AGREEMENT FOR PURCHASE AND SALE
OF
REAL PROPERTY
BY AND BETWEEN
PMC-SIERRA, INC.,
A DELAWARE CORPORATION
AS SELLER
AND
WB MISSION TOWERS, LLC,
A DELAWARE LIMITED LIABILITY COMPANY,
AS BUYER
JUNE 29, 2003
PROPERTY LOCATED AT:
3985 FREEDOM CIRCLE
SANTA CLARA, CALIFORNIA
AGREEMENT FOR PURCHASE AND SALE
OF
REAL PROPERTY
THIS AGREEMENT FOR PURCHASE AND SALE OF REAL PROPERTY (the "Agreement")
is dated as of the 29th day of June, 2003 by and between PMC-SIERRA, INC., a
Delaware corporation ("Seller" or "PMC"), and MISSION TOWERS, LLC, a Delaware
limited liability company ("Buyer" or "Westbrook").
RECITALS
A. PMC, as tenant, and WHTS Freedom Circle Partners II, LLC ("WHTS"),
as landlord, are parties to that certain Lease dated as of July 20, 2000 (as
amended, the "WHTS Lease"), pursuant to which PMC leases the Property (as
hereinafter defined) from WHTS.
B. In addition, PMC, as buyer, and WHTS, as seller, have entered into
that certain Agreement for Purchase and Sale dated as of the date hereof (the
"WHTS Agreement"), pursuant to which PMC or an affiliate of PMC has the right to
acquire the fee interest in the Property from WHTS, a true and correct copy of
which has been delivered to Buyer.
C. Seller desires to sell the Property to Buyer, and Buyer desires to
purchase the Property from Seller, upon and subject to the terms and conditions
of this Agreement
AGREEMENT
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, Seller and Buyer hereby agree as
follows:
1. Definitions. Unless the context otherwise specifies or requires, for
the purposes of this Agreement all words and phrases having their initial
letters capitalized herein shall have the meanings set forth below:
"Adjacent Property" shall mean the real property owned by WHTS Freedom
Circle Partners, L.L.C., a Delaware limited liability company, commonly known as
3975 Freedom Circle, Santa Clara, California, and more particularly described in
Exhibit R to this Agreement.
"Closing Certificates" shall mean the Seller Closing Certificate to be
delivered to Buyer on the Closing Date in the form of Exhibit O, including
therewith the WHTS Closing Certificate, which is to be delivered to Seller for
the benefit of Seller and Buyer upon the closing of the Seller's acquisition of
the Property from WHTS, in the form of Attachment A to Exhibit O (or such other
form as Buyer will accept in its discretion).
"Closing Date" shall mean the date of recordation of the Deed.
"Closing Documents" shall mean the Closing Certificates, the Parking
Easement Agreement, the Reliance Letter, and the Development Indemnity Agreement
and, if applicable, the WHTS Modification Indemnity.
"Contingency Period" shall mean the period commencing on the Contract
Date and terminating at 11:00 a.m. Pacific Time on July 2, 2003.
"Contract Date" shall mean June 11, 2003.
"Development Indemnity Agreement" shall mean a Development Indemnity
Agreement in the form set forth in attached Exhibit S, to be executed and
recorded in the office of the Santa Clara County Clerk Recorder, on or prior to
the Closing Date, by WHTS and WHTS Freedom Circle Partners, L.L.C. a Delaware
limited liability company (as the owner of the Adjacent Property).
"Environmental Insurance Policy" shall mean an insurance policy
insuring against loss and liability as a consequence of the presence of
legionella bacteria in the Property after the Closing Date in such form and from
such insurer and with such coverages, deductibles, and exclusions as Buyer shall
approve during the Contingency Period and insuring Buyer and naming Seller and
such other parties as Buyer shall designate during the Contingency Period as
additional insureds.
"Environmental Laws" shall mean any and all federal, state and local
laws, statutes, rules, regulations, requirements under permits issued with
respect thereto, and other requirements of any federal, state or local
governmental agency, court, board, bureau or other authority having jurisdiction
with respect to or relating to the environment, to any Hazardous Substance or to
any activity involving Hazardous Substances, and shall include, without
limitation, the Comprehensive Environmental Response, Compensation, and
Liability Act (42 U.S.C. Section 9601, et seq., the Federal Resource
Conservation and Recovery Act (42 U.S.C. Section 6901, et seq.) and all
amendments thereto in effect as of the Closing Date.
"Hazardous Substances" shall mean and include any chemical, compound,
material, mixture, waste or substance that is defined or listed in, or otherwise
classified pursuant to, any Environmental Laws as a "hazardous substance,"
"hazardous material," "hazardous waste," "extremely hazardous waste,"
"infectious waste," "toxic substance," "toxic pollutant" or any other
formulation intended to define, list, or classify substances by reason of
deleterious properties such as ignitability, corrosivity, reactivity,
carcinogenicity, or toxicity including any petroleum, natural gas, natural gas
liquids, liquified natural gas, or synthetic gas usable for fuel (or mixture of
natural gas and such synthetic gas) and including legionella bacteria.
"Hazardous Substances" shall include, without limitation, any hazardous or toxic
substance, material or waste or any chemical, compound or mixture which is (i)
asbestos, (ii) designated as a "hazardous substance" pursuant to Section 1317 of
the Federal Water Pollution Control Act (33 U.S.C. Section 1251 et seq.), (iii)
defined as a "hazardous waste" pursuant to Section 6903 of the Federal Resource
Conservation and Recovery Act, (42 U.S.C. Section 6901 et seq., (iv) defined as
"hazardous substances" pursuant to Section 9601 of the Comprehensive
Environmental Response, Compensation and Liability Act, 42 U.S.C. Section 9601
et seq.), or (v) listed in the United States Department of Transportation Table
(49 CFR 172.101) or by the Environmental Protection Agency as hazardous
substances (40 CFR part 302); or in any and all amendments thereto in effect as
of the Closing Date; or such chemicals, compounds, mixtures, substances,
materials or wastes otherwise regulated under any applicable local, state or
federal Environmental Laws.
"Hillmann" shall mean Hillmann Environmental Company, Inc., now known
as Hillmann Environmental Group.
"Improvements" shall mean all improvements and fixtures now or
hereafter located on the Land including, without limitation, the twelve (12)
story building (the "Building") constructed on the Land, together with all
appurtenances thereto and all apparatus, equipment and appliances located on the
Land and owned by Seller and used in connection with the operation and occupancy
thereof such as systems or facilities for heating, ventilation, air
conditioning, climate control, utility services, parking services, garbage
disposal, irrigation and/or recreation, and all landscaping.
"Intangible Property" shall mean Seller's rights, title and interests
in: (a) any and all transferable or assignable permits, building plans and
specifications, certificates of occupancy, operating permits, sign permits,
development rights and approvals, certificates, licenses, warranties and
guarantees, trade names, service marks, engineering, soils, pest control and
other reports relating to the Property, tenant lists, advertising materials, and
telephone exchange numbers identified with the Property; and (b) all other
transferable intangible property, miscellaneous rights, benefits or privileges
of any kind or character with respect to the Property.
"Land" shall mean the real property commonly known as 3985 Freedom
Circle, Santa Clara, California, and more particularly described in Exhibit A to
this Agreement, and all rights and interests appurtenant thereto, including but
not limited to rights under the Parking Easement Agreement and all other
easements, riparian or other water rights, rights of way and other interests
appurtenant thereto, and all right, title and interest of Seller in and to any
land lying in the bed of any street, road, highway or avenue, open or proposed,
in front of, adjacent to or adjoining such real property and in all strips and
gores.
"Laws and Restrictions" shall mean all applicable federal, state, local
and other laws, statutes, regulations, codes, orders, ordinances and rules
including, without limitation, those relating to fire, safety, land use,
subdivision, health, labor, environmental protection, seismic design,
conservation, parking, handicapped access, zoning and building, and all
restrictive covenants (if any), other title encumbrances and other obligations
affecting the Property, all Environmental Laws, all applicable provisions of the
Fair Housing Act of 1968 and the Americans With Disabilities Act of 1990, and
all amendments thereto.
"Material Exception" is defined in Section 4(c)(ix).
