PURCHASE AND SALE AGREEMENT
AND ESCROW INSTRUCTIONS
BETWEEN
CHICO CROSSROADS CENTER, LTD.
A CALIFORNIA LIMITED PARTNERSHIP
"SELLER"
- AND -
BASIC ACQUISITION, INC.
A DELAWARE CORPORATION
"BUYER"
Chicago Title
16969 Von Karman
Irvine, California 92714
Attn: Karen Price
Escrow # 6026054-M19
TABLE OF CONTENTS
PAGE
1. ESCROW..................................................................1
2. THE PROPERTY............................................................1
3. PURCHASE PRICE..........................................................1
4. PAYMENT OF PURCHASE PRICE...............................................1
a. Initial Deposit .................................................1
b. Second Deposit...................................................1
c. Assumption of Existing Loan......................................2
d. Cash Balance.....................................................2
e. Interest.........................................................2
5. INVESTIGATION AND APPROVAL OF PROPERTY..................................2
a. Right to Inspect Property........................................2
b. Approval of Condition of Property................................3
c. Prior Investigations.............................................3
d. Title Review.....................................................3
e. New Loan Approval................................................3
6. CLOSING; CLOSE OF ESCROW................................................4
a. Closing..........................................................4
b. Close of Escrow..................................................4
c. Closing Costs....................................................4
7. CLOSING - SELLER'S ITEMS................................................5
8. CLOSING - BUYER'S ITEMS.................................................6
9. CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE.....................6
10. CONDITIONS PRECEDENT TO SELLER'S OBLIGATION TO CLOSE....................7
11. CANCELLATION FEES AND EXPENSES..........................................8
12. WITHHOLDING.............................................................8
13. POSSESSION..............................................................8
14. REPRESENTATIONS AND WARRANTIES..........................................8
a. By Buyer.........................................................8
b. By Seller........................................................8
15. PRORATIONS.............................................................10
a. General.........................................................10
b. Rentals.........................................................10
c. Delinquent Rentals..............................................10
d. Operating Cost Pass Throughs, Etc...............................11
e. Prepaid Rentals.................................................11
f. Taxes and Assessments...........................................11
g. Tenant Deposits.................................................11
h. Service Contracts...............................................11
i. Prepaid Expenses................................................12
16. BROKERS................................................................12
17. DEFAULT AND REMEDIES...................................................12
a. Default and Remedies............................................12
b. Liquidated Damages..............................................12
18. CONDEMNATION...........................................................13
19. ATTORNEYS' FEES........................................................13
20. Notices................................................................13
21. Governing Law..........................................................14
22. Integration: Modification; Waiver......................................14
23. COUNTERPART EXECUTION..................................................14
24. HEADINGS; CONSTRUCTIONS................................................14
25. TIME OF THE ESSENCE....................................................14
26. Opening Of Escrow......................................................15
27. Invalid Provisions.....................................................15
28. Binding Effect.........................................................15
29. Further Acts...........................................................15
30. Exhibits...............................................................15
31. SURVIVAL...............................................................15
32. ASSIGNMENT.............................................................15
TABLE OF EXHIBITS
Exhibit A - Legal Description of Property
Exhibit B - Property Documents
Exhibit C - Grant Deed
Exhibit D - Bill of Sale
Exhibit E - Tenant Lease Agreement
Exhibit F - IRC Affidavit
Exhibit G - Tenant Leases
Exhibit H - Assignment of Service Contracts
Exhibit I - Assignment of Contract Rights
Exhibit J - Tenant Estoppel Certificate
Exhibit K - Landlord Estoppel Certificate
Exhibit L - Guaranty
Exhibit M - Commission Allocation Schedule
PURCHASE AND SALE AGREEMENT
AND
ESCROW INSTRUCTIONS
THIS PURCHASE AND SALE AGREEMENT AND ESCROW INSTRUCTIONS (this
"Agreement") is made as of May 8, 1996, (the "Effective Date") between BASIC
ACQUISITION INC., a Delaware corporation ("Buyer") and CHICO CROSSROADS
CENTER, a California limited partnership ("Seller") with reference to the
following facts:
A. Seller is the owner of the improved real property located in the
City of Chico, State of California, more particularly described in EXHIBIT "A"
attached hereto and incorporated herein by this reference (the "Property").
B. The term "Property" when used herein shall be deemed to include
all buildings, fixtures, structures, parking areas, landscaping and other
improvements and located thereon.
C. Seller desires to sell and convey to Buyer, and Buyer desires to
purchase and accept from Seller, the Property in accordance with and subject to
the terms and conditions set forth below.
NOW THEREFORE, Seller and Buyer agree as follows:
1. ESCROW. The transaction herein contemplated shall be effected
through an escrow ("Escrow") with Chicago Title Insurance Company ("Escrow
Agent"), as established by this Agreement and any additional written escrow
instructions required by Escrow Agent and approved by Seller and Buyer as
evidenced by their respective signatures thereon. In the event of any conflict,
uncertainty or ambiguity between or in respect of any additional written escrow
instructions and this Agreement, the provisions of this Agreement shall govern
and control. This Agreement constitutes joint escrow instructions to Escrow
Agent to complete the transaction contemplated herein. Escrow shall confirm to
each party the date of opening of Escrow ("Opening of Escrow").
2. THE PROPERTY. Seller shall sell and convey to Buyer, and Buyer
shall purchase and accept from Seller the Property.
3. PURCHASE PRICE. The purchase price (the "Purchase Price") for the
Property shall be Twenty One Million Seventy Five Thousand Dollars
($21,075,000.00).
4. PAYMENT OF PURCHASE PRICE. The Purchase Price shall be paid as
follows:
(a) INITIAL DEPOSIT. Buyer shall concurrently with the opening
of Escrow, deliver to Escrow Agent the sum of One Hundred Thousand Dollars
($100,000.00) ("Initial Deposit"). At Close of Escrow, Buyer shall receive a
credit toward the Purchase Price in an amount equal to the Initial Deposit.
(b) SECOND DEPOSIT. Within one (1) day following the Approval
Date (as defined herein) Buyer shall deposit into Escrow the sum of One Hundred
Fifty Thousand Dollars ($150,000.00) ("Second Deposit"). At Close of Escrow the
Second Deposit shall be applicable to the Purchase Price. The Initial Deposit
and the Second Deposit together with interest thereon, are sometimes
collectively referred to herein as the "Deposit".
