PURCHASE AND SALE AGREEMENT
THIS AGREEMENT is made as of the ____ day of August, 1998, between PP
CENTER LIMITED, an Ohio limited liability company ("Seller"), and RRC
ACQUISITIONS TWO, INC., a Florida corporation, its designees, successors and
assigns ("Buyer").
Background
Buyer wishes to purchase a shopping center in the City of Columbus,
State of Ohio, owned by Seller, known as Park Place Shopping Center (the
"Shopping Center");
Seller wishes to sell the Shopping Center to Buyer;
In consideration of the mutual agreements herein, and other good and
valuable consideration, the receipt of which is hereby acknowledged, Seller
agrees to sell and Buyer agrees to purchase the Property (as hereinafter
defined) on the following terms and conditions:
1. DEFINITIONS
As used in this Agreement, the following terms shall have the following
meanings:
1.1 Agreement means this instrument as it may be amended from time to
time.
1.2 Allocation Date means the close of business on the day immediately
prior to the Closing Date.
1.3 Audit Representation Letter means the form of Audit Representation
Letter attached hereto as Exhibit .
1.4 Buyer means the party identified as Buyer on the initial page
hereof.
1.5 Closing means generally the execution and delivery of those
documents and funds necessary to effect the sale of the
Property by Seller to Buyer.
1.6 Closing Date means the date on which the Closing occurs.
1.7 Contracts means all service contracts, agreements or other
instruments to be assigned by Seller to Buyer at Closing.
1.8 Day means a calendar day, whether or not the term is capitalized.
1.9 Earnest Money Deposit means the deposit delivered by Buyer to
Escrow Agent prior to the Closing under Sections and of this Agreement, together
with the earnings thereon, if any.
1.10 Effective Date means the date which is the later of the date of
execution by the last of Buyer or Seller to execute this Agreement and transmit
a copy of the fully executed Agreement to the other, or (b) receipt by the Buyer
of documents asterisked in Exhibit .
1.11 Environmental Claim means any investigation, notice, violation,
demand, allegation, action, suit, injunction, judgment, order, consent decree,
penalty, fine, lien, proceeding, or claim (whether administrative, judicial, or
private in nature) arising (a) pursuant to, or in connection with, an actual or
alleged violation of, any Environmental Law, (b) in connection with any
Hazardous Material or actual or alleged Hazardous Material Activity, (c) from
any abatement, removal, remedial, corrective, or other response action in
connection with a Hazardous Material, Environmental Law or other order of a
governmental authority or (d) from any actual or alleged damage, injury, threat,
or harm to health, safety, natural resources, or the environment.
1.12 Environmental Law means any current legal requirement in effect at
the Closing Date pertaining to (a) the protection of health, safety, and the
indoor or outdoor environment, (b) the conservation, management, protection or
use of natural resources and wildlife, (c) the protection or use of source water
and groundwater, (d) the management, manufacture, possession, presence, use,
generation, transportation, treatment, storage, disposal, Release, threatened
Release, abatement, removal, remediation or handling of, or exposure to, any
Hazardous Material or (e) pollution (including any Release to air, land, surface
water, and groundwater); and includes, without limitation, the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended by
the Superfund Amendments and Reauthorization Act of 1986, 42 USC ss.ss.9601 et
seq., Solid Waste Disposal Act, as amended by the Resource Conservation Act of
1976 and Hazardous and Solid Waste Amendments of 1984, 42 USC ss.ss.6901 et
seq., Federal Water Pollution Control Act, as amended by the Clean Water Act of
1977, 33 USC ss.ss.1251 et seq., Clean Air Act of 1966, as amended, 42 USC
ss.ss.7401 et seq., Toxic Substances Control Act of 1976, 15 USC ss.ss.2601 et
seq., Hazardous Materials Transportation Act, 49 USC App. ss.ss.1801,
Occupational Safety and Health Act of 1970, as amended, 29 USC ss.ss.651 et
seq., Oil Pollution Act of 1990, 33 USC ss.ss.2701 et seq., Emergency Planning
and Community Right-to-Know Act of 1986, 42 USC App. ss.ss.11001 et seq.,
National Environmental Policy Act of 1969, 42 USC ss.ss.4321 et seq., Safe
Drinking Water Act of 1974, as amended by 42 USC ss.ss.300(f) et seq., and any
similar, implementing or successor law, any amendment, rule, regulation, order
or directive, issued thereunder.
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1.13 Escrow Agent means Ohio Title Corporation, as agent for First
American Title Insurance Company, 115 W. Main Street, Columbus, Ohio 43215;
Telephone 614/221-7701; Facsimile 614/221-8954, or any successor Escrow Agent.
1.14 Governmental Approval means any permit, license, variance,
certificate, consent, letter, clearance, closure, exemption, decision, action or
approval of a governmental authority.
1.15 Hazardous Material means any asbestos, petroleum, petroleum
product, drycleaning solvent or chemical, biological or medical waste, "sharps"
or any other hazardous or toxic substance as defined in or regulated by any
Environmental Law in effect at the pertinent date or dates.
1.16 Hazardous Material Activity means any activity, event, or
occurrence at or prior to the Closing Date involving a Hazardous Material,
including, without limitation, the manufacture, possession, presence, use,
generation, transportation, treatment, storage, disposal, Release, threatened
Release, abatement, removal, remediation, handling or corrective or response
action to any Hazardous Material.
1.17 Improvements means all buildings, structures or other improvements
situated on the Real Property.
1.18 Inspection Period means the period of time which expires at
midnight on the fortieth (40th) day after the later of the (a) date of execution
by the last of Buyer or Seller to execute this Agreement and transmit a copy of
the fully executed Agreement to the other, or (b) receipt by the Buyer of
documents asterisked in Exhibit . If such expiration date is a weekend or
national holiday, the Inspection Period shall expire at midnight on the next
immediately succeeding business day.
1.19 Leases means all leases and other occupancy agreements permitting
persons to lease or occupy all or a portion of the Property.
1.20 Materials means all plans, drawings, specifications, soil test
reports, environmental reports, market studies, surveys, and similar
documentation, if any, owned by or in the possession of Seller with respect to
the Property, Improvements and any proposed improvements to the Property, which
Seller may lawfully transfer to Buyer except proprietary, confidential
Materials, and except that, as to financial and other records, Materials shall
include only photostatic copies.
1.21 Partnership means Regency Centers, L.P., a Delaware limited
partnership, of which Regency is the sole general partner.
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1.22 Partnership Agreement means the Amended and Restated Partnership
Agreement of the Partnership, a copy of which is attached hereto as Exhibit
1.23 Partnership Units means units representing limited partnership
interests in the Partnership.
1.24 Permitted Exceptions means only the following interests, liens and
encumbrances:
(a) Liens for ad valorem taxes not payable on or before Closing;
(b) The Surviving Mortgage and related loan documents;
(c) Rights of tenants under Leases;
(d) Zoning ordinances; and
(e) Other matters determined by Buyer to be acceptable.
1.25 Personal Property means all (a) sprinkler, plumbing, heating,
air-conditioning, electric power or lighting, incinerating, ventilating and
cooling systems, with each of their respective appurtenant furnaces, boilers,
engines, motors, dynamos, radiators, pipes, wiring and other apparatus,
equipment and fixtures, elevators, partitions, fire prevention and extinguishing
systems located in or on the Improvements, (b) all Materials, and (c) all other
personal property used in connection with the Improvements, provided the same
are now owned or are acquired by Seller prior to the Closing.
1.26 Property means collectively the Real Property, the Improvements
and the Personal Property.
1.27 Prorated means the allocation of items of expense or income
between Buyer and Seller based upon that percentage of the time period as to
which such item of expense or income relates which has expired as of the date at
which the proration is to be made.
1.28 Purchase Price means the consideration agreed to be paid by Buyer
to Seller for the purchase of the Property as set forth in Section (subject to
adjustments as provided herein).
1.29 Real Property means the lands more particularly described on
Exhibit , together with all easements, licenses, privileges, rights of way and
other appurtenances pertaining to or accruing to the benefit of such lands.
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1.30 Redemption Agreement means the form of Redemption Agreement
attached hereto as Exhibit .