"Parking Easement Agreement" shall mean that certain Easement Agreement
dated July 6, 2000, and recorded on September 22, 2000 as Document No. 15400202
in the office of the Santa Clara County Clerk Recorder, as amended by First
Amendment dated October 31, 2000, recorded as Document No. 15445030 on November
2, 2000, by and between Seller and WHTS Freedom Circle Partners, L.L.C., as the
same shall be amended and restated (and recorded in the office of the Santa
Clara County Clerk Recorder) on the Closing Date as set forth in attached
Exhibit J.
"Permitted Exceptions" shall mean the exceptions to title identified as
items 1 through 14, inclusive, on Schedule B, Part 2 of the Title Commitment
attached hereto as Exhibit I.
"Personal Property" shall mean all personal property now or hereafter
owned by WHTS and conveyed to Seller, or otherwise owned by Seller, which is
used in connection with the Land, the Improvements and/or the Intangible
Property or the ownership or operation thereof including, without limitation,
all furniture, fixtures, machinery, appliances and equipment located on the
Property, other than personal property owned by tenants of the Property. A list
of the Personal Property is attached hereto as Exhibit C.
"Property" shall mean collectively the Land, the Improvements, the
Personal Property, and the Intangible Property.
"Reliance Letter" shall mean a letter in the form of Exhibit Q attached
hereto addressed to Buyer and duly signed by Hillmann.
"Scheduled Closing Date" shall mean July 7, 2003.
"Title Commitment" shall mean that title commitment issued by the Title
Company for an ALTA Extended Coverage Owner's Policy of Title Insurance in the
amount of the Purchase Price (Form B, Rev. 10/17/70), and including a commitment
for the following endorsements: CLTA endorsements numbered 100 (modified) 100.6,
103.4, 103.7, 116, 116.1, 116.4, 116.7 and 123.2, a "Fairway" endorsement, and a
"separate tax parcel" endorsement, which is attached hereto as Exhibit I.
"Title Company" shall mean First American Guaranty Company whose
address for this transaction is as follows:
First American Guaranty Company
1737 North First Street, Suite 100
San Jose, California 95112
Attn: Mike Hickey
Fax No. (408) 451-7836
"Title Policy" is defined in Section 4(c)(i).
"WHTS Modification Indemnity" shall mean a WHTS Modification Indemnity
in the form set forth in attached Exhibit T as described in Sections 4(c)(ix)
and (x).
2. Purchase And Sale. Seller agrees to sell the Property to Buyer, and
Buyer agrees to purchase the Property from Seller, subject to and on all of the
terms, covenants and conditions set forth in this Agreement. Within one (1)
business day following the Contract Date, Seller shall designate Buyer as the
"Buyer Party" under the WHTS Agreement.
3. Purchase Price. The total purchase price for the Property (the
"Purchase Price") shall be the sum of $32,750,000 which, subject to all
prorations and adjustments provided in this Agreement, shall be paid by Buyer to
Seller through escrow on the Closing Date as follows:
3.1 Deposit. Prior to the expiration of the Contingency Period,
provided Buyer does not elect to terminate this Agreement in accordance with
Section 4 below, Buyer shall deposit with the Title Company the amount of
$3,000,000 (the "Deposit"), which sum the Title Company shall deposit in a
federally insured interest-bearing "money market" account at a financial
institution reasonably acceptable to Buyer with the interest from such account
to be credited to Buyer.
3.2 Cash Payment. The balance of Purchase Price shall be paid by
Buyer to Seller or, if Seller so directs, to WHTS, by wire transfer in
immediately available federal funds on the Closing Date.
4. Review And Inspection; "As-Is" Purchase; Conditions To Agreement.
(a) Review And Inspection. During the Contingency Period,
Buyer, as the "Buyer Party" under the WHTS Agreement, shall have the right to
conduct, at its sole cost and expense, such investigations, studies, surveys,
analyses and tests on and of the Property as it shall, in its sole discretion,
determine are necessary or desirable, including, without limitation, soil tests,
environmental audits and studies, and make such evaluations as Buyer may, in its
sole and absolute discretion, determine are necessary or desirable under the
circumstances, provided that (i) the Buyer's right to enter upon and undertake
samples, tests, and borings are subject to and shall comply with the WHTS
Agreement, including as appropriate the obtaining of consent of WHTS and the
maintenance of insurance, in accordance with such agreement, (ii) Buyer, as the
"Buyer Party" under the WHTS Agreement shall only have the right to conduct
soils and groundwater tests and borings regarding the environmental condition of
the Property with Seller's prior written consent, which shall not be
unreasonably withheld or delayed, (iii) Buyer shall maintain a Three Million
Dollar ($3,000,000) combined, single limit, comprehensive general commercial
liability insurance policy with respect to the Property, issued by a licensed
insurance company naming Seller, WHTS and WHTS' property manager as additional
insureds and its consultants and subcontractors engaging any investigation of
the Property shall carry at least a One Million Five Hundred Thousand Dollar
($1,500,000) combined, single limit, comprehensive general commercial liability
insurance policy while on or about the Property; and (iv) Buyer shall defend,
indemnify, protect and hold WHTS, the Property, Seller and Seller's affiliates,
members, subsidiaries, officers, directors and agents harmless from and against
any loss, cost, damage, or expense (including without limitation, reasonable
attorneys' fees) incurred by Seller as a result of property damage, personal
injury, or mechanics' liens, to the extent arising out of Buyer's inspections of
the Property or Improvements. Without limiting the generality of the foregoing,
Buyer agrees to pay WHTS and/or Seller, upon demand, the cost of repairing and
restoring any damage or disturbance which Buyer or its agents or contractors
cause to the Property. Notwithstanding the foregoing, Buyer shall have no
liability for the discovery of any matters in, on, at, or relating to the
Property. The indemnity contained in this Section 4(a) shall survive the close
of escrow or termination of this Agreement. In order to perform the foregoing
investigations, during the Contingency Period, Buyer, its potential lenders, and
the agents, contractors, and employees for said parties shall have reasonable
access to the Property, all for the purposes of inspecting the same and
conducting tests, inspections, and analyses thereon and making evaluations
thereof, all at Buyer's expense. Buyer shall not be permitted to conduct any
borings, drillings, soils tests, or groundwater tests on the Property in
connection with the preparation of an environmental audit or in connection with
any other inspection of the Property without the prior written reasonable
consent of Seller and WHTS. Buyer shall schedule and coordinate all inspections,
including, without limitation, any environmental tests, with Seller and WHTS and
shall give Seller and WHTS at least one (1) business day's prior notice of such
test and the ability, if Seller or WHTS may so desire, to take split samples (at
no additional expense to Buyer). Seller and WHTS shall be entitled to have a
representative present at all times during each such inspection. Seller has made
available to Buyer the documents, plans, studies (environmental or otherwise)
and reports listed on Exhibit M attached hereto to the extent the same are in
Seller's possession or control. Except as specifically set forth in Section 5.1
of this Agreement or the Seller Closing Certificate, Seller makes no
representation or warranty relating to the validity of such information and
Buyer is responsible to verify such information at its discretion. Nothing
contained in this Section 4(a) shall (i) limit the representations, warranties
or indemnities made by WHTS under the WHTS Closing Certificate or the other
Closing Documents or Buyer's rights and remedies against WHTS thereunder or (ii)
limit the representations or warranties made by Seller under the Seller Closing
Certificate and/or Section 5.1 of this Agreement. In conducting the inspection
of the Property, Buyer shall at all times comply with all laws and regulations
of all applicable governmental authorities, and Buyer shall not contact or have
any discussions with any of WHTS' employees, agents or representatives, or with
any contractors providing services to the Property unless in each case Buyer
obtains the prior consent of WHTS, it being agreed that all such contacts or
discussions shall, pending any such approval, be directed to Carl Shannon at
(415) 536-1850.