(c) ASSUMPTION OF EXISTING FINANCING. Seller currently has a
loan from First Interstate Bank ("Lender") secured by, among other things, a
deed of trust encumbering the Property (the "Existing Loan"). In addition,
Seller and Buyer anticipate that Seller will enter into negotiations with one or
more lenders other than Lender to attempt to obtain during the Approval Period a
new loan for the purpose of refinancing the Existing Loan (the "New Loan"). The
New Loan and the Existing Loan, are sometimes referred to herein collectively as
the "Loans". In no event shall Buyer have any obligation to assume the Existing
Loan or the New Loan. At Close of Escrow, if Buyer assumes either of the Loans
pursuant to Paragraph 5(e), Buyer shall receive a credit against the Purchase
Price in an amount equal to the outstanding principal balance of the assumed
loan as of the Close of Escrow, and Seller shall pay to Lender any assumption
fee in connection with the assumption of the Existing Loan by Buyer. Buyer
shall pay any assumption fee and cost associated with any assumption of the New
Loan.
(d) CASH BALANCE. On or before the date which is one (1)
business day prior to the Closing Date, Buyer shall deposit into Escrow in cash
or other immediately available funds, or by federal wire of immediately
available funds, the balance of the Purchase Price, together with Buyer's share
of prorations and expenses, less the amount of the Extension Payment, if any
(collectively, the "Closing Funds").
(e) INTEREST. Escrow Agent shall keep the Deposit invested in
an interest bearing money market account with a financial institution reasonably
acceptable to Buyer and Seller at such yield as shall be available. Buyer shall
pay taxes upon the interest component of the Deposit. Escrow Agent shall bear
no liability for any loss occasioned by investment of the Deposit as herein
provided, by any delays in investing the Deposit or by any failure to achieve
the maximum possible from the Deposit.
5. INVESTIGATION AND APPROVAL OF PROPERTY.
(a) RIGHT TO INSPECT PROPERTY. Seller has caused to be
delivered to Buyer the documents identified in Exhibit "B" hereto ("Property
Documents"). Within the period commencing on the Opening of Escrow and ending
sixty (60) days thereafter ("Approval Period"), Buyer shall have the right
following at least 24 hour prior notice to Seller, to inspect the Property at
any reasonable time to conduct at its sole cost and expense, such customary
surveys, studies and investigations of all matters pertaining to the Property
including but not limited to, the soil, compaction, drainage, seismic
environmental or other geologic and topographical matters, the presence or
absence of any toxic or hazardous waste material or substance, the Property's
compliance with existing laws, ordinances, regulations and codes, the condition
of all streets, sewer, storm drains and utilities or availability of all of the
foregoing and other services to the Property, all matters pertaining to
surrounding properties and the use thereof, analysis of all tenants of the
Property ("Tenants"), zoning, use and other restrictions affecting the Property,
all other governmental and quasi governmental regulations concerning the use,
condition and improvement of the Property or any portion thereof, the Property's
fitness and economic feasibility for Buyer's intended use and development, and
any other matters relating in any manner to the Property or any portion thereof
or interest therein (collectively "Investigations") as Buyer deems necessary
concerning the Property. Prior to performing any of the Investigations, Buyer
shall obtain all permits and authorizations and shall pay all applicable fees
required by any public body or agency in connection therewith; Buyer shall
indemnify, defend (through legal counsel reasonably acceptable to Seller), and
hold Seller, and the Property, harmless from all damage, loss or liability,
including without limitation attorneys' fees and costs of court, mechanics'
liens or claims, or claims or assertions thereof arising out of or in connection
with the entry onto or occupation of the Property by Buyer, its agents,
employees and contractors and sub-contractors. If required by Seller, Buyer
shall have caused any of its contractors or subcontractors conducting such
inspections and/or investigation to deliver to Seller, as a condition to such
access to the Property, a certificate of insurance (naming Seller as an
additional insured) evidencing public liability insurance (from an insurance
company having a rating of at least "A" by A.M. Best) with limits of at least
One Million Dollars ($1,000,000.00) for bodily or personal injury or death, and
property damage insurance in the amount of at least Two Hundred Fifty Thousand
Dollars $250,000.00). After each such inspection or investigation of the
Property, Buyer agrees to immediately restore the Property or cause the Property
to be restored to its condition before each such inspection or investigation
look place, at Buyer's sole expense.
(b) APPROVAL OF CONDITION OF PROPERTY. Buyer shall approve or
disapprove the Property, the Property Documents and the results of any
investigation or inspection on or before the expiration of the Approval Period.
Buyer must deliver to Seller written notice ("Property Approval Notice")
approving the Property, the Property Documents and the results of any
investigation or inspection Documents on or before the expiration of the
Approval Period. If the Property Approval Notice is not received by Seller on
or before three (3) business days following the expiration of the Approval
Period, the Property, the Property Documents and the results of any
investigation or inspection will be deemed disapproved by Buyer. If Buyer
disapproves the Property, the Property Documents, or the results of any
investigation or inspection Buyer shall provide written notice of same to
Seller. If Buyer fails to give notice of termination set forth herein, the
Property, the Property Documents or the results of any investigations or
inspection will be deemed disapproved by Buyer, and the Parties shall proceed in
accordance with Paragraph 11. If Buyer disapproves the Property Documents or
the results of any investigation or inspection as set forth herein, Seller shall
within five (5) days of such disapproval refund the Deposit to Buyer.
(c) PRIOR INVESTIGATIONS. Buyer agrees that it is a
sophisticated real estate investor and is relying upon its own inspections,
examinations, studies and inquiries to determine the condition of the Property,
including without limitation the construction of the improvements, soil and
subsoil condition, and that (subject to the provisions for termination of this
Agreement set forth in Paragraph 5(b) hereof and the representations and
warranties set forth herein) Buyer is purchasing the Property on as "AS IS"
basis, and no patent or latent condition affecting the Property in any way,
whether or not known or discoverable or hereafter discovered, shall affect
Buyer's obligation to purchase the Property or any of Buyer's other obligations
contained in this Agreement, nor shall any such condition give rise to any right
of damages, rescission of otherwise against Seller. Buyer acknowledges that
except for the representations and warranties set forth herein, neither Seller
nor any officer, employee or agent of Seller has made, is making or shall make
any representations or warranties whatsoever with respect to the Property, its
condition, its suitability for any use, its accessibility or any other matter,
except as may expressly be set forth herein. Furthermore, Buyer agrees that,
except for the representations and warranties set forth herein, it will satisfy
itself fully with respect to all laws, statutes, regulations and requirements of
all governmental bodies and agencies concerning the sale and/or construction of
the Property.