1.31 Regency means Regency Realty Corporation, a Florida corporation.
1.32 Release means any spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, dumping, or disposing into
the indoor or outdoor environment, including, without limitation, the
abandonment or discarding of barrels, drums, containers, tanks, and other
receptacles containing or previously containing any Hazardous Material at or
prior to the Closing Date.
1.33 Rent Roll means the list of Leases attached hereto as Exhibit,
identifying with particularity the space leased by each tenant, the term
(including extension options), square footage and applicable rent,common area
maintenance, tax and other reimbursements, security deposits and similar data.
1.34 Seller means the party identified as Seller on the initial page
hereof.
1.35 Seller Financial Statements means the unaudited balance sheets and
statements of income, cash flows and changes in financial positions prepared by
Seller for the Property, as of and for the two (2) calendar years next preceding
the date of this Agreement and all monthly reports of income, expense and cash
flow prepared by Seller for the Property, which shall be consistent with past
practice, for any period beginning after the latest of such calendar years, and
ending prior to Closing.
1.36 Shopping Center means the Shopping Center identified on the
initial page hereof.
1.37 Survey means a map of a stake survey of the Real Property which
shall comply with Minimum Standard Detail Requirements for ALTA/ACSM Land Title
Surveys, jointly established and adopted by ALTA and ACSM in 1992, and includes
items 1, 2, 3, 4, 6, 7, 8, 9, 10 and 11 of Table "A" thereof, which meets the
accuracy standards (as adopted by ALTA and ACSM and in effect on the date of the
Survey) of an urban survey, which is dated not earlier than thirty (30) days
prior to the Closing, and which is certified to Buyer, Seller, the Title
Insurance company providing Title Insurance to Buyer and the holder of the
Surviving Mortgage.
1.38 Surviving Mortgage. means a mortgage or other instrument dated
September 26, 1995, from Seller to USG Annuity and Life Company with a principal
balance of $7,570,482.74 as of July 1, 1998, bearing interest at eight percent
(8.0%) per annum, amortizing over a twenty-five (25) year period, and maturing
on October 1, 2002.
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1.39 Tenant Estoppel Letter means a letter or other certificate from a
tenant certifying as to certain matters regarding such tenant's Lease, in
substantially the same form as attached hereto as Exhibit , or in the case of
national or regional "credit" tenants identified as such on the Rent Roll, the
form customarily used by such tenant provided the information disclosed is
acceptable to Buyer.
1.40 Title Defect means any exception in the Title Insurance Commitment
or any matter disclosed by the Survey, other than a Permitted Exception.
1.41 Title Insurance means an ALTA Form B Owners Policy of Title
Insurance for the full Purchase Price insuring marketable title in Buyer in fee
simple, subject only to the Permitted Exceptions, issued by a title insurer
acceptable to Buyer.
1.42 Title Insurance Commitment means a binder whereby the title
insurer agrees to issue the Title Insurance to Buyer.
1.43 Transaction Documents means this Agreement, the deed conveying the
Property, the assignment of leases, the bill of sale conveying the Personal
Property and all other documents required or appropriate in connection with the
transactions contemplated hereby.
2. PURCHASE PRICE AND PAYMENT
2.1 Purchase Price; Payment.
(a) Purchase Price and Terms. The total Purchase Price for the
Property (subject to adjustment as provided herein) shall be $10,750,000, less
the outstanding principal balance of the Surviving Mortgage as of the Allocation
Date. The Purchase Price shall be payable in cash at Closing, or alternatively
as provided in Section below, Seller may elect to contribute the Property to the
Partnership in exchange for Partnership Units therein.
(b) Adjustments to the Purchase Price. The Purchase Price
shall be adjusted as of the Closing Date by:
(1) prorating the Closing year's real and tangible personal
property taxes as of the Allocation Date (if the amount of the current year's
property taxes are not available, such taxes will be prorated based upon the
prior year's assessment);
(2) prorating as of the Allocation Date cash receipts and expenditures for
the Shopping Center, interest on the debt secured by the Surviving Mortgage
and other items customarily prorated in transactions of this sort; and
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(3) subtracting the amount of tenant security deposits held by Seller the
obligations for which are to be assumed by Buyer, prepaid rents from tenants
under the Leases, and credit balances, if any, of any tenants. Any rents,
percentage rents or tenant reimbursements payable by tenants after the
Allocation Date but applicable to periods on or prior to the Allocation Date
shall be remitted to Seller by Buyer within thirty (30) days after receipt, less
any reasonable expenses of the Property actually incurred on or prior to the
Allocation Date but discovered by Buyer after Closing. Buyer shall have no
obligation to collect delinquencies, but should Buyer collect any delinquent
rents or other sums which cover periods prior to the Allocation Date and for
which Seller have received no proration or credit, Buyer shall remit same to
Seller within thirty (30) days after receipt, less any reasonable costs of
collection. Buyer will not interfere in Seller's efforts to collect sums due it
prior to the Closing. Seller will remit to Buyer promptly after receipt any
rents, percentage rents or tenant reimbursements received by Seller after
Closing which are attributable to periods occurring after the Allocation Date.
Undesignated receipts after Closing of either Buyer or Seller from tenants in
the Shopping Center shall be applied first to then current rents and
reimbursements for such tenant(s), then to delinquent rents and reimbursements
attributable to post-Allocation Date periods, and then to pre-Allocation Date
periods. Utility deposits and similar deposits made by Seller shall be
transferred to Buyer, who shall reimburse Seller therefor, or Buyer shall make
its own deposits and Seller shall obtain refunds of the deposits made by Seller,
as Buyer and Seller shall agree prior to Closing.
2.2 Earnest Money Deposit. An Earnest Money Deposit in the amount of
$25,000 shall be delivered to Escrow Agent within three (3) days after the date
of execution by the last of Buyer or Seller to execute and transmit a copy of
this Agreement to the other. This Agreement may be terminated by Seller if the
Earnest Money Deposit is not received by Escrow Agent by such deadline. The
Earnest Money Deposit paid by Buyer shall be deposited by Escrow Agent in an
interest bearing account at First Union National Bank, and shall be held and
disbursed by Escrow Agent as specifically provided in this Agreement. The
Earnest Money Deposit shall be applied to the Purchase Price at the Closing.
2.3 Closing Costs.
(a) Seller shall pay:
(1) Transfer taxes imposed upon the transactions contemplated
hereby;
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(2) Cost of satisfying any liens on the Property other than
the Surviving Mortgage;
(3) Cost of title insurance and the costs, if any, of curing
title defects and recording any curative title documents;
(4) Transfer fees, assumption charges and other costs and fees
charged by the holder of the Surviving Mortgage, if any;
(5) Seller's attorneys' fees relating to the sale of the
Property.
(b) Buyer shall pay:
(1) Cost of Buyer's due diligence inspection;
(2) Costs of the Phase 1 environmental site assessment to be
obtained by Buyer;
(3) Cost of the Survey;
(4) Brokerage commission to R.A. Kennedy and Associates/Mark
Kennedy in the amount of $50,000.00, if and when the
transaction closes; and
(5) Cost of recording the deed; and
(6) Buyer's attorneys' fees.