(b) Termination During Contingency Period. Buyer may, at any
time during the Contingency Period, for any reason or no reason, (i) terminate
this Agreement by delivering to Seller its written notice of termination prior
to the expiration of the Contingency Period, or (ii) waive its right to
terminate this Agreement by, prior to the expiration of the Contingency Period,
(a) waiving its termination right in writing and delivering such waiver to
Seller, (b) timely delivering the Additional Deposit to the Title Company, and
(c) delivering to Seller either (x) a pro forma of the Environmental Insurance
Policy or (y) its written waiver of the condition precedent set forth in Section
4(c)(xii). In the event Buyer (1) fails to provide a written waiver of its right
to terminate in accordance with the foregoing no later than 5 p.m. Pacific time
on the last day of the Contingency Period, (2) fails to deposit the Additional
Deposit with the Title Company no later than 5 p.m. Pacific time on the last day
of the Contingency Period, or (3) fails to either deliver the pro forma of the
Environmental Insurance Policy to Seller or deliver its election in writing to
waive the condition precedent set forth in Section 4(c)(xii), by 5 p.m. Pacific
time on the last day of the Contingency Period, then this Agreement shall
automatically terminate. In the event of any automatic termination or other
termination by Buyer pursuant to this Section 4(b), (x) the Initial Deposit and
all other funds deposited in escrow by Buyer and all interest accrued on such
funds (less Buyer's share of any escrow and title cancellation fees) shall be
returned immediately to Buyer, (y) all documents deposited in escrow by Buyer or
Seller shall be returned to the depositing party, and (z) Buyer shall promptly
deliver to Seller, at no cost to Seller, and without representation or warranty,
the originals or copies of all tests, reports and inspections of the Property,
which do not restrict such delivery to a third party, made and conducted by
Buyer or for Buyer's benefit which are in the possession or control of Buyer and
promptly return to Seller copies of all materials delivered by Seller or WHTS to
Buyer and shall destroy all copies and abstracts thereof, and except for this
Section and the provisions of this Agreement that expressly survive the
termination of this Agreement, this Agreement shall be null and void and of no
further force and effect, and neither Seller nor Buyer shall have any further
rights or obligations hereunder.
(c) Conditions Precedent. Seller's obligation to sell the
Property to Buyer shall be conditioned upon (A) the acquisition of the Property
by PMC or its affiliate on the terms set forth in the WHTS Agreement (or such
other terms reasonably acceptable to Seller), and (B) the issuance of (or
irrevocable commitment of the applicable insurer to issue concurrently with the
close of escrow) the Environmental Insurance Policy. In addition, Buyer's
obligation to purchase the Property shall be conditioned expressly upon the
fulfillment of each of the following conditions precedent on or before the
Closing Date:
(i) The issuance by the Title Company, or the
irrevocable binding commitment of the Title Company to issue, to Buyer, on the
Closing Date, conditioned only upon payment of the Title Company's
regularly-scheduled premium, the title policy ("Title Policy") described in the
Title Commitment, including the endorsements described in the Title Commitment,
insuring Buyer that fee simple absolute title to the Property is vested, free
and clear of all liens and encumbrances except for the Permitted Exceptions.
(ii) Subject to Section 8 of this Agreement, there shall
have been no material adverse change in the condition of the Property, or any
portion thereof.
(iii) There are no contracts, other than the Permitted
Exceptions, that certain Master License Agreement dated May 4, 2001 by an
between TishmanSpeyer Properties and Ad Walls, LLC, and any other agreements
approved in writing by Buyer, which will affect the Property or be binding upon
Buyer on or after the Closing Date.
(iv) From and after the Contract Date, WHTS has not
failed in any material respect to perform the items described in clauses (i)
through (vi) of Section 5.3(a) below.
(v) From and after the Contract Date, WHTS has not
removed or permitted the removal of any Personal Property or any fixtures from
the Property except to the extent such items were replaced with Personal
Property or fixtures of equal or greater value.
(vi) The acquisition of fee title to the Property by PMC
or its affiliate, and the termination of the WHTS Lease.
(vii) The execution, acknowledgement, and delivery by
WHTS and the owner of the Adjacent Property of an Amended and Restated Parking
Easement Agreement in the form attached hereto as Exhibit J to escrow, the
recordation thereof in the office of the Santa Clara County Clerk Recorder and
the recorded subordination thereto by the holder of any deed of trust or other
foreclosable document or instrument currently encumbering the Adjacent Property,
all on or prior to the Closing Date.
(viii) The execution and delivery by Hillmann to escrow
for delivery to Buyer at the close of escrow of the Reliance Letter, provided,
however, that if the Reliance Letter is not then in fact delivered to Buyer at
the close of escrow, this condition shall be deemed to have failed. Seller
cannot and does not make any warranty or representation whatsoever concerning
the completeness or the accuracy of any matters contained in the Reliance
Letter.
(ix) The execution by the parties thereto and delivery
to escrow for the delivery to Buyer at the close of escrow of the Closing
Certificates; provided however, that if the Closing Certificates are not then in
fact delivered to Buyer at the close of escrow this condition shall be deemed to
have failed. Notwithstanding the foregoing, if WHTS includes any matter on
Schedule 2 to the WHTS Closing Certificate and all matters on Schedule 2 to the
WHTS Closing Certificate, when taken together, constitute a "Material Exception"
(as hereinafter defined), Buyer shall have the right to terminate this
Agreement. Upon any such termination, upon Buyer's demand, the Deposit will be
returned by the Title Company to Buyer (and Seller shall so instruct the Title
Company) and, subject to the provision for reimbursement of expenses under
certain circumstances set forth in this Section 4(c)(ix), this Agreement shall
terminate and be of no further force or effect, except for those provisions that
expressly survive the termination hereof. If this Agreement is not so terminated
by Buyer, then Seller and Buyer shall consummate this transaction in accordance
with this Agreement. If WHTS includes any matter on Schedule 2 to the WHTS
Closing Certificate, but all of the matters on Schedule 2 to the WHTS Closing
Certificate do not in the aggregate constitute a Material Exception (as
hereinafter defined), then (1) Buyer shall have no right to terminate this
Agreement pursuant to this Section 4(c)(ix), and (2) the additional condition
precedent described in Section 4(c)(x) shall apply and (3) subject to the terms
and conditions of this Agreement, Seller and Buyer shall consummate this
transaction without any abatement in the Purchase Price as a result of that
matter (so long as the condition precedent described in Section 4(c)(x) is
satisfied). Furthermore, if Buyer terminates this Agreement pursuant to this
Section 4(c)(ix) and a matter set forth on Schedule 2 to the WHTS Closing
Certificate, which alone or together with other matters thereon, gave rise to
the termination right, makes the representations and warranties made by WHTS in
Section 5.1 of the WHTS Agreement false when made (a copy of which Section 5.1
is attached hereto as Exhibit B, and which shall not be modified by Seller),
then Seller, upon Buyer's written request, shall pay to Buyer an amount equal to
all of Buyer's out-of-pocket costs incurred by Buyer in connection with this
transaction, including but not limited to its legal expenses relating to this
transaction, non-refundable loan fees, and its studies, inspections and
investigations of the Property during the Contingency Period, but in no event to
exceed $250,000 provided, however, that Seller's obligation to make this payment
shall be limited to the amount collected by Seller (and Seller shall exercise
its reasonable and diligent efforts to so collect) (or which could reasonably
have been collected by Seller, assuming all reasonable diligence in attempted
collection) pursuant to Section 4(c)(viii) of the WHTS Agreement (a copy of
which Section 4(c)(viii) is attached hereto as Exhibit D and which shall not be
modified by Seller). For the purposes of this Section 4(c)(ix), the matters set
forth on Schedule 2 to the WHTS Closing Certificate shall be deemed a "Material
Exception," if, but only if, all of the matters included on Schedule 2 to the
WHTS Closing Certificate, when taken together, would reasonably be expected to
result in additional cost, expense, liability and/or damage to Buyer (after
factoring in all cost of litigating, resolving, and/or defending the matter, any
reduction in the fair market value of the Property, any contingent liability,
and the cost of any delay in the lease-up of the Property) in excess of Five
Hundred Thousand Dollars ($500,000). The provisions of this Section 4(c)(ix)
shall survive the close of escrow and the termination of this Agreement. In
addition, the provisions of this Section 4(c)(ix) shall be subject to Section 8
of this Agreement and shall not apply to any events covered thereunder.
(x) If, but only if, required pursuant to Section
4(c)(ix) above, the delivery to escrow for delivery to Buyer at the close of
escrow of the WHTS Modification Indemnity; provided however, that if the WHTS
Modification Indemnity is not then in fact delivered to Buyer at the close of
escrow this condition shall be deemed to have failed. The WHTS Modification
Indemnity shall be subject to the limitations set forth in the WHTS Closing
Certificate.