(d) TITLE REVIEW. Following Opening of Escrow, Seller shall
cause Chicago Title Insurance Company to deliver to Buyer a current preliminary
title report (the "PTR") for the Property together with legible copies of all
exceptions to title identified therein. Buyer shall have thirty (30) days
following its receipt of the PTR to give Seller its written notice of its
disapproval of any item on the PTR. ("Title Notice"). Following Seller's
receipt of the Title Notice, Seller shall have thirty (30) days to give written
notice to Buyer of Seller's election either to (a) cure such title defects prior
to Close of Escrow or (b) cancel escrow and terminate this Agreement in
accordance with the provisions of Paragraph 11 hereto and shall not be deemed a
default of Buyer or Seller.
(e) APPROVAL OF FINANCING. During the Approval Period, Buyer
shall approve or disapprove the financing for its purchase of the Property.
In the event the New Loan is finalized, and the documents evidencing and/or
securing the New Loan (e.g. promissory note, deed of trust, indemnity, etc.)
(collectively the "New Loan Documents") are delivered to Buyer at least 15
days prior to the end of the Approval Period, then Buyer shall approve or
disapprove the New Loan in accordance with this Paragraph 5(e). If the New
Loan is finalized, Seller shall pay all fees and costs associated with the
origination of the New Loan, but not any fees or costs associated with the
assumption of the New Loan by Buyer. If the New Loan is not finalized, and
the New Loan Documents are not delivered to Buyer at least 15 days prior to
the end of the Approval Period, then Seller shall not enter into the New Loan
without the prior written consent of Buyer, which consent may be granted or
withheld in Buyer's sole discretion, In that regard, Seller agrees to
provide Buyer, promptly after obtaining the same, copies of any documentation
proposed to evidence the New Loan. While Buyer shall not be obligated to do
so, Buyer may (i) approve and agree to assume the Existing Loan; (ii) approve
and agree to assume the New Loan, or (iii) elect to pay cash for the Property
and acquire the Property free and clear of any liens and encumbrances (and if
Buyer so elects, Seller covenants to convey the Property free and clear of
all liens and encumbrances securing the Existing Loan), and in the event that
Buyer elects any of the alternatives set forth in clauses (i), (ii) or (iii);
Buyer shall be deemed to have approved the financing for its purchase of the
Property. If Buyer elects alternative (iii) above, Buyer will receive a
credit against the Purchase Price at Close of Escrow equal to One Hundred and
Fifty Thousand Dollars ($150,000.00). Alternatively, Buyer may by notice to
Seller, prior to the end of the Approval Period, disapprove the financing for
its purchase of the Property, in which case Escrow shall be terminated in
accordance with the provisions of Paragraph 11 hereof, and such termination
shall not be deemed to have occurred by reason of default of Seller or Buyer.
6. CLOSING; CLOSE OF ESCROW.
(a) CLOSING. Provided that all of the conditions of this
Agreement shall have been satisfied or waived on or before the date(s) set forth
in Paragraph 9 and 10, the closing ("Closing") of this transaction shall take
place at the offices of Escrow Agent ninety (90) days following the expiration
of the Approval Period.
Buyer shall have the option to extend the Closing for an
additional ninety (90) days (the "Extension Period") by delivering written
notice of such election to Seller and Escrow Holder at least two (2) days
prior to the date scheduled for Closing and (ii) concurrently delivering into
Escrow by cashier's check the sum of Two Hundred and Fifty Thousand Dollars
($250,000.00) ("Extension Payment"). Provided Seller has delivered to Escrow
Holder the Grant Deed (as defined herein) and the Tenant Estoppel
Certificates (as defined herein), immediately following its receipt of the
Extension Payment, Escrow Holder shall release to Seller the Deposit and the
Extension Payment. Buyer may not terminate this Agreement, and shall remain
obligated to purchase the Property in the event that Buyer elects to extend
the closing regardless of any casualty, loss or other change in the Property.
Concurrently with the release of the Deposit to Seller, Seller shall assign
to Buyer all rights to recover under any such insurance required to be
carried under this Agreement and will cooperate with Buyer in adjusting the
claim against such insurance policy. The Extension Payment shall be deemed
earned when paid and shall not be refundable under any condition or
circumstance except for a default by Seller under this Agreement; provided,
however, that in the event that the transaction contemplated by this
Agreement closes, then the Extension Payment shall be applied against the
Purchase Price.
(b) CLOSE OF ESCROW. As used herein, the term "Close of
Escrow" shall mean the date on which the Grant Deed is recorded in Official
Records of Butte County, California.
(c) CLOSING COSTS.
(i) Seller shall pay:
(a) One-half (1/2) of the Escrow fees:
(b) The cost of documentary transfer taxes;
(c) The cost of issuing Buyer's Title Policy in
CLTA Standard form; and
(d) The cost of any other obligations of Seller
hereunder.
(ii) Buyer shall pay:
(a) One-half (1/2) of the Escrow fees;
(b) The cost to record the Grant Deed;
(c) Any additional premium charged for issuance
of an ALTA Extended form of Buyer's Title
Policy;
(d) The cost of any other obligations of Buyer
hereunder; and
(e) All costs associated with Buyer's assumption
of the New Loan.
7. CLOSING - SELLER'S ITEMS. Seller shall deliver or cause to be
delivered to Escrow Agent at least three (3) days before the Closing Date, the
following documents:
(a) A GRANT DEED. ("Grant Deed"), duly executed and
acknowledged by Seller in the form of and upon the terms and conditions
contained in Exhibit "C" attached hereto
(b) A BILL OF SALE. ("Bill of Sale") duly executed by Seller in
favor of Buyer in the form of, and upon the terms and conditions contained in
Exhibit "D" attached hereto.
(c) AN ASSIGNMENT OF LEASES. ("Tenant Lease Assignment") duly
executed and acknowledged in recordable form by Seller, in the form of and upon
the terms and conditions contained in Exhibit "E" attached hereto.
(d) IRC AFFIDAVIT. An affidavit under Section 1445 of the
United States Internal Revenue Code ("IRC Affidavit"), duly authorized and
executed by Seller in the form of Exhibit "F" attached hereto.
(e) TENANT LEASES. Originals of all of the Tenant Leases
indicated or designated as "original" on the List of Tenant Leases attached
hereto as
Exhibit "F".