2.4 Contribution Alternative. As an alternative to selling the Property
to Buyer, and if Buyer does not elect to terminate during the Inspection Period,
Seller, by notice to Buyer given within ten (10) business days after the end of
the Inspection Period, may elect to contribute the Property to the Partnership
in exchange for Partnership Units, as hereinafter provided. In such event the
Purchase Price for the Property shall be payable by exchanging for the Property,
Partnership Units in the Partnership having an aggregate value equal to the
Purchase Price, adjusted by the allocations, credits, charges and adjustments
provided in this Agreement, in which event there shall be no credit against the
Purchase Price for the Earnest Money Deposit, which shall be returned to Buyer
at Closing. The number of Partnership Units to be issued to Seller shall be
established by dividing such adjusted Purchase Price by the average closing
price of a share of the common stock of Regency over the twenty trading days
immediately preceding the fifth (5th) trading day prior to the Closing Date on
the New York Stock Exchange (or the exchange or quotation system on which the
common stock of Regency is then listed for trading). Under the terms of the
Redemption Agreement Seller, as a limited partner of the Partnership, shall have
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the right to require Regency to acquire all of its Partnership Units in the
Partnership (i) in exchange for common stock of Regency on the basis of one
Regency share for each Partnership Unit exchanged (the "Put Price"),
provided that such shares shall have such restrictions as are agreed upon in
the Partnership Agreement and in the Redemption Agreement, and further
provided such rights shall not be exercised in a manner or at any time
which would be or cause a violation of any law or regulation governing the sale
or disposition of securities, including without limitation Rule 144 or (ii)
in exchange for cash, as provided in the Redemption Agreement. If such exercise
results in a fractional share, Regency shall pay cash in lieu thereof in an
amount equal to such fraction multiplied by the average closing price of a
Regency share during the twenty (20) business days preceding the date of
Seller's notice. Regency or Seller may elect to pay or receive the Put Price
in cash instead of shares with respect to all or any portion of the Partner-
ship Units to be exchanged. The Redemption Agreement shall also provide that:
(a) Partnership and Seller agree that for federal income tax
purposes, they will report the transfer of the Property to the Partnership as a
contribution to the Partnership pursuant to Section 721 of the Internal Revenue
Code of 1986 (the "Code") for consideration consisting solely of Partnership
Units;
(b) For purposes of Section 704(c) of the Internal Revenue
Code of 1986, as amended (the "Code"), the Partnership will use the "traditional
method" described in Treasury Regulation Section 1.704-3(b) with respect to the
Property or any interest therein;
(c) So long as the Partnership Units held by the original
limited partners executing the Redemption Agreement (the "L.P.'s"), which L.P.'s
are intended to be Tod J. Ortlip and Jay Ortlip, constitute no less than fifty
percent (50%) in the aggregate of the Partnership Units originally issued to
such L.P.'s, until the maturity date of the Surviving Mortgage, the Partnership
will not take any action which will cause a reduction in the amount of
Partnership liabilities allocable to the L.P.'s pursuant to Treas. Reg. ss.
1.752-3(a)(2), except for scheduled payments of debt service; and
(d) So long as the Partnership Units held by the L.P.'s
constitute no less than fifty percent (50%) in the aggregate of the Partnership
Units originally issued to such L.P.'s, until the fifth anniversary of the
Closing, the Partnership shall not voluntarily dispose of the Property except in
a Section 1031 transaction under the Internal Revenue Code (or in a similar
transaction that would not be taxable to such L.P.'s for federal income tax
purposes).
(e) So long as the Partnership Units held by the L.P.'s
constitute no less than fifty percent (50%) in the aggregate of the Partnership
Units originally issued
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to such L.P.'s, from and after the maturity date of the Surviving Mortgage (or
at any earlier time with the consent of the general partner, which consent shall
not be unreasonably withheld), the general partner, if requested by one of the
L.P.'s shall cooperate with the L.P.'s to allow the L.P.'s to timely incur the
"economic risk of loss" for purposes of Section 752 of the Code (the
"guarantee") with respect to the bottom portion of any indebtedness of the
Partnership (such indebtedness to be reasonably selected by the general
partner), provided that the bottom portion guaranteed does not constitute more
than thirty-five percent (35%) of the then outstanding principal balance of the
indebtedness. Such guarantee shall be limited to a maximum aggregate balance of
$_______________ (the "Amount") at any one time. The guarantee shall be joint
and several as to the L.P.'s electing to execute the guarantee and in the
absence of any agreement among the L.P.'s to the contrary, the portion of the
indebtedness to be guaranteed shall be allocated among the L.P.'s electing to
execute the guarantee in proportion to the number of Partnership Units held by
each. An election to execute the guarantee of any indebtedness of the
Partnership shall be made by delivery of a written election notice to the
general partner, which indicates that a majority of the L.P.'s then holding
Partnership Units have elected to guarantee Partnership indebtedness pursuant to
this Section 2.4(d), the amount of the indebtedness (up to the limit set forth
above) and the allocation of responsibility of such guarantee among the L.P.'s
making the election. The election may be made only once. In satisfying its
obligations hereunder, the general partner of the Partnership shall reasonably
endeavor to identify an amount of indebtedness such that the guarantee can be
made in an amount approximately equal to the Amount, to cooperate with the
L.P.'s to structure any guarantee in a manner that the guarantee terminates at a
time determined by the L.P.'s and to provide indebtedness to be guaranteed that
the Partnership anticipates will be outstanding for no less than five (5) years
after the date of the guarantee. The general partner shall not be obligated to
incur any expenses with respect to the foregoing other than expenses for which
they will be reimbursed by the L.P.'s.
3. INSPECTION PERIOD AND CLOSING
3.1 Inspection Period.
(a) Buyer agrees that it will have the Inspection Period to
physically inspect the Property, review the economic data, underwrite the
tenants and review their Leases, and to otherwise conduct its due diligence
review of the Property and all books, records and accounts of Seller related
thereto. Buyer hereby agrees to indemnify and hold Seller harmless from any
damages, liabilities or claims for property damage or personal injury arising
out of such inspection and investigation by Buyer or its agents or independent
contractors; and Buyer agrees to repair and restore the Property to its
condition immediately prior to Buyer's entry thereon to the extent any damage to
the Property arose because of Buyer's entry thereon or the entry thereon
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of Buyer's agents, employees, contractors and consultants. Within the Inspection
Period, Buyer may, in its sole discretion and for any reason or no reason, elect
to go forward with this Agreement to Closing, which election shall be made by
notice to Seller given within the Inspection Period. If such notice is not
timely given, this Agreement and all rights, duties and obligations of Buyer and
Seller hereunder, except any which expressly survive termination, shall
terminate and Escrow Agent shall forthwith return to Buyer the Earnest Money
Deposit. If Buyer so elects to go forward, the Earnest Money Deposit shall be
increased by an additional deposit of $100,000 (to be deposited with Escrow
Agent no later than three (3) business days following the end of the Inspection
Period), and shall not be refundable except upon the terms otherwise set forth
herein.
(b) Seller will promptly furnish or make available to Buyer
the documents enumerated on Exhibit attached hereto, and Buyer agrees to keep
confidential any information derived from such documents, except as necessary to
share with its attorneys, consultants and lenders. Buyer further agrees to
return said documents to Seller should this transaction fail to close. Buyer,
through its officers, employees and other authorized representatives, shall have
the right to reasonable access to the Property and all records of Seller related
thereto, including without limitation all Leases and Seller Financial
Statements, at reasonable times during the Inspection Period for the purpose of
inspecting the Property, taking soil and ground water samples, conducting
Hazardous Materials inspections, reviewing the books and records of Seller
concerning the Property and otherwise conducting its due diligence review of the
Property. Seller shall cooperate with and assist Buyer in making such
inspections and reviews. Seller shall give Buyer any authorizations which may be
required by Buyer in order to gain access to records or other information
pertaining to the Property or the use thereof maintained by any governmental or
quasi-governmental authority or organization. Buyer, for itself and its agents,
agrees not to enter into any contract with existing tenants without the written
consent of Seller if such contract would be binding upon Seller should this
transaction fail to close. Buyer shall have the right to have due diligence
interviews and other discussions or negotiations with tenants.
(c) Buyer, through its officers or other authorized
representatives, shall have the right to reasonable access to all Materials
(other than privileged or confidential litigation materials) for the purpose of
reviewing and copying the same.
3.2 Hazardous Material. Prior to the end of the Inspection Period Buyer
may order environmental assessments of the Property. A copy of any assessment
report, if made, shall be furnished by Buyer to Seller promptly upon its
completion. If an assessment report discloses the existence of any Hazardous
Material or any other matters concerning the environmental condition of the
Property or its environs, Buyer may notify Seller in writing, within ten (10)
business days after receipt of the
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assessment report that it elects to terminate this Agreement, whereupon this
Agreement shall terminate and Escrow Agent shall return to Buyer its Earnest
Money Deposit.
3.3 Time and Place of Closing. Unless otherwise agreed by the parties,
the Closing shall take place at the offices of Escrow Agent at 10:00 A.M. on the
date which is the fifteenth (15th) business day following the expiration of the
Inspection Period, provided that Buyer may designate an earlier date for
Closing.
