (33 U.S.C. Section 466 et seq.), the Safe
Drinking Water Act (14 U.S.C. Sections 1401-1450), the Hazardous Materials
Transportation Act (49 U.S.C. Section 1801 et seq.), the Toxic Substance Control
Act (15 U.S.C. Sections 2601-2629) and the Americans with Disabilities Act of
1990 (42 U.S.C. Section 12101 et seq.).
8.17 Confidential Information. The parties acknowledge that the transaction
described herein is of a confidential nature and shall not be disclosed except
to consultants, investors, advisors, and affiliates, or as required by law. No
party will make any public disclosure of the specific terms of this Agreement,
except as required by law. In connection with the negotiation of this Agreement
and the preparation for the consummation of the transactions contemplated
hereby, each party acknowledges that it will have access to confidential
information relating to the other party. Each party shall treat such information
as confidential, preserve the confidentiality thereof, and not duplicate or use
such information, except to advisors, consultants, investors and affiliates in
connection with the transactions contemplated hereby, or as required by law. In
the event of the termination of this Agreement for any reason whatsoever,
Purchaser will return to Seller, at Seller's request, all documents, work
papers, and other material (including all copies thereof) obtained from Seller
in connection with the transactions contemplated hereby, and each party shall
use its best efforts, including instructing its employees and others who have
had access to such information, to keep confidential and not to use any such
information. The provisions of this Section 8.17 will survive the Closing or, if
the purchase and sale is not consummated, any termination of this Agreement, and
will not be subject to the limitation set forth in Section 8.11. Notwithstanding
any contrary provisions of Sections 3.4 and 8.17, Seller agrees that Purchaser
may disclose information obtained by Purchaser (a) to its consultants and
professionals engaged by Purchaser in connection with Purchaser's purchase of
the Property, who shall be requested to maintain confidentiality, (b) as
required by court order or other legal process, and (c) as required by the
applicable provisions of the Securities Exchange Act of 1934, the Securities Act
of 1933, and the rules and regulations promulgated thereunder, and as required
by other applicable provisions of law.
8.18 Calculation of Time Periods. Unless otherwise specified, in computing
any period of time described herein, the day of the act or event, after which
the designated period of time begins to run, is not to be included and the last
day of the period so computed is to be included, unless such last day is a
Saturday, Sunday or legal holiday, in which event the period shall run until the
end of the next day which is neither a Saturday, Sunday, or legal holiday. The
last day of any period of time described herein shall be deemed to end at 5 p.m.
Chicago, Illinois time on the last day of such period of time.
8.19 Exculpation Clause. The obligations of Seller contained herein are
intended to be binding only on the property of the trust party to this Agreement
of Purchase and Sale and shall not be personally binding upon, nor shall any
resort be had to the private properties of, any of the trustees, investment
managers, any general partners thereof, or any employees or agents of the
trustees or investment managers. All documents to be executed by Seller shall
also contain the foregoing exculpation.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the dates set forth below.
SELLER:
RREEF MIDAMERICA/EAST-V NINE, INC., a Delaware
corporation
By: RREEF America L.L.C., a Delaware limited
liability company, its investment advisor
By:
Authorized Representative
Dated:
PURCHASER:
VICON INDUSTRIES, INC., a New York corporation
By:
Kenneth Darby, President
Dated:
List of Schedules and Exhibits
Schedules
2.1 Earnest Money Escrow Instructions
5.1.8.1 Possible Hazardous Materials
5.1.10 Construction Obligations
7.6.1 Form of Deed
7.6.2 FIRPTA Certificate
7.6.4 Lease Termination Agreement
7.6.5 Assignment and Assumption of
Contracts and Warranties
7.6.6 Assignment of Intangibles
7.6.7 Bring-Down Certificate
Exhibits
A Legal Description of Property
B Due Diligence Deliveries
C Party In Interest/Prohibited
Transaction Questionnaire
Schedule 2.1
EARNEST MONEY ESCROW INSTRUCTIONS
ESCROW #___________
ESCROW INSTRUCTIONS
These Escrow Instructions are entered into as of this _____day of
December, 1997 by and among RREEF MIDAMERICA/EAST-V, a Delaware corporation
("Seller"), VICON INDUSTRIES, INC., a New York corporation ("Purchaser") and
D'ANCONA & PFLAUM ("Escrow Holder").