(f) SERVICE CONTRACTS. Originals, if possessed by Seller,
otherwise copies of all service, maintenance, supply, security, and management
contracts ("Service Contracts") indicated on the List of Service Contracts
attached hereto as Exhibit "H".
(g) KEYS. All keys to entrance doors to the Improvements and
Keys to all Personal Property located on the Real Property and/or the
Improvements which are in Seller's possession.
(h) LICENSES AND PERMITS. Originals, or the best copies in the
possession of Seller of all licenses and permits affecting the Property.
(i) TENANT NOTIFICATIONS. Letters addressed to each of the
Tenants, notifying them of the sale of the Property to Buyer and directing them
to make all future payments of rent and deliver any future notices to the order
of Buyer.
(j) OTHER DOCUMENTS. Originals, or the best copies in Seller's
possession, of all other documents and instruments relating to the Property.
Escrow Agent shall deliver a conformed copy of the Grant
Deed and the original IRC Affidavit and each of the other documents and
instruments delivered into Escrow by Seller as set forth above to Buyer at the
Closing. The Grant Deed shall provide that it is to be returned to Escrow Agent
following recordation. When the original Grant Deed is returned to Escrow
Agent, Escrow Agent shall deliver the original Grant Deed to Buyer, with a copy
showing all recording information to Seller at the address noted in Paragraph 20
below.
8. CLOSING - BUYER'S ITEMS. Buyer shall deliver or cause to be
delivered to Escrow Agent on or before the date which is one (1) business day
prior to the Closing Date:
(a) the Closing Funds as required under subparagraph 4(d) and
(b) the Tenant Lease Assignment duly executed and
acknowledged in recordable form, in counterpart.
9. CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE. Buyer's
obligation to consummate the transaction contemplated hereunder is subject to
the satisfaction or waiver of the conditions set forth below at or before the
dates specified below. Escrow Agent shall proceed as though all conditions have
been satisfied or waived unless Escrow Agent receives a written notice from
Buyer terminating this Agreement and stating that any one or more of the
conditions for the benefit of Buyer is not satisfied before the dates specified
below. The following conditions are for the benefit of the Buyer and can only
be waived by Buyer prior to the Closing Date:
(a) Seller has timely delivered into Escrow all of the Seller's
items described in Paragraph 7 above;
(b) The Title Company has committed to issue to Buyer its
standard form California Land Title Association ("CLTA Standard") Standard
owner's policy of title insurance with coverage equal to the Purchase Price (the
"Title Policy") prior to the Closing Date. Buyer may order an American Land
Title Association extended owners' policy of title insurance ("ALTA Extended
Policy") with coverage equal to the Purchase Price, provided that Buyer pays for
all additional premiums, survey costs, and any other fees or costs attributable
thereto and Close of Escrow is not delayed thereby. The Title Policy shall show
title vested in Buyer SUBJECT ONLY TO:
(i) The printed exceptions contained in the Title
Company's standard owner's policy of title insurance
(CLTA Standard, or ALTA Extended if so requested by
Buyer);
(ii) General and special taxes and assessments not then
delinquent;
(iii) The exceptions set forth and approved in the
Preliminary Title Report;
(iv) Any matters created by or with the consent of Buyer;
and
(c) Buyer's approval of the condition of the Property in
accordance with Paragraph 5 on or before the expiration of the Approval Period.
(d) Seller's representation and warranties are true as of the
Closing Date.
(e) Buyer shall have received estoppel certificates ("Tenant
Estoppel Certificates") duly executed by Home Base, Office Depot, Food for Less,
Circuit City, Barnes & Noble, Hometown Buffet and Petco and Tenants occupying at
least ninety-five percent (95%), in the aggregate, of the gross leasable square
footage of the improvements currently leased, to be dated not more than forty-
five (45) days prior to the Closing Date. The Tenant Estoppel Certificates
shall be in the form of, and in all material aspects, upon the terms attached to
their respective leases, and if not attached to a tenant lease, in the form of,
and in all material aspects, upon the terms contained in, Exhibit "J" attached
hereto. If Buyer desires a different form of estoppel certificates, Seller
shall use its reasonable efforts to obtain such certificate from the tenants of
the Property, however, the failure to obtain such form of estoppel from any
Tenant shall not be a condition to Close of Escrow. Seller shall deliver the
Tenant Estoppel Certificates to Buyer no later than ten (10) days prior to the
Closing Date. In the event Seller is unable to obtain a Tenant Estoppel
Certificate from any Tenant, Seller shall provide to Buyer an estoppel
certificate executed by Seller ("Landlord Estoppel"), in the form of Exhibit "K"
attached hereto, subject to such facts and circumstances which are disclosed on
such statement. The Tenant Estoppel Certificates and the Landlord Estoppel
shall be subject to Buyer's reasonable approval. Buyer's failure to disapprove
any Tenant Estoppel Certificate or Landlord Estoppel in writing five (5) days of
receipt thereof by Buyer shall be deemed to constitute Buyer's approval thereof.
If Buyer reasonably disapproves any Tenant Estoppel Certificates or Landlord
Estoppel within such five (5) day period, Escrow shall be terminated in
accordance with the provisions of Paragraph 11 hereof.
(f) Satisfaction or waiver of all contingencies to the leases
with Barnes and Noble and Blockbuster Video.
(g) Seller's timely performance of its obligation hereunder.
(h) In the event that the Closing has not been extended
pursuant to Paragraph 6, there shall have been no material change in the
condition or operations of the Property. In the event that the Closing has been
extended pursuant to Paragraph 6, there shall have been no material change in
the condition or operations of the Property caused by any act or omission of
Seller.
If any of the above conditions are not satisfied at or prior to
the Closing, for a reason other than a default by Buyer under this Agreement,
Buyer may terminate this Agreement by written notice to Seller and Escrow Agent,
whereupon, Escrow shall be cancelled, Escrow Agent shall release the Deposit to
Buyer and any and all documents deposited into Escrow shall be returned to the
party entitled thereto, and the parties shall have no further rights or
obligations hereunder.
10. CONDITIONS PRECEDENT TO SELLER'S OBLIGATION TO CLOSE. Seller's
obligation to consummate the transaction contemplated hereunder is subject to
the satisfaction or waiver of the conditions set forth below before the dates
specified below. Escrow Agent shall proceed as though all conditions have been
satisfied or waived unless Escrow Agent receives a written notice from Seller
terminating this Agreement and stating that any one or more of the conditions
for the benefit of Seller is not satisfied before the dates specified below.