4. WARRANTIES, REPRESENTATIONS AND COVENANTS OF SELLER
Seller warrants and represents as follows as of the date of this
Agreement and as of the Closing and where indicated covenants and agrees as
follows:
4.1 Organization; Authority. Seller is duly organized, validly existing
and in good standing under the laws of the state of its organization and the
state in which the Shopping Center is located, and has full power and authority
to enter into and perform this Agreement in accordance with its terms, and the
persons executing this Agreement and other Transaction Documents have been duly
authorized to do so on behalf of Seller. Seller is not a "foreign person" under
Sections 1445 or 897 of the Internal Revenue Code nor is this transaction
subject to any withholding under any state or federal law.
4.2 Authorization; Validity. The execution and delivery of this
Agreement by Seller and Seller's consummation of the transactions contemplated
by this Agreement have been duly and validly authorized. This Agreement
constitutes a legal, valid and binding agreement of Seller enforceable against
it in accordance with its terms.
4.3 Title. Seller is the owner in fee simple of all of the Property,
subject only to the Permitted Exceptions.
4.4 Commissions. Seller has neither dealt with nor does it have any
knowledge of any broker or other party who has or may have any claim against
Seller, Buyer or the Property for a brokerage commission or finder's fee or like
payment arising out of or in connection with the transaction provided herein
except for R.G. Kennedy & Associates/Mark Heath (whose commission is payable by
Buyer). Seller agrees to indemnify Buyer from any other such claim arising by,
through or under Seller. The provisions of this section shall survive Closing
indefinitely.
4.5 Sale Agreements. The Property is not subject to any outstanding
agreement(s) of sale, option(s), or other right(s) of third parties to acquire
any interest therein, except for Permitted Exceptions and this Agreement.
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4.6 Litigation. There is no litigation or proceeding pending, or to the
best of Seller's knowledge, threatened against Seller relating to the Property.
4.7 Leases. There are no Leases affecting the Property, oral or
written, except as listed on the Rent Roll, and any Leases or modifications
entered into between the date of this Agreement and the Closing Date with the
reasonable consent of Buyer. Copies of the Leases, which have been delivered to
Buyer or shall be delivered to Buyer within five (5) days from the date hereof,
are, to the best knowledge of Seller, true, correct and complete copies thereof,
subject to the matters set forth on the Rent Roll. Between the date hereof and
the Closing Date, Seller will not terminate or modify existing Leases or enter
into any new Leases without the reasonable consent of Buyer. All of the
Property's tenant leases are in good standing and to the best of Seller's
knowledge no defaults exist thereunder except as noted on the Rent Roll. No rent
or reimbursement has been paid more than one (1) month in advance and no
security deposit has been paid, except as stated on the Rent Roll. No tenants
under the Leases are entitled to interest on any security deposits. No tenant
under any Lease has or will be promised any inducement, concession or
consideration by Seller other than as expressly stated in such Lease, and except
as stated therein there are and will be no side agreements between Seller and
any tenant.
4.8 Financial Statements. Each of the Seller Financial Statements
delivered or to be delivered to Buyer hereunder has or will have been prepared
in accordance with the books and records of Seller and presents fairly in all
material respects the financial condition, results of operations and cash flows
for the Property as of and for the periods to which they relate. All are in
conformity with Seller's customary income tax accounting standards applied by
Seller on a consistent basis. There has been no material adverse change in the
operations of the Property or its prospects since the date of the most recent
Seller Financial Statements. Seller covenants to furnish promptly to Buyer
copies of the Seller Financial Statements together with unaudited updated
monthly reports of cash flow for interim periods beginning after December 31,
1997. Buyer and its independent certified accountants shall be given access to
Seller's books and records at any time prior to and for six (6) months following
Closing upon reasonable advance notice in order that they may verify the
financial statements prior to Closing. Seller agrees to execute and deliver to
Buyer or its accountants the Audit Representation Letter should Buyer's
accountants audit the records of the Shopping Center.
4.9 Contracts. Except for Leases and Permitted Exceptions, there are no
management, service, maintenance, utility or other contracts or agreements
affecting the Property, oral or written, which extend beyond the Closing Date
and which would bind Buyer or encumber the Property, at Buyer's option, more
than thirty (30) days after Closing. All such Contracts are in full force and
effect in accordance with their respective terms, and all obligations of Seller
under the Contracts required to be
- - 13 -
performed to date have been performed in all material respects; no party to any
Contract has asserted any claim of default or offset against Seller with respect
thereto and no event has occurred or failed to occur, which would, to the best
of Seller's knowledge, in any way materially and adversely affect the validity
or enforceability of any such Contract; and the copies of the Contracts
delivered to Buyer prior to the date hereof are true, correct and complete
copies thereof. Between the date hereof and the Closing, Seller covenants to
fulfill all of its obligations under all Contracts, and covenants not to
terminate or modify any such Contracts or enter into any new contractual
obligations relating to the Property without the consent of Buyer (not to be
unreasonably withheld) except such obligations as are freely terminable without
penalty by Seller upon not more than thirty (30) days' written notice.
4.10 Maintenance and Operation of Property. From and after the date
hereof and until the Closing, Seller covenants to keep and maintain and operate
the Property substantially in the manner in which it is currently being
maintained and operated and covenants not to cause or permit any waste of the
Property nor undertake any action with respect to the operation thereof outside
the ordinary course of business without Buyer's prior written consent. In
connection therewith, Seller covenants to make all necessary repairs and
replacements until the Closing so that the Property shall be of substantially
the same quality and condition at the time of Closing as on the date hereof.
Seller covenants not to remove from the Improvements or the Real Property any
article included in the Personal Property. Seller covenants to maintain such
casualty and liability insurance on the Property as it is presently being
maintained.
4.11 Permits and Zoning. To the best knowledge of Seller, there are no
material permits and licenses (collectively referred to as "Permits") required
to be issued to Seller by any governmental body, agency or department having
jurisdiction over the Property which materially affect the ownership or the use
thereof which have not been issued. The Property is properly zoned for its
present use and is not subject to any local, regional or state development
order. The use of the Property is consistent with the land use designation for
the Property under the comprehensive plan or plans applicable thereto. There are
no outstanding assessments, impact fees or other charges related to the
Property.
4.12 Rent Roll; Tenant Estoppel Letters. The Rent Roll is true and
correct in all respects. Seller agrees to use commercially reasonable efforts to
obtain current Tenant Estoppel Letters acceptable to Buyer from all Tenants
under Leases, which Tenant Estoppel Letters shall confirm the matters reflected
by the Rent Roll as to the particular tenant and shall be otherwise acceptable
to Buyer in all respects.
4.13 Condemnation. Neither the whole nor any portion of the Property,
including access thereto or any easement benefitting the Property, is subject to
temporary requisition of use by any governmental authority or has been
condemned,
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or taken in any proceeding similar to a condemnation proceeding, nor is there
now pending any condemnation, expropriation, requisition or similar proceeding
against the Property or any portion thereof. Seller has received no notice nor
has any knowledge that any such proceeding is contemplated.
4.14 Governmental Matters. Seller has not entered into any commitments
or agreements with any governmental authorities or agencies affecting the
Property that have not been disclosed in writing to Buyer and Seller has
received no notices from any such governmental authorities or agencies of
uncured violations at the Property of building, fire, air pollution or zoning
codes, rules, ordinances or regulations, environmental and hazardous substances
laws, or other rules, ordinances or regulations relating to the Property. Seller
shall be responsible for the remittance of all sales tax for periods occurring
prior to the Allocation Date directly to the appropriate state department of
revenue.
4.15 Repairs. Seller has received no notice of any requirements or
recommendations by any lender, insurance companies, or governmental body or
agencies requiring or recommending any repairs or work to be done on the
Property which have not already been completed.
4.16 Consents and Approvals; No Violation. Neither the execution and
delivery of this Agreement by Seller nor the consummation by Seller of the
transactions contemplated hereby will (a) require Seller to file or register
with, notify, or obtain any permit, authorization, consent, or approval of, any
governmental or regulatory authority; (b) conflict with or breach any provision
of the organizational documents of Seller; (c) violate or breach any provision
of, or constitute a default (or an event which, with notice or lapse of time or
both, would constitute a default) under, any note, bond, mortgage, indenture,
deed of trust, license, franchise, permit, lease, contract, agreement or other
instrument, commitment or obligation to which Seller is a party, or by which
Seller, the Property or any of Seller's material assets may be bound, except the
Surviving Mortgage, the transactions contemplated hereby requiring the consent
of the holder of the Surviving Mortgage; or (d) violate any order, writ,
injunction, decree, judgment, statute, law or ruling of any court or
governmental authority applicable to Seller, the Property or any of Seller's
material assets.