(xi) The execution, acknowledgement, and delivery to
escrow by WHTS and the owner of the Adjacent Property of the Development
Indemnity Agreement and the recordation of the Development Indemnity Agreement
in the office of the Santa Clara County Clerk Recorder, all on or prior to the
Closing Date.
(xii) The issuance of the Environmental Insurance
Policy. Buyer shall use good faith efforts to obtain the Environmental Insurance
Policy, and Seller shall reasonably cooperate with Buyer in connection with the
obtaining of the Environmental Insurance Policy.
(xiii) The performance by Seller of its obligations
under Section 6.3 of this Agreement.
At any time or times on or before the Scheduled Closing Date, Buyer may waive
any of the foregoing conditions by written notice to Seller. Other than Buyer's
close of escrow pursuant to this Agreement which shall waive all such
unfulfilled conditions, no waiver shall be effective unless made in writing
specific as to the conditions or matters so waived.
In the event that any of the conditions precedent to Buyer's obligation to
purchase the Property in this Section 4(c) are not satisfied or otherwise waived
by Buyer on or before July 8, 2003 (other than a failure of a condition
precedent caused by a breach of Buyer's obligations under this Agreement), then
Buyer shall have the right to terminate this Agreement by delivering to Seller
written notice of such termination in which event the Deposit shall be returned
immediately to Buyer. If Buyer terminates this Agreement pursuant to the
preceding sentence and the failure of such condition precedent was caused by the
breach by WHTS of the WHTS Agreement or a breach by Seller under this Agreement,
then Seller, upon Buyer's written request, shall pay to Buyer an amount equal to
all of Buyer's out-of-pocket costs incurred by Buyer in connection with this
transaction, including but not limited to its legal expenses relating to this
transaction and its studies, inspections and investigations of the Property (but
excluding loan fees), but in no event to exceed $175,000. Seller's obligation
under the preceding sentence shall not be subject to the $100,000 floor set
forth in the last paragraph of Section 5.1.
(d) AS IS Purchase. Buyer acknowledges that Buyer will have
had the opportunity to conduct prior to the Closing Date, such studies and
investigations of the Property as Buyer desires, and that Buyer will have had
the right to observe to its satisfaction, and will have observed to its
satisfaction, the physical characteristics and condition of the Property.
Nothing contained in this Section 4(d) shall (i) limit the representations,
warranties or indemnities made by WHTS under the WHTS Closing Certificate or the
other Closing Documents or Buyer's rights and remedies against WHTS thereunder
or (ii) limit the representations or warranties made by Seller under the Seller
Closing Certificate and/or Section 5.1 of this Agreement. Except as expressly
set forth in the Closing Documents or this Agreement, Buyer acknowledges and
agrees that the Property is to be purchased and accepted by Buyer in its
condition as of the Closing Date, "AS IS", without any implied or express
warranty or representation by Seller or anyone acting or purporting to act on
Seller's behalf ("Seller's Agents"), and with all patent and latent defects. No
representations or warranties, express or implied regarding the Property or
matters affecting the Property have been or will be made with respect to the
Property or the subject matter of this Agreement (i) by Seller or Seller's
Agents, except as expressly set forth in the Seller Closing Certificate and/or
Section 5.1 of this Agreement, or (ii) by any other person or entity (including
without limitation WHTS, or anyone acting or claiming to act on WHTS' behalf
(other than Seller and Seller's Agents)), except as expressly set forth in the
Closing Documents. Without limiting the foregoing, Buyer acknowledges that no
representation is or will be made concerning the physical condition,
environmental, economic, or legal condition of the Property, title to or the
boundaries of the Property, topography, climate, air, water rights, utilities,
leases, water, present and future zoning, physical condition, soil condition,
pest control matters, engineering characteristics, traffic patterns, purposes to
which the Property may be suited, value, potential for development,
contamination, drainage, access to public roads, proposed routes of roads or
extensions thereof, and compliance with building, health, safety laws,
Environmental Laws, land use laws and regulations to which the Property may be
subject or any other matter in any way affecting the Property, or the use or
ownership thereof (herein collectively the "Property Matters") (i) by Seller or
Seller's Agents, except as expressly set forth in the Seller Closing Certificate
and/or Section 5.1 of this Agreement, or (ii) by any other person or entity
(including, without limitation, WHTS or anyone acting or claiming to act on
WHTS' behalf (other than Seller and Seller's Agents)), except as expressly set
forth in the Closing Documents. Buyer acknowledges that, although Seller has
disclosed, made available, or caused WHTS to make available documents and
reports concerning the Property, that Seller cannot and does not make any
warranty or representation whatsoever concerning the completeness or the
accuracy of information contained in such documents and reports and that Buyer
is not relying upon any such representations and warranties, other than (i) with
respect to Seller and Seller's Agents, those expressly set forth in the Seller
Closing Certificate and/or Section 5.1 of this Agreement, and (ii) with respect
to any other person or entity (including, without limitation, WHTS and those
acting or purporting to act on behalf of WHTS (other than Seller and Seller's
Agents)), those expressly set forth in the Closing Documents. Buyer further
acknowledges that it has not received from Seller, WHTS or anyone acting or
claiming to act on their behalf, any accounting, tax, legal, architectural,
engineering, property management, environmental or other advice with respect to
this transaction and is relying solely upon the advice of its own accounting,
tax, legal, architectural, engineering, property management, environmental and
other advisors. Furthermore, the representations and warranties of Seller and
Seller's Agents set forth in this Agreement or otherwise made in any form (other
than in the Seller's Closing Certificate) are merged into the deed at the
closing.
THEREFORE, EXCEPT AS EXPRESSLY SET FORTH IN SECTION 5.1 OF THIS AGREEMENT AND
THE SELLER CLOSING CERTIFICATE, SELLER MAKES NO REPRESENTATIONS OR WARRANTIES,
EXPRESS OR IMPLIED, DIRECTLY OR INDIRECTLY TO BUYER, AND SELLER IS TRANSFERRING
THE PROPERTY TO BUYER, AND BUYER IS PURCHASING THE PROPERTY FROM SELLER, WITHOUT
RECOURSE TO SELLER, IN ITS "AS IS" CONDITION ON THE CLOSING DATE, AND BUYER, FOR
THE EXPRESS BENEFIT OF SELLER, IS ASSUMING ON THE CLOSING DATE THE RISK THAT
ADVERSE PHYSICAL, ENVIRONMENTAL, ECONOMIC OR LEGAL CONDITIONS MAY NOT HAVE BEEN
REVEALED BY ITS INVESTIGATION; PROVIDED, HOWEVER, THAT NOTHING IN THIS
SUBPARAGRAPH SHALL BE DEEMED TO BE A WAIVER BY BUYER OF ANY CLAIMS BUYER MAY
HAVE AGAINST WHTS OR ANY PARTY (OTHER THAN SELLER AND SELLER'S AGENTS) PURSUANT
TO THE WHTS CLOSING CERTIFICATE AND THE OTHER CLOSING DOCUMENTS.
The acknowledgments contained in this Section constitute a conclusive admission
that (a) Buyer is a sophisticated, knowledgeable investor in commercial
property, and (b) without waiving any claims Buyer may have against WHTS or any
party (other than Seller and Seller's Agents) pursuant to the WHTS Closing
Certificate and the other Closing Documents, Buyer is relying upon its own
judgment as to any matter germane to the Property, or its purchase or
contemplated use thereof, and not on the judgment of Seller or any Seller Agent,
and (c) except as expressly set forth in the Seller Closing Certificate, any
statement by Seller or any Seller Agent with respect to any Property Matter,
whether oral, written, constructive express or implied, is immaterial to Buyer.
Except with respect to any claims against Seller arising out of any breach of
covenants, representations or warranties set forth in the Seller Closing
Certificate, effective as of the Closing Date, Buyer, for itself and its agents,
affiliates, successors and assigns ("Buyer Parties"), hereby releases and
forever discharges Seller, its affiliates, successors and assigns, and their
respective officers, directors, shareholders, employees and agents, from any and
all rights, claims and demands at law or in equity, whether known or unknown at
the time of this Agreement, which Buyer has or may have in the future, arising
out of the Property or the Property Matters, including, without limitation, any
claims for indemnification or contribution arising under the Comprehensive
Environmental Response, Compensation, and Liability Act (42 U.S.C. Section 9601
et seq.) or any similar federal, state or local statute, rule or ordinance
relating to liability of property owners for environmental matters, or arising
due to the presence of LPB (as defined in Section 5.2(c)) at the Property.