The following conditions are for the benefit of Seller and can only be waived by
Seller:
(a) Buyer has timely delivered into Escrow the Closing funds;
(b) Buyer has timely delivered into Escrow the Buyer's items
described in Paragraph 8 above; and
(c) Buyer's representations and warranties are true and correct
as of the Close of Escrow.
(d) Buyer has timely delivered into Escrow the fully executed
Guaranty in the form attached hereto as Exhibit "L".
If any of the above conditions are not satisfied at or
prior to the date called for in this Agreement, for a reason other than a
default by Seller under this Agreement, Seller may terminate this Agreement by
written notice to Buyer and Escrow Agent, whereupon, Escrow shall be cancelled,
Escrow Agent shall release to Seller all funds deposited by Buyer into Escrow
which remain in Escrow as of the date Escrow Agent receives Seller's written
notice of termination, and any and all documents deposited into Escrow shall be
returned to the party entitled thereto, and the parties shall have no further
rights or obligations hereunder.
11. CANCELLATION FEES AND EXPENSES. If Escrow terminates because of
the non-satisfaction of any condition for a reason other than the default of
Buyer or Seller under this Agreement, Buyer and Seller shall pay one-half of any
escrow cancellation charges and the Deposit shall be returned to Buyer.
However, if Escrow terminates because of the default of either Buyer or Seller
under this Agreement, the escrow cancellation charges shall be borne solely by
the defaulting party and, (i) if Seller is the defaulting party, the Deposit
shall be returned to Buyer, and (ii) if Buyer is the defaulting party, the
Deposit shall be retained by Seller. "Escrow cancellation charges" means all
fees, charges and expenses incurred by Escrow Agent as well as all expenses
related to the services of the Title Company in connection with issuance of the
Title Report and other title matters.
12. WITHHOLDING. Pursuant to Section 1445 of the Internal Revenue
Code of 1986, as amended ("Code"), Buyer is required to withhold ten percent
(10%) of the "amount realized" in accordance with the Code, unless Seller
delivers to Buyer the IRC Affidavit.
13. POSSESSION. Possession of the Property shall be delivered to
Buyer at the Closing.
14. REPRESENTATIONS AND WARRANTIES.
(a) BY BUYER. Buyer represents, warrants and covenants to and
with Seller, that Buyer has the right, power, legal capacity and authority to
execute, deliver and perform this Agreement. This Agreement constitutes the
legal, valid and binding obligation of Buyer.
(b) BY SELLER. Seller represents, warrants and covenants to
and with Buyer, that (i) except for the assignment of the New Loan or the
assumption of the Existing Loan, Seller has the right, power, legal capacity
and authority to execute, deliver and perform this Agreement and any consent
required as a condition to Seller's authority to execute, deliver and perform
this Agreement will be obtained prior to the Close of Escrow, (ii) the
individuals who have executed this Agreement on behalf of Seller have the
right, power, legal capacity and authority to execute, deliver and perform
this Agreement on behalf of Seller; (iii) this Agreement constitutes the
legal, valid and binding obligation of Seller; (iv) to Seller's knowledge,
Seller has not received notice of any pending or threatened condemnation of
all or of any portion of the Property, or notice of any violation of zoning
restrictions in respect of the Property from the governmental authority or
agency; (v) attached hereto as EXHIBIT"H" is a list of all of the Service
Contracts affecting the Property in effect on the date hereof (the "Service
Contracts), and except as set forth on EXHIBIT"H" (i) to Seller's actual
knowledge,the Service Contracts have not been further modified or amended and
are in force and effect, or are terminable with thirty (30) days notice, (ii)
Seller has, or will have, during the Approval Period delivered to Purchaser
true and complete copies of the Service Contracts, and (iii) to the best
actual knowledge of Seller, there are no defaults of Seller or any other
party thereto under the Service Contracts which would materially adversely
affect the operations of the Property or which would materially increase the
cost of operating the Property; (vi) attached hereto as Exhibit "I" is a list
of all licenses and permits from governmental authorities in the possession
of Seller in connection with its ownership of the Property (collectively, the
"Licenses and Permits") and Seller has, or will have, during the Approval
Period delivered to Purchaser true and complete copies of the Licenses and
Permits; (vii) Seller has not received written notice of any litigation,
governmental or administrative proceedings or arbitrations presently pending
or threatened in writing with respect to any of the Property, except for
actions which do not in any way affect the current use or operation of any of
the Property; (viii) to Seller's actual knowledge, there are no unrecorded
rights of first offer to purchase, rights of first refusal to purchase,
purchase options or similar rights or contractually required consents to
transfer pertaining to the Property which would be breached by this Agreement
or the consummation of the transactions provided for herein; (ix) Seller is
not a "foreign person" within the meaning of Paragraph 1445(f)(3) of the
Internal Revenue Code; (x) Seller has not filed or been the subject of any
filing of a petition under the Federal Bankruptcy Law or any insolvency laws,
or any laws for composition of indebtedness or for the reorganization of
debtors; (xi) to Seller's knowledge, the Seller has not received from any
insurance company which carries insurance on the Property, or any Board of
Fire Underwriters, any notice of any defect or inadequacy in connection with
the Property or its operation which has not been cured; (xii) except as
disclosed to Buyer in writing prior to the expiration of the Approval Period,
Seller has performed or will perform prior to the closing of the transactions
contemplated by this Agreement of all of Seller's obligations under any
leases of the Property that are or will be required to be performed prior to
the Closing and no brokerage commissions or other compensation is or will be
due or payable to any persons, firm, corporation or other entity with respect
to or on account of any of the leases, or any renewal thereof that could be a
lien against the Property or claim against Buyer and (xiii) except as
disclosed to Buyer in writing, to Seller's best actual knowledge, without any
duty to investigate, as of the Effective Date there are no hazardous
materials in existence on or below the surface of the Property or in any
building located upon the Property, including, without limitation,
contamination of the soils subsoil or ground water, which constitutes a
violation of any law, rule or regulation of any governmental entity having
jurisdiction thereof.