4.17 Environmental Matters.
(a) Seller represents and warrants as of the date hereof and as of
the Closing that:
(1) Seller has not, and has no knowledge of any other person who
has, caused any Release, threatened Release, or disposal
of any Hazardous Material at the Property in any material
quantity.
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(2) The Property does not now contain and to the best of Seller's
knowledge has not contained any: (a) underground storage
tank, (b) material amounts of asbestos-containing building
material, (c) landfills or dumps, or (d) hazardous waste
management facility as defined pursuant to the Resource
Conservation and Recovery Act ("RCRA") or any comparable state
law. The Property is not a site on or nominated for
the National Priority List promulgated pursuant to
Comprehensive Environmental Response, Compensation and
Liability Act ("CERCLA") or any state remedial priority
list promulgated or published pursuant to any comparable
state law. Seller discloses and Buyer acknowledges that a
drycleaning facility is presently being operated on the
Property.
(3) There are to the best of Seller's knowledge no conditions or
circumstances at the Property which pose a risk to the
environment or the health or safety of persons in violation of
Environmental Law.
(b) Seller shall indemnify, hold harmless, and hereby waives any
claim for contribution against Buyer for any damages to the
extent they arise from the inaccuracy or breach of any repre-
sentation or warranty by Seller in this section of this Agreement.
This indemnity shall survive Closing for a period of two (2)
years and shall be in addition to the post-closing indemnities
contained in Section .
4.18 Surviving Mortgage. To Seller's knowledge, the Surviving Mortgage
is presently held by USG Annuity and Life Company and is in good standing with
no defaults existing thereunder. The principal balance outstanding as of July 1,
1998, is $7,570,482.74, and the monthly payment of principal and interest is
$60,780.53. The interest rate is eight percent (8.0%) per annum. Seller has
deposits with the holder of the Surviving Mortgage totalling $14,036.11 for
taxes. Such deposits will be assigned at Closing, Buyer to reimburse Seller
therefor. The transfer of the Property to Buyer will require the consent of the
holder of the Surviving Mortgage. Prior to the end of the Inspection Period,
Seller shall use reasonable efforts to cause the holder of the Surviving
Mortgage to execute and deliver to Buyer an estoppel letter and consent
consenting to this transaction and certifying as to the foregoing matters in
form and substance reasonably satisfactory to Buyer. Seller will maintain the
Surviving Mortgage in good standing, without default, until Closing.
4.19 No Untrue Statement. Neither this Agreement nor any exhibit nor
any written statement or Transaction Document furnished or to be furnished by
Seller to Buyer in connection with the transactions contemplated by this
Agreement contains or will contain any untrue statement of material fact or
omits or will omit any material fact necessary to make the statements contained
therein, in light of the circumstances under which they were made, not
misleading.
- - 16 -
5. WARRANTIES, REPRESENTATIONS AND COVENANTS OF BUYER
Buyer hereby warrants and represents as of the date of this Agreement
and as of the Closing and where indicated covenants and agrees as follows:
5.1 Organization; Authority. Buyer is a corporation duly organized,
validly existing and in good standing under laws of Florida and has full power
and authority to enter into and perform this Agreement in accordance with its
terms, and the persons executing this Agreement and other Transaction Documents
on behalf of Buyer have been duly authorized to do so.
5.2 Authorization; Validity. The execution, delivery and performance of
this Agreement and the other Transaction Documents have been duly and validly
authorized by the Board of Directors of Buyer. This Agreement has been duly and
validly executed and delivered by Buyer and (assuming the valid execution and
delivery of this Agreement by Seller) constitutes a legal, valid and binding
agreement of Buyer enforceable against it in accordance with its terms.
5.3 Partnership and Regency Organization. Partnership is a Delaware
limited partnership, the sole general partner of which is Regency. Partnership
is or at Closing will be qualified to transact business in the state in which
the Property is located. Buyer is a wholly owned subsidiary of Regency, whose
common shares are traded on the New York Stock Exchange. The authorized capital
stock of Regency consists of (i) 150,000,000 shares of Common Stock, (ii)
10,000,000 shares of special Common Stock, $0.01 par value, and (iii) 10,000,000
shares of preferred stock, $0.01 par value. As of March 31, 1998, there were
24,865,205 shares of Common Stock issued and outstanding, and 2,500,000 shares
of Special Common Stock in the form of Class B Non-voting Common Stock, par
value $0.01 issued and outstanding. The Class B Common Stock is held by a single
investor and is convertible in stages beginning in December, 1998, into a total
of 2,975,468 shares of Common Stock.
5.4 Commissions. Buyer has neither dealt with nor does it have any
knowledge of any broker or other party who has or may have any claim against
Buyer or Seller for a brokerage commission or finder's fee or like payment
arising out of or in connection with the transaction provided herein except R.G.
Kennedy & Associates/Mark Heath, whose commission shall be paid by Buyer. Buyer
agrees to indemnify Seller from any other such claim arising by, through or
under Buyer. The provisions of this section shall survive Closing indefinitely.
- - 17 -
6. POSSESSION; RISK OF LOSS
6.1 Possession. Possession of the Property will be transferred to Buyer
at the conclusion of the Closing.
6.2 Risk of Loss. All risk of loss to the Property shall remain upon
Seller until the conclusion of the Closing. If, before the possession of the
Property has been transferred to Buyer, any material portion of the Property is
damaged by fire or other casualty and will not be restored by the Closing Date
or if any material portion of the Property is taken by eminent domain or there
is a material obstruction of access to the Improvements by virtue of a taking by
eminent domain, Seller shall, within ten (10) days of such damage or taking,
notify Buyer thereof and Buyer shall have the option to:
(a) terminate this Agreement upon notice to Seller given
within ten (10) business days after such notice from Seller, in which case Buyer
shall receive a return of its Earnest Money Deposit; or
(b) proceed with the purchase of the Property, in which event
Seller shall assign to Buyer all Seller's right, title and interest in all
amounts due or collected by Seller under the insurance policies or as
condemnation awards. In such event, the Purchase Price shall be reduced by the
amount of any insurance deductible to the extent it reduced the insurance
proceeds payable.
7. TITLE MATTERS
7.1 Title.
(a) Title Insurance and Survey. Promptly after the full
execution hereof Buyer's counsel shall order the Title Insurance Commitment and
a Survey (Seller agreeing to furnish to Buyer copies of any existing surveys and
title information in its possession promptly after execution of this Agreement).
Buyer will have ten (10) days from receipt of the Title Commitment (including
legible copies of all recorded exceptions noted therein) and Survey within which
to notify Seller in writing of any Title Defects, encroachments or other matters
not acceptable to Buyer which are not permitted by this Agreement. Any Title
Defect or other objection disclosed by the Title Insurance Commitment (other
than liens removable by the payment of money, except the Surviving Mortgage) or
the Survey which is not timely specified in Buyer's written notice to Seller of
Title Defects shall be deemed a Permitted Exception. Seller shall notify Buyer
in writing within five (5) days of Buyer's notice if Seller intends to cure any
Title Defect or other objection. If Seller elects to cure, Seller shall use
diligent efforts to cure the Title Defects and/or objections by the Closing Date
(as it may be extended). If Seller elects not to cure or if such Title Defects
and/or objections are not cured,
- - 18 -
Buyer shall have the right, in lieu of any other remedies, to: (i) refuse to
purchase the Property, terminate this Agreement and receive a return of the
Earnest Money Deposit as its sole remedy; or (ii) waive such Title Defects
and/or objections and close the purchase of the Property subject to such Title
Defects.
(b) Miscellaneous Title Matters. If a search of the title
discloses judgments, bankruptcies or other returns against other persons having
names the same as or similar to that of Seller, Seller shall on request deliver
to Buyer an affidavit stating, if true, that such judgments, bankruptcies or the
returns are not against Seller. Seller further agrees to execute and deliver to
the Title Insurance agent at Closing such documentation, if any, as the Title
Insurance underwriter shall reasonably require to evidence that the execution
and delivery of this Agreement and the consummation of the transactions
contemplated hereby have been duly authorized and that there are no mechanics'
liens on the Property or parties in possession of the Property other than
tenants under Leases and Seller.