In giving the foregoing releases, Buyer expressly waives the provisions of
California Civil Code Section 1542 as it applies to the foregoing mutual
release, which provides as follows:
"A general release does not extend to claims which
the creditor does not know or suspect to exist in his
favor at the time of executing the release, which if
known by him must have materially affected his
settlement with the debtor."
This Section 4(d) shall survive the close of escrow. Buyer hereby specifically
acknowledges that Buyer has carefully reviewed this subsection and discussed its
import with legal counsel and that provisions of this subsection are a material
part of this Agreement.
5. Representations, Warranties, Covenants And Agreements.
5.1 Representations And Warranties Of Seller. Seller hereby makes
the following representations and warranties to and for the benefit of Buyer,
each of which representations and warranties (i) is material and being relied
upon by Buyer, (ii) is made as an inducement to Buyer to enter into this
Agreement and consummate the transaction contemplated hereby, (iii) is true in
all respects as of the date of this Agreement, (iv) shall be true in all
material respects on the Closing Date, and (v) shall survive the close of
escrow, but such survival shall be limited as set forth in this Section 5.1.
(a) Seller is a Delaware corporation and has the full power,
authority and legal right to enter into and perform this Agreement. The
execution, delivery and performance of this Agreement have been duly authorized
by all necessary action on the part of the Seller.
(b) Seller has no actual knowledge of any pending or
threatened actions or proceedings before any court or administrative agency
which would reasonably be expected to materially adversely affect the ability of
Seller to perform Seller's obligations under this Agreement.
(c) Seller is not a "foreign person" as defined in Internal
Revenue Code Section 1445 and any related regulations. At the closing, Buyer
will have no duty to collect withholding Taxes for Seller pursuant to the
Foreign Investment in U.S. Real Property Tax Act of 1980, as amended.
(d) Seller has not (i) made a general assignment for the
benefit of creditors, (ii) filed any voluntary petition in bankruptcy or
suffered the filing of any involuntary petition by its creditors; (iii) suffered
the appointment of a receiver to take possession of all or substantially all of
its assets; or (iv) suffered the attachment or other judicial seizure of all or
substantially all of its assets.
(e) Seller has made available to Buyer all reports and
documents made available to Seller by WHTS pursuant to the WHTS Agreement
including, without limitation, those listed on Exhibit M attached hereto to the
extent such documents are in Seller's possession or control, and PMC does not
have reason to believe that WHTS has failed to make available to Seller any
reports or documents in WHTS' control relating to the physical, environmental,
economic or legal condition of the Property; provided, however, that Seller
cannot and does not make any warranty or representation whatsoever concerning
the completeness or the accuracy of information contained in such documents and
reports.
(f) There are no documents or reports in Seller's possession
or under Seller's control, that contain information that would lead a reasonably
prudent buyer to conclude that the physical, environmental, economic or legal
condition of the Property is materially and adversely inconsistent with that
represented in the documents and reports made available to Buyer prior to June
16, 2003.
The representations and warranties of Seller contained in this Section 5.1 shall
survive the Closing for one (1) year following the Closing Date (the "Limitation
Period") except that the Limitation Period with respect to the representations
and warranties of Seller contained in clauses (b) and (e) of this Section 5.1
shall be two (2) years. Each such representation and warranty shall
automatically be null and void and of no further force and effect following the
expiration of the applicable Limitation Period unless, prior to such expiration,
Buyer shall have provided Seller with a written notice alleging that Seller
shall be in breach of such representation or warranty and specifying in
reasonable detail the nature of such breach. Any legal proceeding against Seller
for such breach must be commenced, if at all, within ninety (90) days after the
expiration of the applicable Limitation Period.
Notwithstanding anything to the contrary set forth in this Agreement, Seller's
liability for breach of any covenant, representation or warranty of Seller
contained in this Agreement and in any document executed by Seller pursuant to
this Agreement, including any instruments delivered at Closing, shall, subject
to the limitations of survival set forth in this Section 5.1 be limited to
claims in excess of One Hundred Thousand Dollars ($100,000) in the aggregate
(but once the aggregate exceeds $100,000, Seller shall be liable to the full
extent of such claims), and Seller's aggregate liability for any and all claims
arising out of any such covenants, representations and warranties shall not
exceed Five Million Dollars ($5,000,000).
5.2 Representations And Warranties Of Buyer. Buyer hereby makes
the following representations and warranties to and for the benefit of Seller,
each of which representations and warranties (i) is material and being relied
upon by Seller, (ii) is made as an inducement to Seller to enter into this
Agreement and consummate the transaction contemplated hereby, (iii) is true in
all respects as of the date of this Agreement, (iv) shall be true in all
material respects on the Closing Date, and (v) shall survive the close of
escrow:
(a) Buyer is a Delaware limited liability company and it has
the full power, authority and legal right to enter into and perform this
Agreement. The execution, delivery and performance of this have been duly
authorized by all necessary action on the part of Buyer.
(b) Buyer has not (i) made a general assignment for the
benefit of creditors; (ii) filed any voluntary petition in bankruptcy or
suffered the filing of any voluntary petition by its creditors; (iii) suffered
the appointment of a receiver to take possession of all or substantially all of
its assets; or (iv) suffered the attachment or other judicial seizure of all or
substantially all of its assets.
(c) Buyer expressly acknowledges that it is aware that
legionella pneumophila bacterium ("LPB") has been present at the Property, and,
except as expressly provided in the Closing Certificates, Buyer shall make and
rely solely on its own independent investigation and WHTS' representations and
warranties under the WHTS Closing Certificate with respect thereto.
Buyer's liability for breach of any covenant, representation or
warranty of Buyer contained in the Agreement, shall be limited to claims in
excess of One Hundred Thousand Dollars ($100,000) in the aggregate, and Buyer's
aggregate liability for any and all claims arising out of any such covenants,
representations and warranties shall not exceed Five Million Dollars
($5,000,000).
5.3 Agreements. Each of Buyer and Seller hereby specifically
agrees as follows:
(a) From the date of this Agreement to the Closing Date,
Seller shall use reasonable efforts to enforce WHTS' obligations under the WHTS
Agreement to (i) manage, maintain, operate, and service the Property, to the
same standard as existed at the Contract Date so as to keep the Property and
every portion thereof in the same working order and repair as existed on the
Contract Date, (ii) not remove or permit the removal of any Personal Property or
any fixtures from the Property unless such items are replaced immediately with
Personal Property or fixtures of equal or greater value, (iii) comply, in all
material respects, with all Laws and Restrictions with respect to the Property,
(iv) not modify, terminate, cancel, extend, or amend any lease, contracts or
arrangements which will affect the Property or be binding upon the Buyer on or
after the Closing Date without the consent of Buyer, which consent shall not be
unreasonably withheld, conditioned or delayed, (v) not enter into any leases or
other agreements with respect to the occupancy, maintenance or improvement of
the Property that continue after the Closing Date without Buyer's prior written
approval (which Buyer may withhold in its sole discretion), and (vi) maintain in
full force and effect all of the insurance policies and coverages currently in
effect with respect to the Property. From the date of this Agreement to the
earlier of the Scheduled Closing Date or the termination of this Agreement,
Seller shall not lease, sublease, assign or otherwise transfer the WHTS Lease,
the Property, or any portion thereof or interest therein (except to a party
which has assumed the obligations of Seller under this Agreement).
(b) Immediately upon its acquisition of the Property, Seller
shall terminate the WHTS Lease, by merger or otherwise, if Seller acquires title
to the Property.
(c) Provided (i) all of the conditions precedent in Section
4(c) of this Agreement and Section 4(c) of the WHTS Agreement are satisfied on
or before the Closing Date, (ii) this Agreement is not terminated pursuant to
Section 4(b) of this Agreement or otherwise in accordance with the terms of this
Agreement or applicable law, (iii) WHTS fully tenders its performance of all of
its obligations under the WHTS Agreement to sell the Property to Seller in
accordance with the WHTS Agreement and (iii) Buyer fully tenders its performance
of all of its obligations under this Agreement to purchase the Property from
Seller in accordance with this Agreement, then Seller shall purchase the
Property from WHTS as permitted by and in accordance with the WHTS Agreement;
provided, however, that a failure in the foregoing shall not excuse performance
by Seller hereunder to the extent such failure is caused by Seller's breach of
this Agreement or the WHTS Agreement or by the acts or omissions of Seller made
for the purpose of causing such failure. Seller shall use reasonable efforts to
not cause the failure of any of the foregoing.