Seller hereby agrees, through and including the Closing and at
Seller's sole cost and expense to (a) keep all existing insurance policies
(including any renewals or equivalents) affecting the Property in full force
and effect (except that Seller shall be credited at Close of Escrow with an
amount equal to the amount expended by it during the Extension Period in good
faith in arms-length transactions and pursuant to the exercise of its
reasonable business judgment to repair the Property following a casualty to
the extent each sums expended are for uninsured casualties, unreimbursable
deductibles and unreimbursable capital expenses, casualties, unreimbursable
deductibles and unreimbursable capital expenses. If any such costs or
expenses are not emergency related and exceed Ten Thousand Dollars
($10,000.00), (i) Seller shall reasonably consult with Buyer prior to
incurring such expense (ii) competitively bid such expense to at least three
responsible bidders and (iii) contract with the lowest responsible bidder):
(b) use due diligence and its reasonable efforts to keep in full force and
effect all required licenses and permits; and (c) provide all services and
continue to operate, manage and maintain the Property in substantially the
same manner as it previously had. Following ten (10) days before expiration
of the Approval Period ("Lease Cut-off Date"). Seller hereby agrees that
Seller will not terminate or modify, extend of otherwise change any of the
terms, covenants or conditions of any tenant lease, or enter into new leases
or any other obligations or agreements affecting the Property without the
prior consent of Buyer, which consent may be withheld in Buyer's reasonable
discretion. Prior to the Lease Cut-Off Date, Seller shall have the right, in
its sole and absolute discretion, to enter into any such new lease provided
Seller deliver to Buyer a fully executed copy of such lease before the Lease
Cut-Off Date. Except as provided above, prior to the Closing Date, Seller
shall not convey title or any interest in the Property or the personal
property to any person or entity. Seller shall not subject the Property to
any additional liens, encumbrances, covenants, conditions, restrictions,
easements or similar matters after the date of this Agreement which will not
be eliminated prior to the Closing Date, or otherwise amend, modify, extend
or change the terms, covenants or conditions of any such matters after the
date of this Agreement. For a period of one (1) year after the Closing Date,
Seller shall cooperate with Buyer and Buyer's accountants and attorneys in
answering questions concerning the operation and management of the Property,
amounts owed by Tenants under their leases, the calculation of operation
expense or common area maintenance charge, and similar matters.
(c) Each Party's representations and warranties made herein are
material to the other Party's decision to enter into this Agreement and are
being relied upon by the other Party in undertaking its obligations hereunder.
Except to the extent set forth in writing prior to the Close of Escrow the
representations of each Party made herein shall be deemed made again as of the
Close of Escrow for the Property, or any portion thereof without the necessity
of further documentation. The representation and warranties of Seller set forth
above shall survive the Closing and the delivery of the Grant Deed for a period
of two (2) years.
15. PRORATIONS.
(a) GENERAL. For purposes of this Paragraph 15, the "Proration
Date" shall be deemed to be 11:59 p.m. on the day immediately proceeding the
Closing Date so that Buyer shall be deemed to be in title to the Property and
therefore entitled to the income and responsible for the expenses for the entire
day upon which the Closing Date occurs. Any apportionments and prorations which
are not expressly provided for below shall be made in accordance with customary
practice in Butte County. Buyer and Seller agree to prepare or cause their
respective representatives or accountants to prepare a schedule of tentative
adjustments prior to the Proration Date. Such adjustments, if and to the extent
known and/or estimated and agreed upon as of the Close of Escrow, shall be paid
by Buyer to Seller (if the prorations result in a net credit to the Seller) or
by Seller to Buyer (if the prorations result in a net credit to the Buyer), by
increasing or reducing the cash to be paid by Buyer at the Close of Escrow. Any
such adjustments not determined or not agreed upon as of the Close of Escrow
shall be paid by Buyer to Seller, or by Seller to Buyer, as the case may be, in
cash as soon as practicable following the determination of the information
necessary to make such adjustments, For a period of three (3) years following
the Close of Escrow, Buyer and Buyer's successors and assigns shall make
available to Seller and Seller shall make available to Buyer and Buyer's
successors and assigns and their respective employees, agents and
representatives all books and records maintained for the Property which relate
to any of the items to be prorated or allocated under this Agreement, which
books and records shall be made available for inspection and copying by Seller
and Seller's employees, agents and representatives during ordinary business
hours. Any such inspection shall be at reasonable intervals and at the
inspecting party's sole cost and expense. The provisions of this Paragraph 15
shall survive the Close of Escrow indefinitely.
(b) RENTALS. Subject to the provisions of Paragraphs 15(c) and
15(d), fixed monthly rentals ("Rentals") which have been collected shall be
prorated as of the Proration Date. Notwithstanding the provisions of the Tenant
Leases to the contrary, the base amount of rental provided in the Tenant Leases
shall be allocated equally on a monthly basis for the year in which the Close of
Escrow occurs. With respect to percentage rent, following Close of Escrow
Buyer shall collect all such percentage rent and shall pay to Seller the portion
of such percentage rent attributable to the period before Close of Escrow. Such
payment shall be made to Seller within ten (10) days following Buyer's receipt
of such percentage rent. If payment to Seller is not timely made, the
delinquent amount shall bear interest at 10% per annum.
(c) DELINQUENT RENTALS. Rentals for Tenant Leases that are
not more than thirty (30) days delinquent as of the Proration Date shall be
prorated between Seller and Buyer as if they were timely paid to Seller, and
Seller shall be credited with the amount of such Rental. Delinquent Rentals
shall be prorated between Buyer and Seller as of the Proration Date but not
paid by Seller until they are actually collected by Buyer, Rentals are
"Delinquent" when payment thereof has been due on or before the Proration
Date and is at least thirty (30) days past due as of the Proration Date.
Buyer shall use Buyer's good faith efforts to collect any Delinquent Rentals.
Buyer shall not, however, be required to institute legal proceedings and
Buyer shall not be required to expend more than nominal cost and expense in
collecting Delinquent Rentals. After the Close of Escrow, Seller shall not
institute any legal proceedings against a Tenant (or other occupant or user
of the Project) owing Delinquent Rentals unless Buyer has failed to institute
such legal proceedings within thirty (30) days after receipt of Seller's
written request that Buyer do so. Subject to the first sentence of this
subparagraph (c) rentals collected by the Buyer shall be applied first
against any amount currently due, to their respective due dates, and then
against any amount past due. Buyer agrees that any payments due to Seller as
a result of collected Delinquent Rentals shall be payable to Seller (less
reasonable out-of-pocket costs of collection actually incurred by Buyer) not
less often than monthly. Seller agrees that any amounts collected by Seller
after the Close of Escrow but which are due to Buyer hereunder shall be
payable to Buyer (less reasonable out-of-pocket costs of collection actually
incurred by Seller) not less often than monthly.