8. CONDITIONS PRECEDENT
8.1 Conditions Precedent to Buyer's Obligations. The obligations of
Buyer under this Agreement are subject to satisfaction or waiver by Buyer of
each of the following conditions or requirements on or before the Closing Date:
(a) Seller's warranties and representations under this
Agreement shall be true and correct in all material respects as of the Closing
Date, and Seller shall not be in default hereunder.
(b) All obligations of Seller contained in this Agreement,
shall have been fully performed in all material respects and Seller shall not be
in default under any covenant, restriction, right-of-way or easement affecting
the Property.
(c) There shall have been no material adverse change in the
Property, its operations or future prospects, the Leases or the financial
condition of tenants leasing space in the Shopping Center.
(d) A Title Insurance Commitment in the full amount of the
Purchase Price shall have been issued and "marked down" through Closing, subject
only to Permitted Exceptions.
(e) The physical and environmental condition of the Property
shall be unchanged from the date of this Agreement, ordinary wear and tear
excepted.
(f) Seller shall have delivered to Buyer the following in form
reasonably satisfactory to Buyer:
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(1) A limited warranty deed in proper form for recording, duly
executed and acknowledged so as to convey to Buyer the fee simple title to the
Property, subject only to the Permitted Exceptions;
(2) Originals, if available, or if not, true copies of the Leases and
of the contracts, agreements, permits and licenses, and such Materials as may be
in the possession or control of Seller, including without limitation all tenant
files and correspondence;
(3) A blanket assignment to Buyer of all Leases and the
contracts, agreements, permits and licenses (to the extent assignable) as they
affect the Property, including an indemnity against breach of such instruments
by Seller prior to the Closing Date;
(4) A bill of sale with respect to the Personal Property and
Materials;
(5) The Survey;
(6) A current rent roll for all Leases in effect showing no
changes from the rent roll attached to this Agreement other than those set forth
in the Leases or approved in writing by Buyer;
(7) All Tenant Estoppel Letters obtained by Seller, which must
include Big Bear, Blockbuster, H&R Block, Society Bank and Subway, and eighty
percent (80%) of the other tenants who have signed leases for any portion of the
Property, without any material exceptions, covenants, or changes to the form
approved by Buyer and distributed to the tenants by Seller, the substance of
which Tenant Estoppel Letters must be acceptable to Buyer in all respects;
(8) A general assignment of all assignable existing warranties
relating to the Property;
(9) An owner's affidavit, non-foreign affidavits, non-tax
withholding certificates and such other documents as may reasonably be required
by Buyer or its counsel in order to effectuate the provisions of this Agreement
and the transactions contemplated herein;
(10) The originals or copies of any real and tangible personal
property tax bills for the Property for the tax year of Closing and the previous
year, and, if requested, the originals or copies of any current water, sewer and
utility bills which are in Seller's custody or control;
- - 20 -
(11) Resolutions and/or affidavits of Seller authorizing the
transactions described herein;
(12) All keys and other means of access to the Improvements in
the possession of Seller or its agents;
(13) Materials; and
(14) Such other documents as Buyer may reasonably request to
effect the transactions contemplated by this Agreement.
(g) Buyer shall have received from the holder of the Surviv-
ing Mortgage, and approved, the estoppel letter and the documents by which
such holder approves the transfer of the Property to Buyer and the assumption
by Buyer, if necessary, of the obligations of the Surviving Mortgage.
(h) If applicable, Regency and Seller shall have executed the
Partnership Agreement and the Redemption Agreement.
In the event that all of the foregoing provisions of this
Section are not satisfied and Buyer elects in writing to terminate this
Agreement, then the Earnest Money Deposit shall be promptly delivered to Buyer
by Escrow Agent and, upon the making of such delivery, neither party shall have
any further claim against the other by reasons of this Agreement, except as
provided in Article .
8.2 Conditions Precedent to Seller's Obligations. The obligations of
Seller under this Agreement are subject to satisfaction or waiver by Seller of
each of the following conditions or requirements on or before the Closing date:
(a) Buyer's warranties and representations under this
Agreement shall be true and correct in all material respects as of the Closing
Date, and Buyer shall not be in default hereunder.
(b) All of the obligations of Buyer contained in this
Agreement shall have been fully performed by or on the date of Closing in
compliance with the terms and provisions of this Agreement.
(c) Buyer shall have delivered to Seller at or prior to the
Closing the following, which shall be reasonably satisfactory to Seller:
(1) If applicable, delivery and/or payment of the balance
of the Purchase Price in accordance with Section at Closing;
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(2) Such other documents as Seller may reasonably request
to effect the transactions contemplated by this Agreement.
(d) Seller shall have received and approved the estoppel
letter from the holder of the Surviving Mortgage and the terms and conditions of
the release of Seller from the obligations imposed by the Surviving Mortgage.
(e) If applicable, Regency and Seller shall have executed the
Partnership Agreement and the Redemption Agreement.
In the event that all conditions precedent to Buyer's
obligation to purchase shall have been satisfied but the foregoing provisions of
this Section have not, and Seller elects in writing to terminate this Agreement,
then the Earnest Money Deposit shall be promptly delivered to Seller by Escrow
Agent and, upon the making of such delivery, neither party shall have any
further claim against the other by reasons of this Agreement, except as provided
in Article .
8.3 Best Efforts. Each of the parties hereto agrees to use reasonable
best efforts to take or cause to be taken all actions necessary, proper or
advisable to consummate the transactions contemplated by this Agreement.
9. PRE-CLOSING BREACH; REMEDIES
9.1 Breach by Seller. In the event of a breach of Seller's covenants or
warranties herein and failure by Seller to cure such breach within the time
provided for Closing, Buyer may, at Buyer's election (i) terminate this
Agreement and receive a return of the Earnest Money Deposit, and the parties
shall have no further rights or obligations under this Agreement (except as
survive termination); (ii) enforce this Agreement by suit for specific
performance; or (iii) waive such breach and close the purchase contemplated
hereby, notwithstanding such breach.
9.2 Breach by Buyer. In the event of a breach of Buyer's covenants or
warranties herein and failure of Buyer to cure such breach within the time
provided for Closing, Seller's sole remedy shall be to terminate this Agreement
and retain Buyer's Earnest Money Deposit as agreed liquidated damages for such
breach, and upon payment in full to Seller of such amounts, the parties shall
have no further rights, claims, liabilities or obligations under this Agreement
(except as survive termination).
- - 22 -
10. POST CLOSING INDEMNITIES AND COVENANTS
10.1 Seller's Indemnity. Should this transaction close, Seller, subject
to the limitations set forth herein, shall indemnify, defend and hold harmless
Buyer from all claims, demands, liabilities, damages, penalties, costs and
expenses, including, without limitation, reasonable attorneys' fees and
disbursements, which may be imposed upon, asserted against or incurred or paid
by Buyer by reason of, or on account of, any breach by Seller of Seller's
warranties, representations and covenants. Except as set forth in this Agreement
to the contrary, Seller's warranties, representations and covenants, and the
foregoing indemnity, shall survive the Closing for a period of two (2) years.
Buyer's rights and remedies herein against Seller shall be in addition to, and
not in lieu of all other rights and remedies of Buyer at law or in equity.
10.2 Buyer's Indemnity. Should this transaction close, Buyer shall
indemnify, defend and hold harmless Seller from all claims, demands,
liabilities, damages, penalties, costs and expenses, including, without
limitation, reasonable attorneys' fees and disbursements, which may be imposed
upon, asserted against or incurred or paid by Seller by reason of, or on account
of, any breach by Buyer of Buyer's warranties, representations and covenants.
Except as set forth in this Agreement to the contrary, Buyer's warranties,
representations and covenants, and the foregoing indemnity, shall survive the
Closing for a period of two (2) years. Seller's rights and remedies herein
against Buyer shall be in addition to, and not in lieu of all other rights and
remedies of Seller at law or in equity.
11. MISCELLANEOUS
11.1 Disclosure. Neither party shall disclose the transactions
contemplated by this Agreement without the prior approval of the other, except
to its attorneys, accountants and other consultants, their lenders and
prospective lenders, or where disclosure is required by law.