RECITALS:
A. WHEREAS, Seller and Purchaser have entered into that certain
Agreement of Purchase and Sale dated December __, 1997 (the "Agreement"),
whereby Seller agreed to sell and Purchaser agreed to purchase certain real
property located in the City of Hauppauge, Suffolk County, State of New York,
more particularly described therein (the "Property");
B. WHEREAS, the Agreement obligates Purchaser to deposit the sum of One
Hundred Fifty Thousand and 00/100 Dollars ($150,000.00) with Escrow Holder to
secure its obligations under the Agreement at this time (such deposit, together
any interest earned thereon, the "Deposit") ; and
C. WHEREAS, the parties now desire to set forth the terms and
conditions of the Escrow.
NOW THEREFORE, in consideration of good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties agree as
follows:
AGREEMENTS:
1. The parties agree that the Deposit shall be placed in an
interest-bearing escrow account with Escrow Holder in order to secure the
obligations of Purchaser pursuant to the Agreement and that any interest earned
thereon, less investment fees, if any, shall be deemed to be part of the
Deposit. The Deposit may be invested at the direction of Purchaser with the
approval of Seller.
2. In the event that Purchaser delivers a request for the Deposit to
Escrow Holder on or before _____________, 1997 (the last day of the Review
Period under the Agreement), Escrow Holder shall deliver the Deposit to
Purchaser and notify Seller of such disbursement. Such request shall constitute
Purchaser's election to terminate the Agreement pursuant to Paragraph 3 of the
Agreement. Purchaser shall send a copy of such request to Seller simultaneously
with delivery of such request to Escrow Holder.
3. Following the expiration of the Review Period, in the event that any
party hereto timely delivers a notice to the other parties hereto disputing a
disbursement request, Escrow Holder shall continue to hold such disputed funds
until Escrow Holder shall receive a joint order from Purchaser and Seller
requesting such disbursement or Escrow Holder shall receive an order, judgment
or decree of any court ordering disbursement. In the event that Escrow Holder
complies with any orders, judgments or decrees issued or entered by any court,
Escrow Holder shall not be liable to any of the parties hereto by reason of such
compliance. In the absence of such a joint order or court order, Escrow Holder
may do nothing or may commence an interpleader action as set forth in Paragraph
4 below.
4. Escrow Holder may pay the Escrow Funds into a court of competent
jurisdiction upon commencement by Escrow Holder of an interpleader action in
such court. The costs and attorneys fees of Escrow Holder for such interpleader
action shall be paid one-half by each of the parties.
5. For purposes of this Agreement, notices sent by facsimile or
personal delivery may be addressed as follows:
If to Purchaser: Vicon Industries, Inc.
89 Arkay Drive
Hauppauge, New York 11788
Attn: Kenneth Darby
Facsimile: (516) 951-2288
with a copy to: Schoeman Marsh & Updike, LLP
60 East 42nd Street
New York, New York 10165
Attn: Nancy Connery
Facsimile: (212) 687-2123
If to Seller: The RREEF Funds
------------ 875 North Michigan Avenue
Suite 4114
Chicago, IL 60611
Attn: Ms. Pamela Boneham & Mr. John Turney
Facsimile: (312) 266-9346
with a copy to: The RREEF Funds
401 Hackensack Avenue, Suite 701
Hackensack, New Jersey 07601
Attn: Denise Stewart
Facsimile: (201) 488-8489
with a copy to: The RREEF Funds
125 Maiden Lane
Fifth Floor
New York, NY 10038
Attn: Alane Berkowitz
Facsimile: (212) 785-3630
with a copy to: D'Ancona & Pflaum
30 North LaSalle Street
Suite 2900
Chicago, Illinois 60602
Attn: Lawrence J. Moss
Facsimile: (312) 580-0923
If to Escrow D'Ancona & Pflaum
Holder: 30 North LaSalle Street
Suite 2900
Chicago, Illinois 60602
Attn: Lawrence J. Moss
Facsimile: (312) 580-0923
6. Escrow Holder shall have only such duties as are herein specifically
provided and shall incur no liability whatsoever, except for wilful misconduct
or gross negligence so long as Escrow Holder has acted in good faith. Escrow
Holder may consult with counsel and shall be fully protected in any action taken
in good faith in accordance with such advice. Escrow Holder shall be fully
protected in acting in accordance with any written instrument given to it
hereunder and believed by it to have been signed by any proper party.