(d) OPERATING COST PASS-THROUGH, ETC.. Operating cost pass-
throughs, expense reimbursements, utility charges, common area maintenance
charges, any administrative charges, tenant or property association dues,
additional rentals and other retroactive rentals escalations, sums or charges
payable by Tenants which accrue as of the Proration Date but are not yet due and
payable, shall be prorated as of the Proration Date and Seller shall receive a
credit for such amounts at Close of Escrow. Seller agrees that any amounts
collected by Seller after the Close of Escrow but which are due to Buyer
hereunder shall be payable to Buyer promptly upon receipt thereof, but not less
often than monthly (less reasonable out-of-pocket costs of collection actually
incurred by Seller ). Promptly upon completion of the applicable payment
periods therefore which include the Close of Escrow, Buyer and Seller agree to
determine the amount of reimbursements received from Tenants with respect to
estimated tax, insurance and operating expense pass-throughs. To the extent
Seller has received from Tenants reimbursements for expenses in excess of those
reimbursable expenses actually paid by Seller for the period prior to the Close
of Escrow, Buyer shall be credited for such amount. Conversely, to the extent
Seller has received from Tenants less than the reimbursements required by their
Tenant Leases for such expenses, Seller shall be credited for such amounts at
Close of Escrow.
(e) PREPAID RENTALS. Rentals already received by Seller
attributable to periods after the Proration Date and the amount of any other
credits due Tenants applicable to any period or periods after the Closing Date
shall be credited to Buyer at the Close of Escrow.
(f) TAXES AND ASSESSMENTS. Any delinquent real estate taxes
and any delinquent installments of assessments (including penalties and charges)
on the Property shall be paid at the Close of Escrow from funds accruing to
Seller. All real estate taxes on the Property for the fiscal tax year in which
the Proration Date occurs shall be estimated based upon the most recently
available real estate tax bill and prorated as hereinafter described at the
Close of Escrow based upon such estimate. Buyer and Seller shall re-prorate the
real estate taxes following the Close of Escrow upon receipt of the actual real
estate tax bill for the fiscal year in which the Proration Date occurs. Buyer
shall be credited with an amount equal to all real estate taxes which have
accrued prior to the Proration Date but only to the extent such real estate
taxes are not paid or payable by Tenants. Buyer shall also be credited with an
amount equal to all real estate taxes already collected or received by Seller
from Tenants and attributable to periods prior to the Proration Date, so long as
such amounts have not previously been used to pay real estate taxes already due,
If, after the Proration Date, any additional real estate taxes are assessed
against the Property by reason of back assessments, corrections to previous tax
bills and similar reasons relating to the period prior to the Proration Date,
Seller shall pay all such additional real estate taxes, except to the extent the
same are collected from Tenants or which would then be currently due from
Tenants pursuant to the terms of their respective Tenants Leases, to the extent
such Tenant Leases are then currently in effect. If, after the Close of Escrow,
any real estate tax or assessment savings or refunds are made with respect to
the Property by reason of successful tax contest proceedings or appeals,
corrections to tax bills or similar reasons relating to the period prior to the
Proration Date, if funds remain after required payments to Tenants, then Seller
shall be promptly reimbursed for all amounts of such refund(s) or saving(s)
attributable to the period prior to the Proration Date, less Seller's reasonable
out-of-pocket costs of collection, and Buyer shall be entitled to all amounts of
such refund(s) or saving(s) attributed to the periods after the Proration Date.
(g) TENANT DEPOSITS. Buyer shall be credited at the Close of
Escrow with an amount equal to all Tenant security deposits remaining after any
permitted deduction or charge.
(h) SERVICE CONTRACTS. Amounts payable under the Service
Contracts and all utility charges shall be prorated on an accrual basis. All
amounts payable under the Service Contracts accruing prior to the Proration
Date shall be the obligation of Seller, but Seller shall at Close of Escrow pay
or credit Buyer therefor only to the extent such amounts are not paid or payable
by Tenants. Should Buyer not elect to terminate any service contracts as of
the Closing Date, Buyer shall be responsible for all amounts payable under such
Service Contracts accruing after the Proration Date.
(i) PREPAID EXPENSES. Seller shall be credited with an amount
equal to all prepaid costs, expenses, charges and fees attributable to the
period after to the Close of Escrow and described in writing to Buyer at least
thirty (30) days prior the Close of Escrow.
16. BROKERS. Buyer and Seller each represent to the other that except
for Alan W. Viera and Associates, and Third Street Associates and Maynard/Rich
Companies whose collective 1.50% commission shall be paid by Escrow Agent from
Seller's Proceeds at Close of Escrow in accordance with Exhibit "M" Seller
pursuant to a separate written agreement, they have not dealt with any other
real estate broker, agent or person who may be entitled to a commission or fee
on account of this Agreement, and Buyer and Seller each indemnifies and agrees
to defend and hold the other harmless from and against any loss, cost, liability
and expense, including reasonable attorneys' fees, which may be incurred in the
event its representations herein prove incorrect. Seller acknowledges that
Buyer is a licensed real estate Broker acting as a principal in this
transaction.
17. DEFAULT AND REMEDIES.
(a) DEFAULT AND REMEDIES. In the event of a default by Seller
or Buyer the non-defaulting party may, at its option, do any or all of the
following (subject to subparagraph (b) hereinbelow):
(i) terminate this Agreement by written notice delivered
to the other party at or prior to the Closing; and,
(ii) pursue any legal remedy, including an action for
monetary damages.