(d) Seller shall promptly notify Buyer in writing of any
event or circumstance known to Seller which materially adversely affects
Seller's ability to perform its obligations under this Agreement in a timely
manner or the likelihood of timely satisfaction of the conditions precedent set
forth above.
(e) Seller shall promptly notify Buyer in writing if Seller
becomes aware of any fact or occurrence that would render any of its
representations or warranties under Section 5.1 above untrue, or would render it
unable to deliver the Closing Certificates on the Closing Date.
(f) Seller shall pay at the close of escrow the cost of the
one-time premium for the Environmental Insurance Policy (the "Insurance
Premium") up to a maximum of Two Hundred Thousand ($200,000) and Buyer shall pay
at the close of escrow the cost of the Insurance Premium in excess of said
amount.
(g) Seller shall promptly forward to Buyer any notice
delivered prior to the Closing Date by WHTS to Seller with respect to the
Property pursuant to the WHTS Agreement.
(h) On the Closing Date, Seller shall deliver possession of
the Property to Buyer free and clear of any leases, occupancy agreements,
occupants or other parties in possession.
6. TITLE, ESCROW AND CLOSING.
6.1 Conditions Of Title. On the Closing Date, Seller shall deliver
to Escrow Holder a deed in the form attached hereto as Exhibit E (the "Deed").
6.2 Closing Date. Subject to the conditions precedent herein set
forth, through an escrow established with the Title Company, Buyer and Seller
shall consummate this transaction on the Scheduled Closing Date or such other
date upon which Buyer and Seller may mutually agree.
6.3 Deposits And Deliveries By Seller. Subject to the conditions
precedent herein set forth and the terms and conditions of this Agreement,
Seller shall deposit or cause to be deposited into escrow with the Title Company
for delivery to Buyer or such person as Buyer shall designate, or deliver
directly to Buyer outside of escrow, on or before the Scheduled Closing Date,
the following documents duly executed and acknowledged as required:
(a) The Deed.
(b) A Bill of Sale and Assignment of Intangible Property in
the form attached hereto as Exhibit F transferring the Personal Property and
Intangible Property to Buyer (the "Bill of Sale").
(c) An Affidavit of Non-Foreign Status in form attached
hereto as Exhibit H (the "Non-Foreign Affidavit) and a California Form 597-W
(the "California Affidavit").
(d) A Closing Certificate in the form of attached Exhibit O.
(e) Seller's written escrow instructions to close escrow in
accordance with the terms of this Agreement.
(f) Evidence reasonably acceptable to Buyer's counsel that
the documents delivered to Buyer by Seller at closing have been duly authorized
by Seller and duly executed on behalf of Seller.
(g) Wire transfer of immediately available funds in the
amount of Seller's obligation pursuant to Section 5.3(f) or a credit towards the
Purchase Price in such amount.
(h) Such other documents, resolutions, consents and
affidavits required to effect the valid consummation of the transaction
evidenced by this Agreement.
6.4 Deposits And Deliveries By Buyer. Subject to the conditions
precedent herein set forth, Buyer shall deposit or cause to be deposited into
escrow with the Title Company for delivery to Seller or such person as Seller
shall designate, or deliver directly to Seller outside of escrow, on or before
the Scheduled Closing Date, each of the following documents duly executed and
acknowledged as required and funds:
(a) Wire transfer of immediately available funds, which,
together with the Deposit, shall equal the Purchase Price (the "Purchase
Funds").
(b) Cash, wire transfer, cashier's check, or other
immediately available funds covering Buyer's share of closing costs and
prorations.
(c) Intentionally Deleted.
(d) A closing certificate confirming the accuracy and
completeness, in all material respects, as of the Closing Date of each
representation and warranty made herein by Buyer.
(e) Buyer's written escrow instructions to close escrow in
accordance with the terms of this Agreement.
(f) Evidence reasonably acceptable to Seller's counsel that
the documents delivered to Seller by Buyer at closing have been duly authorized
by Buyer and duly executed on behalf of Buyer.
(g) Intentionally Deleted.
(h) Such other documents, resolutions, consents and
affidavits required to effect the valid consummation of the transaction
evidenced by this Agreement.
6.5 Closing. Upon satisfaction of the conditions to the Closing,
the parties shall instruct the Title Company to close escrow by concurrently:
(a) Recording and arranging for delivery to Buyer of the duly
executed original Deed, showing all recording information.
(b) Issuing to Buyer the Title Policy.
(c) Recording the originals of, and arranging for delivery to
Buyer of one certified copy of the duly executed and recorded, Parking Easement
Agreement and Development Indemnity Agreement and the subordinations and
recognitions thereto required by Sections 4(c)(vii) and (xi).
(d) Delivering or arranging for delivery to Buyer of an
original, duly executed Bill of Sale, the Non-Foreign Affidavit, the California
Affidavit, Seller's Closing Certificate, WHTS Closing Certificate, WHTS
Modification Indemnity (if applicable) and the Reliance Letter.
(e) Delivering to Seller (or as directed by Seller) the
Purchase Price, after deducting Seller's share of closing costs and prorations.
(f) Taking of all actions, and delivering to Buyer and Seller
of copies of all other documents and things deposited and/or delivered through
escrow as directed by the parties pursuant to their mutually consistent escrow
instruction.
6.6 Prorations. The costs and expenses of the Property shall be
prorated as follows:
(a) Maintenance expenses and taxes, insurance, utilities,
management, service and operating expenses shall be prorated between Seller and
Buyer as of the Closing Date. Expenses shall be prorated on the basis of the
actual number of days in a month.
(b) All items subject to proration pertaining to the period
prior to the Closing Date shall be credited to Seller, and all such prorations
pertaining to the period on or following the Closing Date shall be credited to
Buyer. Seller, Buyer and Title Company shall cooperate to produce prior to the
Closing Date a schedule of prorations to be made as of the Closing Date as
complete and accurate as reasonably possible. All prorations which can be
liquidated accurately or reasonably estimated as of the Closing Date shall be
made in escrow on the Closing Date. All other prorations, and adjustments to
initial estimated prorations, shall be made by Buyer and Seller with due
diligence and cooperation within 30 days following the Closing Date, or such
later time as may be required to obtain necessary information for proration, by
cash payment to the party yielding a net credit from such prorations from the
other party. Such cash payment shall be made within ten (10) business days of
demand for payment by the party entitled to receive such payment.
(c) The provisions of this Section 6.6 shall survive the
close of escrow.
6.7 Closing Costs. Seller shall pay (i) the cost of the County of
Santa Clara transfer tax, (ii) the basic CLTA portion (with no endorsements) of
the title insurance premiums for the title insurance described in the Title
Commitment, (iii) one-half of all escrow fees and (iv) Seller's legal fees and
costs incurred in connection with the contemplated transaction. Buyer shall pay
(i) the balance of the title insurance premium (including costs for
endorsements), (ii) recording fees, (iii) one-half of all escrow fees, (iv)
Buyer's legal fees and costs incurred in connection with the contemplated
transaction and (v) all costs and expenses incurred in connection with any
financing obtained by Buyer, including without limitation, loan fees, mortgage
recording taxes, financing costs and lender's legal fees (if applicable). Any
applicable city transfer tax shall be shared equally by Buyer and Seller. All
other closing costs shall be borne by Seller and/or Buyer in the manner which is
customary in the county where the Land is located. Notwithstanding the
foregoing, if close of escrow fails to occur as a consequence of the default by
a party, then such party shall pay all escrow fees and cancellation fees owing
to the Title Company.
6.8 Possession. Right to possession of the Property shall transfer
to Buyer on the Closing Date.
6.9 Filing Of Reports. Title Company shall be solely responsible
for the timely filing of any reports or returns required pursuant to the
provisions of Section 6045(e) of the Internal Revenue Code of 1986 (and any
similar reports or returns required under any state or local laws) in connection
with the closing of the transaction contemplated in this Agreement.