7. Purchaser acknowledges that Escrow Holder is Seller's attorney, and
that Purchaser, having been advised by counsel, has consented to Escrow Holder
acting as escrow holder despite also being Seller's attorney. Escrow Holder
shall not be liable for any action with respect to the Deposit taken in good
faith, any such liability hereby being waived by Purchaser and Seller. Without
limiting the generality of the foregoing, Purchaser and Seller authorize and
direct Escrow Holder to accept, comply with, and obey any and all writs, orders,
judgments or decrees entered or issued by any court with or without
jurisdiction. In case Escrow Holder is made a party defendant to any suit or
proceedings regarding the Deposit, Purchaser and Seller, jointly and severally,
agree to pay to Escrow Holder, upon demand, all costs, attorney's fees, and
expenses incurred with respect thereto. Purchaser agrees and consents that the
firm of D'Ancona & Pflaum shall not be disqualified from representing Seller in
any litigation or other proceeding arising out of this Agreement, whether or not
related to the Deposit, merely due to its acting as Escrow Holder hereunder;
provided, however, that prior to undertaking any such representation, D'Ancona &
Pflaum shall cause the Deposit to be deposited with the court or a new third
party escrow holder acceptable to Purchaser and Seller.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
SELLER:
RREEF MIDAMERICA/EAST-V NINE, INC., a Delaware
corporation
By: RREEF America L.L.C., a Delaware limited
liability company, its investment advisor
By:
Authorized Representative
Dated:
ESCROW HOLDER:
D'ANCONA & PFLAUM
By:
Title:
Dated:
PURCHASER:
VICON INDUSTRIES, INC., a New York corporation
By:
Title:
Dated:
Schedule 5.1.8.1
Environmental Reports
1. Letter from ATC Associates Inc. dated September 19, 1997.
2. Documentation regarding spill #8900915, including letter from
Diagnostic Engineering Inc. dated August 14, 1989.
3. Documentation of underground fuel storage tank.
4. Asbestos survey from ATC Associates Inc. dated December 30, 1996.
5. Asbestos Project Monitoring Report prepared by ATC Environmental Inc,
Project No. 87600-0033.
6. Closeout Submittal from EWT Contracting, Inc. dated January 1997.
Schedule 5.1.10
Construction Obligations
-None-
Schedule 7.6.1
Form of Deed
(To be agreed)
Schedule 7.6.2
FIRPTA CERTIFICATE
Section 1445 of the Internal Revenue Code provides that a transferee of
a U.S. real property interest must withhold tax if the transferor is a foreign
person. To inform the transferee that withholding of tax is not required upon
the disposition of a U.S. real property interest by RREEF MIDAMERICA/EAST-V
NINE, INC., a Delaware corporation ("Seller") hereby certifies the following:
1.Seller is not a foreign corporation, foreign partnership, foreign trust
or foreign estate (as those terms are defined in the Internal Revenue
Code and Income Tax Regulations);
2. Seller's U.S. employer identification number is 94-2624868; and
3. Seller's principal place of business is 650 California Street, Suite 1800,
San Francisco, CA 94108.