11.2 Partnership Issues. Buyer and Seller agree that in the event
Seller elects the Contribution Alternative in Section 2.4 of this Agreement,
that Buyer shall assign this Agreement to Partnership, which shall assume all of
Buyer's obligations hereunder. Partnership has joined in this Agreement for the
purpose of agreeing to assume such obligations and be bound hereby if this
Agreement is assigned to it.
11.3 Entire Agreement. This Agreement, together with the exhibits
attached hereto, constitutes the entire agreement between the parties hereto
with respect to the subject matter hereof and may not be modified, amended or
otherwise changed in any manner except by a writing executed by Buyer and
Seller.
- 23 -
11.4 Notices. All notices and demands of any kind which either party
may be required or may desire to serve upon the other party in connection with
this Agreement shall be in writing and shall be served by personal delivery,
certified or overnight mail, reputable overnight courier service or fax
(followed promptly by hard copy) at the addresses set forth below:
As to Seller: PP Center Limited
Attention: Terry L. Sternad
110-B Northwoods Drive
Columbus, Ohio 43235
Phone: (614) 846-5330
Fax: (614) 846-7783
With a copy to: Jones, Day
Attention: Harlan W. Robins, Esq.
1900 Huntington Center
Columbus, Ohio 43215
Phone: (614) 469-3925
Fax: (614) 461-4198
As to Buyer: RRC Acquisitions Two, Inc.
Attention: Robert L. Miller
Suite 200, 121 W. Forsyth St.
Jacksonville, Florida 32202
Phone: (904) 356-7000
Fax: (904) 354-1832
With a copy to: Rogers, Towers, Bailey, Jones & Gay
Attention: William E. Scheu, Esq.
1301 Riverplace Blvd., Suite 1500
Jacksonville, Florida 32207
Phone: (904) 398-3911
Fax: (904) 396-0663
Any notice or demand so served shall constitute proper notice hereunder upon
delivery to the United States Postal Service or to such overnight courier. A
party may change its notice address by notice given in the aforesaid manner.
11.5 Headings. The titles and headings of the various sections hereof
are intended solely for means of reference and are not intended for any purpose
whatsoever to modify, explain or place any construction on any of the provisions
of this Agreement.
- - 24 -
11.6 Validity. If any of the provisions of this Agreement or the
application thereof to any persons or circumstances shall, to any extent, be
invalid or unenforceable, the remainder of this Agreement by the application of
such provision or provisions to persons or circumstances other than those as to
whom or which it is held invalid or unenforceable shall not be affected thereby,
and every provision of this Agreement shall be valid and enforceable to the
fullest extent permitted by law.
11.7 Attorneys' Fees. In the event of any litigation between the
parties hereto to enforce any of the provisions of this Agreement or any right
of either party hereto, the unsuccessful party to such litigation agrees to pay
to the successful party all costs and expenses, including reasonable attorneys'
fees actually incurred, whether or not incurred in trial or on appeal, incurred
therein by the successful party, all of which may be included in and as a part
of the judgment rendered in such litigation. Any indemnity provisions herein
shall include indemnification for reasonable attorneys' fees and costs, whether
or not suit be brought and including fees and costs actually incurred, whether
or not suit be brought and including fees and costs actually occurred on appeal.
11.8 Time of Essence. Time is of the essence of this Agreement.
11.9 Governing Law. This Agreement shall be governed by the laws of
the state in which the Property is located.
11.10 Successors and Assigns. The terms and provisions of this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns. No third parties, including any
brokers or creditors, shall be beneficiaries hereof.
11.11 Exhibits. All exhibits attached hereto are incorporated herein by
reference to the same extent as though such exhibits were included in the body
of this Agreement verbatim.
11.12 Gender; Plural; Singular; Terms. A reference in this Agreement to
any gender, masculine, feminine or neuter, shall be deemed a reference to the
other, and the singular shall be deemed to include the plural and vice versa,
unless the context otherwise requires. The terms "herein," "hereof,"
"hereunder," and other words of a similar nature mean and refer to this
Agreement as a whole and not merely to the specified section or clause in which
the respective word appears unless expressly so stated.
11.13 Further Instruments, Etc. This Agreement may be executed in
counterparts and when so executed shall be deemed executed as one agreement.
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Seller and Buyer shall execute any and all documents and perform any and all
acts reasonably necessary to fully implement this Agreement.
11.14 Survival. The obligations of Seller and Buyer intended to be
performed after the Closing shall survive the closing.
11.15 No Recording. Neither this Agreement nor any notice, memorandum
or other notice or document relating hereto shall be recorded.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
Witnesses:
RRC ACQUISITIONS TWO, INC.,
a Florida corporation
Name:
By:
Name:
Name: Title:
Date: August , 1998
Tax Identification No: 59-3478325
"BUYER"
REGENCY CENTERS, L.P., a Delaware
limited partnership
By its General Partner:
REGENCY REALTY CORPORATION,
a Florida corporation
Name:
By:
Name:
Name: Title:
Date: August , 1998
Tax Identification No: 59-3429602
"PARTNERSHIP"
- 26 -
PP CENTER LIMITED, an Ohio
limited liability company
By Its Authorized Member:
Name:
By:
Name:
Name: Title:
Date: August , 1998
Tax Identification No:
"SELLER"
JOINDER OF ESCROW AGENT
1. Duties. Escrow Agent joins herein for the purpose of agreeing to
comply with the terms hereof insofar as they apply to Escrow Agent. Escrow Agent
shall receive and hold the Earnest Money Deposit in trust, to be disposed of in
accordance with the provisions of this joinder and the foregoing Agreement. The
Earnest Money Deposit shall be invested by Escrow Agent in an interest bearing
account at a national bank acceptable to Buyer and Seller.
2. Indemnity. Escrow Agent shall not be liable to either party except
for claims resulting from the gross negligence or willful misconduct of Escrow
Agent. If the escrow is involved in any controversy or litigation, the parties
hereto shall jointly and severally indemnify and hold Escrow Agent free and
harmless from and against any and all loss, cost, damage, liability or expense,
including costs of reasonable attorneys' fees actually incurred by Escrow Agent
or to which Escrow Agent may be put incur by reason of or in connection with
such controversy or litigation, except to the extent it is finally determined
that such controversy or litigation resulted from Escrow Agent's gross
negligence or willful misconduct. If the indemnity amounts payable hereunder
result from the fault of Buyer or Seller (or their respective agents), the party
at fault shall pay, and hold the other party harmless against, such amounts.
- - 27 -
3. Conflicting Demands. If conflicting demands are made upon Escrow
Agent or Escrow Agent is uncertain with respect to the escrow, the parties
hereto expressly agree that Escrow Agent shall have the absolute right to do
either or both of the following: (i) withhold and stop all proceedings in
performance of this escrow and await settlement of the controversy by final
appropriate legal proceedings or otherwise as it may require; or (ii) file suit
for declaratory relief and/or interpleader and obtain an order from the court
requiring the parties to interplead and litigate in such court their several
claims and rights between themselves. Upon the filing of any such declaratory
relief or interpleader suit and tender of the Earnest Money Deposit to the
court, Escrow Agent shall thereupon be fully released and discharged from any
and all obligations to further perform the duties or obligations imposed upon
it. Buyer and Seller agree to respond promptly in writing to any request by
Escrow Agent for clarification, consent or instructions. Any action proposed to
be taken by Escrow Agent for which approval of Buyer and/or Seller is requested
shall be considered approved if Escrow Agent does not receive written notice of
disapproval within five (5) business days after a written request for approval
is received by the party whose approval is being requested. Escrow Agent shall
not be required to take any action for which approval of Buyer and/or Seller has
been sought unless such approval has been received. No disbursements shall be
made, other than as provided in Sections and of the foregoing Agreement, or to a
court in an interpleader action, unless Escrow Agent shall have given written
notice of the proposed disbursement to Buyer and Seller and neither Buyer nor
Seller shall have delivered any written objection to the disbursement within
five (5) business days after receipt of Escrow Agent's notice. No notice by
Buyer or Seller to Escrow Agent of disapproval of a proposed action shall affect
the right of Escrow Agent to take any action as to which such approval is not
required.