6.10 Cooperation. Without further consideration, each of Seller
and Buyer shall execute, acknowledge and deliver to the other party on or after
the Closing Date any and all other instruments or documents, and do and perform
any other acts which may be required or which the other party may reasonably
request in order to fully assign, transfer and/or convey to Buyer, and vest in
Buyer, the Property, and each and every part and component thereof.
7. Liquidated Damages. IN THE EVENT THAT BUYER FAILS TO PURCHASE THE
PROPERTY AFTER (I) ALL OF THE CONDITIONS TO THE BUYER'S OBLIGATION TO PURCHASE
THE PROPERTY SHALL HAVE BEEN SATISFIED, OR WAIVED IN WRITING BY BUYER AND (II)
THE SELLER SHALL HAVE PERFORMED, TENDERED (OR OFFERED TO TENDER) PERFORMANCE OF
ITS OBLIGATIONS, THEN THE DEPOSIT SHALL BE PAID BY TITLE COMPANY TO SELLER AS
LIQUIDATED DAMAGES. BUYER AND SELLER HEREBY ACKNOWLEDGE AND AGREE THAT SELLER'S
DAMAGES WOULD BE DIFFICULT OR IMPOSSIBLE TO DETERMINE AND THE AMOUNT OF THE
DEPOSIT IS THE PARTIES' BEST AND MOST ACCURATE ESTIMATE OF THE DAMAGES SELLER
WOULD SUFFER IN THE EVENT THE TRANSACTION PROVIDED FOR IN THIS AGREEMENT FAILS
TO CLOSE UNDER THE FOREGOING CONDITIONS, AND IS REASONABLE UNDER THE
CIRCUMSTANCES EXISTING AS OF THE DATE OF THIS AGREEMENT. BUYER AND SELLER AGREE
THAT THE SELLER'S RIGHT TO RETAIN THE DEPOSIT SHALL BE THE SOLE AND EXCLUSIVE
REMEDY OF SELLER IN THE EVENT OF SUCH A BREACH OF THIS AGREEMENT BY BUYER.
- ----------------------------- ----------------------------
BUYER SELLER
8. Damage And Destruction; Condemnation. Seller shall notify Buyer
immediately of the occurrence of any damage to or destruction of the Property,
or the institution or maintenance of any condemnation or similar proceedings
with respect to the Property prior to the Closing Date of which Seller is aware.
In the event of any damage to or destruction of the Property prior to the
Closing Date for which the cost to repair in the aggregate exceeds $500,000, or
in the event any condemnation or similar proceedings are instituted or
maintained prior to the Closing Date, Buyer at its option either (i) may
terminate this Agreement by written notice to Seller prior to the Closing Date,
or (ii) may consummate the purchase evidenced by this Agreement. With respect to
any damage to or destruction of the Property prior to the Closing Date for which
the cost to repair does not in the aggregate exceed $500,000 , Buyer shall have
no right to terminate this Agreement pursuant to the preceding sentence, this
Agreement shall continue in accordance with its terms and the Purchase Price
shall be reduced by the Restoration Funds (as defined below). As used herein,
"Restoration Funds" shall mean an amount equal to the actual costs and expenses
directly and indirectly related to the restoration of the Property, including
the costs of permits less the actual proceeds of insurance assigned to Buyer at
the Closing, but not exceeding the estimated cost of the restoration as
reasonably determined and agreed upon by Buyer, Seller and WHTS based on bids
for a guaranteed maximum price contract for the restoration, which may include
appropriate contingencies for cost overruns reasonably agreed upon by Buyer,
Seller and WHTS. If Buyer, Seller and WHTS do not reasonably agree on the amount
of the Restoration Funds and reasonable contingencies in connection therewith
prior to the Closing Date, then Buyer shall have the right to terminate this
Agreement as described above prior to the Closing Date. If this Agreement is not
terminated by Buyer pursuant to this Section 8, then (i) Buyer shall accept
possession of the Property in such damaged condition and/or subject to such
condemnation or other proceeding on the Closing Date, (ii) as of the Closing
Date, Seller shall assign to Buyer all insurance proceeds or condemnation
proceeds received or to be received by Seller as a result of such damage or
taking, and (iii), if applicable, the Purchase Price shall be reduced by the
amount of the Restoration Funds. If this Agreement is so terminated by Buyer,
then Buyer shall be entitled to an immediate return of the Deposit.
9. Commissions.
(a) Each party to this Agreement warrants to the other that except
for the fees set forth in Section 9(b) due to Colliers International and Cornish
& Carey (the "Approved Broker"), no person or entity can properly claim a right
to a real estate commission, real estate finder's fee, real estate acquisition
fee or other real estate brokerage-type compensation (collectively, "Real Estate
Compensation") based upon the acts of that party with respect to the transaction
contemplated by this Agreement, and each party hereby agrees to indemnify,
defend and protect the other against and to hold the other harmless from any
loss, cost or expense (including but not limited to attorneys' fees and returned
commissions) resulting from any claim for Real Estate Compensation by any person
or entity based upon such acts.
(b) Seller shall be responsible for paying the Approved Broker, at
and conditioned upon close of escrow, a sum equal to one percent (1%) of the
Purchase Price pursuant to a separate agreement between Seller and the Approved
Broker. Buyer shall be responsible for paying the Approved Broker, at and
conditioned upon close of escrow, an additional sum equal to one percent (1%) of
the Purchase Price.
10. General Provisions.
10.1 Notices. Any notice required or permitted to be given under
this Agreement shall be in writing and (i) personally delivered, (ii) sent by
United States mail, registered or certified mail, postage prepaid, return
receipt requested, (iii) sent by Federal Express or similar nationally
recognized overnight courier service, or (iv) transmitted by facsimile with a
hard copy sent within one (1) business day by any of the foregoing means, and in
all cases addressed as follows, and such notice shall be deemed to have been
given upon the date of actual receipt or delivery (or refusal to accept
delivery) at the address specified below (or such other addresses as may be
specified by notice in the foregoing manner) as indicated on the return receipt
or air bill:
TO SELLER: PMC-Sierra, Inc.
8555 Baxter Place
Burnaby, British Columbia V5A 4V7
Canada
Attn: Manager, Corporate Real Estate
and Facilities
Fax No. 604/415-6161
Phone No. 604/415-6651
with a copy to: Wilson Sonsini Goodrich & Rosati
650 Page Mill Road
Palo Alto, California 94304
Attention: Norman Cruz
Fax No. (650) 493-6811
Phone No. (650) 320-4926
TO BUYER: Westbrook Partners, L.L.C
100 California Street, Suite 750
San Francisco, CA 94111
Attn: Aric M. Shalev
Fax No. (415) 438-7921
Phone No. (415) 438-7920
with a copy to:
Westbrook Partners, L.L.C.
13155 Noel Road/LB 54
Suite 2400
Dallas, Texas 75240
Attn: Patrick K. Fox, Esq.
Facsimile (972) 934-8333
and
Gibson, Dunn & Crutcher LLP
333 S. Grand Avenue
Suite 4900
Los Angeles, CA 90071
Attn: Jesse Sharf, Esq.
Facsimile: (213) 229-6638
TO WHTS: Tishman Speyer Properties, L.P.
525 Market Street, Suite 3720
San Francisco, California 94105
Attention: Carl Shannon
Fax: (415) 536-4139
with a copy to:
Tishman Speyer Properties
520 Madison Avenue
New York, New York 10022
Attention: General Counsel
Fax: (212) 935-8239
and
Schulte Roth & Zabel LLP
919 Third Avenue
New York, New York 10022
Attention: Jeffrey A. Lenobel, Esq.
Fax: (212) 593-5955
and
Whitehall Street Real Estate
Limited Partnership IX
85 Broad Street
New York, New York 10004
Attention: Patricia Geery
Fax: (212) 357-5505
With a copy to:
Mr. Todd Williams Goldman,
Sachs & Co. 100 Crescent
Court, Suite 1000 Dallas,
TX 75201 Fax: (214)
855-6305
Stone Street Real Estate Fund 1998, L.P.
85 Broad Street
New York, New York 10004
Fax: (212) 357-5505
Bridge Street Real Estate Fund 1998, L.P.
85 Broad Street
New York, New York 10004
Fax: (212) 357-5505
Stone Street WHTS Corp.