Seller understands that this certification may be disclosed to the
Internal Revenue Service by transferee and that any false statement contained
herein could be punished by fine, imprisonment, or both.
Under penalties of perjury I declare that I have examined this
certification and to the best of my knowledge and belief it is true, correct and
complete, and I further declare that I have authority to sign this document on
behalf of Seller.
RREEF MIDAMERICA/EAST-V NINE, INC., a Delaware corporation
By: RREEF America L.L.C., a Delaware limited liability company,
its investment advisor
By:___________________________
Authorized Representative
Subscribed and sworn to
before me this ____ day of
- ------,
- ------------------------------
Notary Public
Schedule 7.6.4
LEASES TERMINATION AGREEMENT
THIS TERMINATION, dated this __day of _________, 19 ___, between RREEF
MIDAMERICA/EAST-V NINE, INC., a Delaware corporation ("Landlord") and VICON
INDUSTRIES, INC., a New York corporation ("Tenant"), for the premises located in
the City of Hauppauge, County of Suffolk, State of New York, commonly known as
89 Arkay Drive, Hauppauge, New York (the "Premises").
W I T N E S S E T H :
WHEREAS, Landlord and Tenant entered into that certain Lease reference
dated December 24, 1996 (the "Lease"); and
WHEREAS, Landlord and Tenant desire to terminate the Lease as more
fully set forth below.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
contained herein and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties agree to terminate the
Lease under the following conditions:
1. TERMINATION DATE. The Lease shall terminate on __________________,
19__, in the same manner and with the same effect as if that date had
been originally fixed in the Lease for the expiration of the term,
conditioned on the performance by the parties of the provisions of this
Agreement. If Tenant fails to vacate the Premises on the Termination
Date, Landlord's remedies shall be as specified in the Lease.
2. OUTSTANDING RENT AND OTHER CHARGES. Tenant shall pay to Landlord all
rent and other charges as specified in the Lease through the
Termination Date. Any charges which cannot be ascertained prior to the
Termination Date shall be estimated by Landlord and Tenant shall pay
such estimated amount. All such amounts shall be used and held by
Landlord for payment of such obligations of Tenant, with Tenant being
liable for any additional costs upon demand by Landlord, or with any
excess to be returned to Tenant after all such obligations have been
determined and satisfied.
3. LIMITATION OF LANDLORD'S LIABILITY. Redress for any claims against
Landlord under this Termination Agreement shall only be made against
Landlord to the extent of Landlord's interest in the property of which
the Premises are a part. The obligations of Landlord under this
Termination Agreement shall not be personally binding on, nor shall any
resort be had to the private properties of, any of its trustees or
board of directors and officers, and the case may be, the general
partners thereof or any beneficiaries, stockholders, employees or
agents of Landlord, or its investment manager.
IN WITNESS WHEREOF, this Agreement is executed as of the day and year
first written above.
LANDLORD: TENANT:
RREEF MIDAMERICA/EAST-V VICON INDUSTRIES, INC.,
NINE, INC., a Delaware corporation a New York corporation
By: RREEF America L.L.C.,
a Delaware limited liability
company, its investment advisor
By: By:
Authorized Representative Its:
Schedule 7.6.5
ASSIGNMENT AND ASSUMPTION OF CONTRACTS AND WARRANTIES
THIS ASSIGNMENT (the "Assignment"), dated this ___ day of February,
1998, is made by and among RREEF MIDAMERICA/EAST-V NINE, INC., a Delaware
corporation (the "Assignor") and VICON INDUSTRIES, INC., a New York corporation
(the "Assignee").
WHEREAS, Assignee has this day purchased Assignor's interest in the
real property legally described on the attached Exhibit A (the "Property"); and
WHEREAS, the execution and delivery of this Assignment is a
condition precedent to the purchase by the Assignee of the Property;
NOW, THEREFORE, in consideration of the purchase and sale of the
Property, and for other good and valuable consideration, Assignor agrees as
follows:
1. Assignor hereby grants, transfers and assigns to Assignee all the
right, title and interest of Assignor in and to the following:
(a) All contracts listed on Exhibit B attached hereto.