4. Tax Identification. Seller and Buyer shall provide to Escrow Agent
appropriate Federal tax identification numbers.
OHIO TITLE CORPORATION, AS AGENT FOR
FIRST AMERICAN TITLE INSURANCE
COMPANY
By:
Its Authorized Agent
Date: , 1998
"ESCROW AGENT"
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EXHIBIT
Audit Representation Letter
--------------------------
(Acquisition Completion Date)
KPMG Peat Marwick LLP
Suite 2700
One Independent Drive
Jacksonville, Florida 32202
Dear Sirs:
We are providing this letter in connection with your audit of the
Statement of Revenues and Certain Expenses for the twelve months ended
________________, for the purpose of expressing an opinion as to whether the
financial statement presents fairly, in all material respects, the results of
its operations of Park Place Shopping Center.
Certain representations in this letter are described as being limited
to matters that are material. Items are considered material, regardless of size,
if they involve an omission or misstatement of accounting information that, in
the light of surrounding circumstances, makes it probable that the judgment of a
reasonable person relying on the information would be changed or influenced by
the omission or misstatement.
We confirm, to the best of our knowledge and belief, the following
representations made to you during your audit:
1. The financial statement referred to above is fairly presented
in conformity with Seller's customary accounting standards,
consistently applied.
2. We have made available to you:
a. All financial records and related data.
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b. All agreements or amendments to agreements which
would have a material impact on the Statement of
Revenues and Certain Expenses.
3. There have been no:
a. Instances of fraud involving management or employees
who have significant roles in internal control.
b. Instances of fraud involving others that could have a
material effect on the Statement of Revenue and
Certain Expenses.
c. Violations or possible violations of laws or
regulations, the effects of which should be
considered for disclosure in the Statement of Revenue
and Certain Expenses or as a basis for recording a
loss contingency.
4. There are no:
a. Unasserted claims or assessments that our lawyers
have advised us are probable of assertion and must be
disclosed in accordance with Statement of Financial
Accounting Standards No. 5 Accounting for
Contingencies (SFAS No. 5).
b. Material gain or loss contingencies (including oral
and written guarantees) that are required to be
accrued or disclosed by SFAS No. 5.
c. Material transactions that have not been properly
recorded in the accounting records underlying the
Statement of Revenues and Certain Expenses.
d. Events that have occurred subsequent to
______________ and through the date of this letter
that would require adjustment to or disclosure in the
Statement of Revenues and Certain Expenses.
5. The Company has complied with all aspects of contractual
agreements that would have a material effect on the Statement
of Revenues and Certain Expenses in the event of
noncompliance.
6. All related party transactions have been properly recorded or
disclosed in the Statement of Revenues and Certain Expenses.
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Further, we acknowledge that we are responsible for the fair
presentation of the Statements of Revenue and Certain Expenses in conformity
with generally accepted accounting principles.
Very truly yours,
"Seller/Manager"
Name
Title
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EXHIBIT
Partnership Agreement
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EXHIBIT
Legal Description of Real Property
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EXHIBIT
Redemption Agreement
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EXHIBIT
Rent Roll
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EXHIBIT
Form of Estoppel Letter
_____________________, 199_
RRC Acquisitions Two, Inc.
Regency Centers, L.P.
121 W. Forsyth St., Suite 200
Jacksonville, Florida 32202
RE: ___________________________ (Name of Shopping Center)
Ladies and Gentlemen:
The undersigned (Tenant) has been advised you may purchase the above
Shopping Center, and we hereby confirm to you that:
1. The undersigned is the Tenant of ___________________________,
Landlord, in the above Shopping Center, and is currently in
possession and paying rent on premises known as Store No.
_______________ [or Address:
-----------------------------------------------------------],
and containing approximately _____________ square feet, under
the terms of the lease dated ______________________, which has
(not) been amended by amendment dated ________________________
(the "Lease"). There are no other written or oral agreements
between Tenant and Landlord. Tenant neither expects nor has
been promised any inducement, concession or consideration for
entering into the Lease, except as stated therein, and there
are no side agreements or understandings between Landlord and
Tenant.
2. The term of the Lease commenced on ____________________,
expiring on ___________________, with options to extend of
________________ (____) years each.
3. As of ____________________, monthly minimum rental is
$_______________ a month.
4. Tenant is required to pay its pro rata share of Common Area
Expenses and its pro rata share of the Center's real property
taxes and insurance cost. Current additional monthly payments
for expense reimbursement total $____________ per month for
common area maintenance, property insurance and real estate
taxes.
5. Tenant has given [no security deposit] [a security deposit of
$--------------].
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6. No payments by Tenant under the Lease have been made for more
than one (1) month in advance, and minimum rents and other
charges under the Lease are current.
7. All matters of an inducement nature and all obligations of the
Landlord under the Lease concerning the construction of the
Tenant's premises and development of the Shopping Center,
including without limitation, parking requirements, have been
performed by Landlord.
8. The Lease contains no first right of refusal, option to
expand, option to terminate, or exclusive business rights,
except as follows:
9. Tenant knows of no default by either Landlord or Tenant under
the Lease, and knows of no situations which, with notice or
the passage of time, or both, would constitute a default.
Tenant has no rights to off-set or defense against Landlord as
of the date hereof.
10. The undersigned has not entered into any sublease, assignment
or any other agreement transferring any of its interest in the
Lease or the Premises except as follows:
11. Tenant has not generated, used, stored, spilled, disposed of,
or released any hazardous substances at,on or in the Premises.
"Hazardous Substances" means any flammable, explosive, toxic,
carcinogenic, mutagenic, or corrosive substance or waste,
including volatile petroleum products and derivatives and
drycleaning solvents. To the best of Tenant's knowledge, no
asbestos or polychlorinated biphenyl ("PCB") is located at, on
or in the Premises. The term "Hazardous Substances" does not
include those materials which are technically within the
definition set forth above but which are contained in
pre-packaged office supplies, cleaning materials or personal
grooming items or other items which are sold for consumer or
commercial use and typically used in other similar
buildings or space.
The undersigned makes this statement for your benefit and protection with the
understanding that you intend to rely upon this statement in connection with
your intended purchase of the above described Premises from Landlord. The
undersigned agrees that it will, upon receipt of written notice from Landlord,
commence to pay all rents to you or to any Agent acting on your behalf.
Very truly yours,
___________________________________(Tenant)
Mailing Address:
____________________________ By:________________________________________
Its:_________________________________
- ----------------------------
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EXHIBIT
Document Request List
Items Required from the Seller:
1) Property Specifications (Zoning)
2) As Built Plans & Specs (arch. and engineering)
** 3) Site Plan (including suite numbers)
4) Location maps
5) Aerial photographs
6) Demographics (including traffic counts)
7) Legal Description
8) Parking Information - Space count
** 9) Copy of All Leases (and amendments) & Lease Briefs
10) Certificates of Occupancy - All current tenants
11) Schedule of Security Deposits
** 12) Most recent Rent Roll (with suite #'s, rent escalations, and option
period info)
** 13) Sales Reports (most recent 3 Years) for tenants reporting
14) Current Rent Billings (by category, base, CAM, etc.)
** 15) Current Delinquency Report (with explanations for balances > $1,000)
16) Tenant Activity Register for all Current Tenants (billings & payments)
17) Tenant Estoppels
** 18) Property Operating Results - Most recent 3 Years 19) Property
Capital Expenditures - Most recent 3 Years 20) Audited Financial
Statements - 3 Years 21) Real Estate and other tax bills - 3 Years 22)
Year to Date Financials & YTD detail general Ledger
** 23) Existing Service Agreements and Warranties
24) Three years loss history - reported claims
** 25) Most Recent Year Expense Recovery Reconciliation
26) Breakdown of CAM Pools
27) Proof Sales Tax Payments are Current
28) Appraisal (last available)
** 29) Seller's Budget for up-coming/current year
30) Utility Bills for last 12 mths/deposits
31) Personal Property Inventory
32) Existing Title Insurance Policy
** 33) Available Inspection Reports (environmental, roof, structural, etc.)
34) Summary of Tenant Contacts (with address and telephone numbers)
With local (incld store#) & national addresses
**35) Seller's Existing Survey
36) Tax plat map
** Required documents for commencement of Inspection Period.
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