85 Broad Street
New York, New York 10004
Fax: (212) 357-5505
10.2 Entire Agreement; No Modifications. This Agreement, together
with the schedules and exhibits attached hereto, incorporates all agreements,
warranties, representations and understandings between the parties to the
Agreement with respect to the subject matter hereof and constitutes the entire
agreement of Seller and Buyer with respect to the purchase and sale of the
Property. Any prior or contemporaneous correspondence, memoranda,
understandings, offers, negotiations and agreements, oral or written, are merged
herein and replaced in total by this Agreement and the exhibits hereto and shall
be of no further force or effect. This Agreement may not be modified or amended
except in a writing signed by Seller and Buyer.
10.3 Time. Time is of the essence in the performance of the
parties' respective obligations set forth in this Agreement.
10.4 Attorneys' Fees. In the event any action or proceeding at law
or in equity between Buyer and Seller (including an action or proceeding between
Buyer and the trustee or debtor in possession while Seller is a debtor in a
proceeding under the Bankruptcy Code (Title 11 of the United States Code) or any
successor statute to such Code) to enforce or interpret any provision of this
Agreement or to protect or establish any right or remedy of either Buyer or
Seller hereunder, the unsuccessful party to such action or proceeding shall pay
to the prevailing party all costs and expenses including, without limitation,
reasonable attorneys' and paralegals' fees and expenses, incurred by such
prevailing party, in such action or proceeding and in any appeal in connection
therewith, whether or not such action, proceeding or appeal is prosecuted to
judgment or other final determination, together with all costs of enforcement
and/or collection of any judgment or other relief.
10.5 Specific Performance. The parties understand and agree that
the Property is unique and for that reason, among others, Buyer will be
irreparably damaged in the event that this Agreement is not specifically
enforced. Accordingly, in the event that Seller defaults in its obligation to
sell the Property to Buyer after (i) Seller has acquired the fee title to the
Property from WHTS, (ii) all other conditions to the Seller's obligation to sell
the Property set forth in Section 4(c) shall have been satisfied, and (ii) the
Buyer shall have performed, tendered (or offered to tender) performance of its
obligations under this Agreement, Buyer shall have, in addition to a claim for
damages for such breach or default (subject, however, to the limitations set
forth in Section 5.1), and in addition and without prejudice to any right or
remedy available at law or in equity, the right to demand and have specific
performance of this Agreement. In all other circumstances, Buyer hereby waives
the right to specific performance of this Agreement.
10.6 Successors And Assigns. Except as permitted by this Section,
this Agreement may not be assigned by Seller or Buyer without the prior written
consent of the other party which may be granted or withheld by the other party
in its sole discretion. Subject to the foregoing provision, this Agreement shall
inure to the benefit of and be binding upon the parties to this Agreement and
their respective successors and assigns. Seller shall have the right to assign
its rights and obligations under this Agreement to an affiliate of Seller by
delivery of notice of the identity of the assignee affiliate at least 15 days
prior to the Scheduled Closing Date, provided that the assignee assumes for
Buyer's benefit all of Seller's obligations hereunder and, notwithstanding such
assignment, Seller shall not be released from its obligations under the
Agreement or the Seller Closing Certificate; and Buyer shall have the right to
assign its rights and obligations under this Agreement to an affiliate of Buyer,
provided that the assignee assumes for Seller's and WHTS' benefit all of Buyer's
obligations hereunder and, notwithstanding such assignment, Buyer shall not be
released from any obligations it may have under the Agreement or the Closing
Documents. For the purposes of this Section, "affiliate of Buyer" shall mean an
entity controlling, controlled by or under common control with Buyer. "Control"
shall mean the possession, directly or indirectly, of the power to direct the
management and policies of an entity, whether through the ownership of voting
securities, by contract or otherwise.
10.7 Counterparts. This Agreement may be executed in one or more
counterparts and each such counterpart shall be deemed to be an original; all
counterparts so executed shall constitute one instrument and shall be binding on
all of the parties to this Agreement notwithstanding that all of the parties are
not signatories to the same counterpart.
10.8 Construction. This Agreement shall be governed by and
construed under the laws of the State of California. The parties acknowledge
that each party and its counsel have reviewed and revised this Agreement and
that no rule of construction to the effect that any ambiguities are to be
resolved against the drafting party shall be employed in the interpretation of
this Agreement or any schedules or exhibits to it or any document executed and
delivered by either party in connection with this Agreement. All captions in
this Agreement are for reference only and shall not be used in the
interpretation of this Agreement or any related document. If any provision of
this Agreement shall be determined to be illegal or unenforceable, such
determination shall not affect any other provision of this Agreement and all
such other provisions shall remain in full force and effect.
10.9 Confidentiality. Seller shall keep all information obtained
from or about Buyer or the transaction contemplated by this Agreement strictly
confidential and will not disclose any such information to any other person or
entity without first obtaining the prior written consent of Buyer.
Notwithstanding anything to the contrary contained in this Agreement, Buyer and
Buyer's Agents and Seller and Seller's Agents may disclose the tax treatment
(i.e., the purported or claimed Federal income tax treatment) or the tax
structure (i.e., any fact that may be relevant to understanding such treatment)
of the transaction contemplated by this Agreement, and all materials of any kind
(including opinions or other tax analyses) provided by Seller to Buyer relating
to such tax treatment and tax structure.
10.10 No Third Party Beneficiaries. There are no third party
beneficiaries of this Agreement and no person or entity, other than Buyer and
Seller, shall be benefited by or have the right to enforce this Agreement.
10.11 Exculpation. Buyer agrees that it does not have and will not
have any claims or causes of action against any disclosed or undisclosed
officer, director, employee, trustee, shareholder, partner, member, principal,
parent, subsidiary or other affiliate of Seller (herein "Seller's Affiliates")
or against any disclosed or undisclosed officer, director, employee, trustee,
shareholder, partner, member, principal, parent, subsidiary or other affiliate
of WHTS, including, without limitation, Tishman Speyer Properties, L.P. and
Goldman, Sachs & Co., or any officer, director, employee, trustee, shareholder,
member, partner or principal of any such parent, subsidiary or other affiliate
(collectively, "WHTS' Affiliates"), arising out of with this Agreement, the
Closing Certificates, or the transactions contemplated hereby. Buyer agrees to
look solely to Seller and its assets and to WHTS and its assets for the
satisfaction of any liability or obligation arising under this Agreement, the
Closing Documents, or the transactions contemplated hereby, or for the
performance of any of the covenants, warranties or other agreements contained
herein or in the Closing Documents, and further agrees not to sue or otherwise
seek to enforce any personal obligation against any of Seller's Affiliates or
WHTS' Affiliates with respect to any matters arising out of this Agreement, the
Closing Documents, or the transactions contemplated hereby. The provisions of
this Section 10.11, however, shall not apply to Seller's Affiliates to the
extent of the amount a Seller's Affiliate has received after the date of this
Agreement, if the remaining funds available to Seller to satisfy the obligations
of Seller to Buyer pursuant to this Agreement and the Closing Documents are not
at least equal to Five Million Dollars ($5,000,000) or such lower amount of
liability or potential liability as Seller may have under such agreements. In
addition, the provisions of this Section 10.11 shall not apply to Tishman
Speyer/Travelers Real Estate Venture, L.P. and Whitehall Street Real Estate
Limited Partnership IX (collectively, the "Members") to the extent of the amount
any of the Members has received from the proceeds of the transactions which is
the subject of the WHTS Agreement, if the remaining funds available to WHTS to
satisfy the obligations of WHTS to Buyer pursuant to this Agreement, the Closing
Documents and the WHTS Agreement are not at least equal to Five Million Dollars
($5,000,000) or such lower amount of liability or potential liability as WHTS
may have under such agreements. The provisions of this Section 10.11 shall
survive the termination of this Agreement and the Closing Date. This Section
10.11 will not apply to the parties to the Parking Easement or the Development
Indemnity Agreement to the extent such claim or cause of action relates solely
to the Parking Easement Agreement or the Development Indemnity Agreement, as
applicable.
IN WITNESS WHEREOF, Buyer and Seller have executed this Agreement as of
the date and year first written above:
SELLER: BUYER:
PMC-Sierra, Inc., WB MISSION TOWERS, LLC,
a Delaware corporation a Delaware limited liability company
By:____________________________ By:____________________________
Name:__________________________ Name:__________________________
Title:_________________________ Title:_________________________