(b) All presently effective and assignable warranties,
guaranties, representations or covenants given to or made in favor of Assignor
or Assignor's affiliates in connection with the acquisition, development,
construction, maintenance, repair, renovation or inspection of the Property.
The foregoing are collectively referred to herein as the "Contracts."
2. Assignor agrees to assume full responsibility for all the
obligations under the Contracts accruing prior to the date hereof and Assignor
agrees to indemnify and hold Assignee harmless from any claims, liabilities or
costs arising from Assignor's failure to perform said obligations.
3. Assignee assumes full responsibility for all obligations accruing
from and after the date hereof and Assignee agrees to indemnify and hold
Assignor and its predecessors in title harmless from all claims, liabilities or
costs arising from Assignee's failure to perform said obligations.
4. This instrument may be executed in counterparts.
5. The obligations of Assignor contained herein are intended to be
binding only on the property of the trust party to this Agreement and shall not
be personally binding upon, nor shall any resort be had to the private
properties of, any of the trustees, investment managers, any general partners
thereof, or any employees or agents of the trustees or investment managers.
IN WITNESS WHEREOF, the parties have executed this Assignment as of the
date first written above.
ASSIGNOR:
RREEF MIDAMERICA/EAST-V NINE, INC., a Delaware
corporation
By: RREEF America L.L.C., a Delaware limited
liability company, its investment advisor
By:___________________________
Authorized Representative
ASSIGNEE:
VICON INDUSTRIES, INC., a New York corporation
By:
Title:
EXHIBIT A
Legal Description
EXHIBIT B
Contracts
Schedule 7.6.6
ASSIGNMENT OF INTANGIBLES
THIS ASSIGNMENT (the "Assignment"), dated this ___ day of February,
1998, is made by and among RREEF MIDAMERICA/EAST-V NINE, INC., a Delaware
corporation (the "Assignor") and (the "Assignee").
WHEREAS, Assignee has this day purchased Assignor's interest in the
real property legally described on the attached Exhibit A (the "Property"); and
WHEREAS, the execution and delivery of this Assignment is a
condition precedent to the purchase by the Assignee of the Property;
NOW, THEREFORE, in consideration of the purchase and sale of the
Property, and for other good and valuable consideration, Assignor agrees as
follows:
1. Assignor hereby grants, transfers and assigns to Assignee all the
right, title and interest of Assignor in and to the following:
(i) All licenses, permits, certificates of occupancy,
approvals, dedications, subdivision maps or plats and entitlements
issued, approved or granted by federal, state or municipal authorities
or otherwise in connection with the Property and its renovation,
construction, use, maintenance, repair, leasing and operation; and all
licenses, consents, easements, rights of way and approvals required
from private parties to make use of utilities, to insure pedestrian
ingress and egress to the Property and to insure continued use of any
vaults under public rights-of-way presently used in the operation of
the Property.
(ii) any trade style or trade name used in connection with the
Property; and,
(iii) all correspondence with the tenants under tenant leases,
all booklets and manuals relating to the maintenance and operation of
the Property.
The foregoing are collectively referred to herein as the "Intangibles".
2. Assignor agrees to assume full responsibility for all the
obligations under the Intangibles accruing prior to the date hereof and Assignor
agrees to indemnify and hold Assignee harmless from any claims, liabilities or
costs arising from Assignor's failure to perform said obligations.
3. Assignee assumes full responsibility for all obligations accruing
under the Intangibles from and after the date hereof and Assignee agrees to
indemnify and hold Assignor and its predecessors in title harmless from all
claims, liabilities or costs arising from Assignee's failure to perform said
obligations.
4. This instrument may be executed in counterparts.
5. The obligations of Assignor contained herein are intended to be
binding only on the property of the trust party to this Agreement and shall not
be personally binding upon, nor shall any resort be had to the private
properties of, any of the trustees, investment managers, any general partners
thereof, or any employees or agents of the trustees or investment managers.
IN WITNESS WHEREOF, the parties have executed this Assignment as of the
date first written above.
ASSIGNOR:
RREEF MIDAMERICA/EAST-V NINE, INC., a Delaware
corporation
By: RREEF America L.L.C., a Delaware limited
liability company, its investment advisor
By:___________________________
Authorized Representative
ASSIGNEE:
VICON INDUSTRIES, INC., a New York corporation
By:
Title:
EXHIBIT A
Legal Description
Schedule 7.6.7
SELLER'S CLOSING CERTIFICATE
THIS CLOSING CERTIFICATE is made as of the __ day of February, 1998, by and
between RREEF MIDAMERICA/EAST-V NINE, INC., a Delaware corporation ("Seller"),
to and in favor of VICON INDUSTRIES, INC., a New York corporation ("Purchaser"),
under and pursuant to that certain Agreement of Purchase and Sale by and between
Seller and __________, dated as of ________, (the "Agreement"), for the purchase
and sale of that certain Property situated in the City of Hauppauge, Suffolk
County, State of New York (as defined in the Agreement).
Pursuant to Sections 6.2 and 7.6.7 of the Agreement and except as
disclosed on Exhibit A attached hereto and made a part hereof, Seller hereby
reconfirms, remakes and rewarrants to Purchaser as of the date hereof each of
the representations, warranties and covenants given by Seller contained in
Section 5.1 of the Agreement in the same manner as such representations,
warranties and covenants were given in the Agreement, each of which is
incorporated herein and made a part hereof by this reference. Except as modified
hereby, Seller hereby confirms that each of said representations, warranties and
covenants are true and accurate in all material respect as of the date hereof.
Seller's reconfirming, remaking and rewarranting of its representations,
warranties and covenants is subject to the limitations set forth in Sections 5.4
and 8.11 of the Agreement.
The obligations of Seller contained herein are intended to be binding
only on the property of the trust party to this Certificate and shall not be
personally binding upon, nor shall any resort be had to the private properties
of, any of the trustees, investment managers, any general partners thereof, or
any employees or agents of the trustees or investment managers.
IN WITNESS WHEREOF, Seller has executed this Closing Certificate as of
the day and year first above written.
SELLER:
RREEF MIDAMERICA/EAST-V NINE, INC., a California
group trust
By: RREEF America L.L.C., a
Delaware limited liability company,
its investment advisor
By:
EXHIBIT A
Disclosure
EXHIBIT A
Legal Description of the Property
EXHIBIT B
Due Diligence Deliveries
1. RREEF's most recent environmental audit of the Property.
C-6
EXHIBIT C
------------------------------------------------------
(Name of Employee Benefit Plan/Trust or Investment Fund)
SALE OF ______________________________________
(Description of Property)
Party In Interest/Prohibited Transaction Questionnaire
TO BE COMPLETED BY PURCHASER
The purpose of this questionnaire is to determine whether the sale of the
property described above (the "Property") by or on behalf of the investment
fund, the assets of which are employee benefit plan assets, named above for
which RREEF America L.L.C. ("RREEF") is an investment manager (the "Plan" and,
if an entity owned by the Plan is the actual seller, the "Seller") to the
purchaser of such property (the "Purchaser") would be a prohibited transaction
within the meaning of section 406 of the Employee Retirement Income Security Act
of 1974, as amended ("ERISA"), or section 4975(c) of the Internal Revenue Code
of 1986, as amended. Attached to this questionnaire is a list of fiduciaries of
and service providers to the Plan, employers and employee organizations whose
employees and members respectively, are covered by the Plan, and affiliates of
the Plan, the trustee(s) of the Plan, including any employee benefit plans whose
assets form a part of the Plan (the "Trustee"), RREEF and the sponsoring
employers, of which the Seller and the Plan is aware.
INSTRUCTIONS: Complete the unanswered items. Review those questions to which
answers have already been provided and note any exceptions to the answers. If
the answer to any question is YES, attach an explanation setting forth the names
of the parties, exact relationship and, if applicable, ownership interests
involved. In addition, attach a list of all Purchaser's affiliates and entities
in which Purchaser directly or through any subsidiary owns a 10% or more
interest (including partnerships and joint ventures).
A. GENERAL Y/N
1. Does Purchaser or any affiliate1 of Purchaser have, or has it during
the immediately preceding one-year period, exercised, the authority to
appoint or terminate RREEF as the Plan's asset manager or negotiate the
terms (including renewals or modifications) of RREEF's management
agreement with the Plan?
- ---
2. Is the Purchaser or any affiliate of the Purchaser an owner of 5% or
more of the interests of RREEF?
___
If either of these questions is answered YES, the QPAM exemption may not apply,
in which case, the transaction must be scrutinized to ensure that neither the
Purchaser nor its affiliates are parties in interest.
B. PURCHASER
1. Following the sale, will the property be a "plan asset", within the
meaning of Department of Labor regulation ss. 2510.3-101, with
___ respect to any "employee benefit plan", within the meaning of section
3(3) of the ERISA, which is subject to ERISA?
2. If the Property will be a plan asset, is the Purchaser a "qualified
plan asset manager", within the meaning of section V(c) of
Prohibited Transaction Class Exemption ("PTE") 84-14, and is PTE 84-14
applicable to the transaction?
___
3. If the Property will be a plan asset, but PTE 84-14 is not applicable
to the transaction, has Purchaser determined that the transaction
is not a prohibited transaction with respect to the employee benefit
plans with respect to which the Property is currently a plan asset?
___
4. Is the Purchaser or a Parent2 of the Purchaser, an administrator,
trustee, custodian or other fiduciary with respect to the Seller or
the Plan (including any plan whose assets form a part of the Plan),
counsel to the Purchaser or the Plan or an employee of the Plan?
___
5. Is the Purchaser or a Parent of the Purchaser providing any services to
the Seller or the Plan (including any plan whose assets form a part
of the Plan)?
___
6. Is the Purchaser, or a Parent or a Subsidiary3 of the Purchaser, an
employer any of whose employees are covered under the Plan
(including any plan whose assets form a part of the Plan)?
___
7. Is the Purchaser, or a Parent or a Subsidiary of the Purchaser, an
employee organization, any of whose members are covered by the Plan
(including any plan whose assets form a part of the Plan)?
___
8. Is the Purchaser or any affiliate of the Purchaser an owner of 5% or
more of the interests of the Trustee?
- ---
9. Is the Trustee or any affiliate of the Trustee the owner of 5% or
more of the interests of the Purchaser?
___
10. Is the Purchaser a 10% joint venturer with RREEF or the Trustee?
___
PURCHASER
VICON INDUSTRIES, INC., a New York corporation,
By:______________________________________
Its:________________________________
EXHIBIT D
Permitted Exceptions
EXHIBIT E
Service Contracts
- --------
NOTES TO PARTY IN INTEREST/PROHIBITED TRANSACTION QUESTIONNAIRE
1. "Affiliate" means
(I) any person, directly or indirectly, controlled by, controlling or
under common control with the named person; (ii) any corporation,
partnership, trust or unincorporated enterprise of which the named
person is an officer, director or 5% or more partner; or (iii) any
director or highly compensated (within the meaning of section
4975(e)(2)(H) of the Internal Revenue Code) employee of the named
person.
2. "Parent" means a person who, directly or indirectly, owns 50% or more
of the (I) combined voting power of all classes of stock, in the case
of a corporation, (ii) capital interests or profits interests, in the
case of a partnership, or (iii) beneficial interests, in the case of a
trust.
3. "Subsidiary" means an entity in which a person owns, directly or
indirectly, 50% or more of (I) the combined voting power of all classes
of stock, in the case of a corporation, (ii) the capital or profits, in
the case of a partnership, or (iii) the beneficial interests, in the
case of a trust.