(b) LIQUIDATED DAMAGES. PRIOR TO ENTERING INTO THIS
TRANSACTION, BUYER AND SELLER HAVE BEEN CONCERNED WITH THE FACT THAT SUBSTANTIAL
DAMAGES WILL BE SUFFERED BY SELLER IN THE EVENT BUYER SHALL FAIL TO PERFORM ITS
OBLIGATIONS UNDER THIS AGREEMENT TO PURCHASE THE PROPERTY. WITH THE FLUCTUATION
IN LAND VALUES, THE UNPREDICTABLE STATE OF THE ECONOMY AND OF GOVERNMENTAL
REGULATIONS, THE FLUCTUATING MONEY MARKET FOR REAL ESTATE LOANS OF ALL TYPES,
AND OTHER FACTORS WHICH DIRECTLY AFFECT THE VALUE AND MARKETABILITY OF THE
PROPERTY, THE PARTIES BELIEVE THAT IT WOULD BE EXTREMELY DIFFICULT AND
IMPRACTICABLE, IF NOT IMPOSSIBLE, TO ASCERTAIN WITH ANY DEGREE OF CERTAINTY THE
AMOUNT OF DAMAGES WHICH WOULD BE SUFFERED BY SELLER IN THE EVENT OF BUYER'S
NONPERFORMANCE OF ITS OBLIGATION UNDER THIS AGREEMENT TO PURCHASE THE PROPERTY
AND CLOSE THE ESCROW. THE PARTIES, HAVING MADE DILIGENT BUT UNSUCCESSFUL
ATTEMPTS TO ASCERTAIN THE ACTUAL COMPENSATORY DAMAGES SELLER WOULD SUFFER IN THE
EVENT OF BUYER'S NONPERFORMANCE OF ITS OBLIGATION TO PURCHASE THE PROPERTY,
HEREBY AGREE THAT THE REASONABLE ESTIMATE OF SAID DAMAGES IS THE AMOUNT OF THE
DEPOSITS ACTUALLY DELIVERED TO ESCROW HOLDER, AND IN THE EVENT OF BUYER'S
FAILURE TO PERFORM ITS OBLIGATION UNDER THIS AGREEMENT TO PURCHASE THE PROPERTY
AND CLOSE THE ESCROW, SO LONG AS SUCH FAILURE IS NOT CAUSED BY SELLER, SELLER
SHALL, AS ITS SOLE REMEDY, BE ENTITLED TO THE AMOUNT OF THE DEPOSITS ACTUALLY
DELIVERED TO ESCROW HOLDER AS LIQUIDATED DAMAGES. SAID AMOUNT HAS BEEN
DETERMINED WITH REFERENCE BY THE PARTIES TO THE ABOVE CONSIDERATIONS IN
ESTABLISHING A REASONABLE SUM AS LIQUIDATED DAMAGES. THE RIGHT TO RECEIVE SUCH
LIQUIDATED DAMAGES SHALL BE SELLER'S SOLE REMEDY IN THE EVENT OF BUYER'S FAILURE
TO PURCHASE THE PROPERTY AND CLOSE ESCROW.
INITIALS: ______ _______
BUYER SELLER
18. CONDEMNATION. If all or any portion of the Property, or any
interest therein, is taken prior to the Closing of Escrow as a result of
condemnation (including the filing of any notice of intended condemnation or
proceedings in the nature of eminent domain), by any entity or government
agency, which is valued at Twenty Five Thousand Dollars ($25,000.00) or more,
then Buyer may, upon written notice to Seller and Escrow Agent, terminate this
Agreement, in which event the parties shall have no further rights or
obligations hereunder. If Buyer does not elect to terminate this Agreement, or
if that portion of the property that is taken as a result of condemnation is
valued at less than Twenty Five Thousand Dollars ($25,000.00), then, Seller
shall assign and turn over, and Buyer shall be entitled to receive and keep, all
awards for the taking of the Property by eminent domain which accrue to Seller
and the parties shall proceed to the Closing pursuant to the terms and
conditions hereof, without modification of the terms of this Agreement and
without any reduction in the Purchase Price.
19. ATTORNEYS' FEES. If it shall be necessary for either Buyer or
Seller to employ an attorney to enforce or defend its rights under this
Agreement, the non-prevailing party shall reimburse the prevailing party for its
actual attorneys' fees and costs of suit.
20. NOTICES. All notices, demands, requests and other communications
required or permitted hereunder shall be in writing and shall be deemed to be
delivered upon actual receipt if personally delivered, one (1) business day
following the transmission of such writing by facsimile with the original sent
by certified or registered mail or the expiration of three (3) days following
its deposit in a regularly maintained receptacle for the United States mail,
registered or certified, return receipt requested, postage fully prepaid,
addressed to the addressee at its address set forth below or at such other
address as such party may have specified theretofore by written notice delivered
in accordance with this Paragraph:
If to Buyer:
Basic Acquisition, Inc.
c/o Richard Dickerson
575 Prospect Blvd.
Pasadena, California 91103
with copies to:
Basic Acquisition, Inc.
2235 Sheppard Avenue East
Atria II, Suite 904
Willowdale, Ontario M2J 5B5
Canada
Steefel, Levitt & Weiss
One Embarcadero Center, 30th Fl.
San Francisco, California 94111
Attn: Clayton B. Gantz, Esq.
If to Seller:
CHICO CROSSROADS CENTER
15 Corporate Plaza, Suite 130
Newport Beach, California 92660
Attn: Robert Flaxman
with a copy to:
Mr. Jamie Sohacheski
8665 Wilshire Blvd., Ste. 200
Beverly Hills, California 90211
with a copy to:
Rodarti, Feld & Gelfer
4675 MacArthur Court, Suite 930
Newport Beach, California 92660
Attn: Richard G. Feld, Esq.
If to Escrow Agent:
Chicago Title
16969 Von Karman
Irvine, California 92714
Attn: Karen Price
Escrow # 6026054-M19
21. GOVERNING LAW. The laws of the State of California shall govern
the validity, enforcement, and interpretation of this Agreement.
22. INTEGRATION; MODIFICATION; WAIVER. This Agreement constitutes the
complete and final expression of the Agreement of the parties relating to the
Property and supersedes all previous contracts, agreements, and understandings
of the Parties, either oral or written, relating to the Property. This
Agreement cannot be modified, or any of the terms hereof waived, except by an
instrument in writing (referring specifically to this Agreement) executed by the
party against whom enforcement of the modification or waiver is sought.
23. COUNTERPART EXECUTION. This Agreement may be executed in several
counterparts, each of which shall be fully effective as an original and all of
which together shall constitute one and the same instrument.
24. HEADINGS; CONSTRUCTIONS. The headings which have been used
throughout this Agreement have been inserted for convenience of reference only
and do not constitute matter to be construed in interpreting this Agreement.
Words of any gender used in this Agreement shall be held and construed to
include any other gender, and words in the singular number shall be held to
include the plural, and vice versa, unless the context requires otherwise. The
words "herein," "hereof," "hereunder" and other similar compounds of the word
"here" when used in this Agreement shall refer to the entire Agreement and not
to any particular provision or section. If the last day of any time period
stated herein shall fall on a Saturday, Sunday or legal holiday, then the
duration of such time period shall be extended so that it shall end on the next
succeeding day which is not a Saturday, Sunday or legal holiday. Unless
otherwise specified, the word "day" shall mean a calendar day.
25. TIME OF THE ESSENCE. Time is of the essence of this Agreement and
of the obligations of the parties to purchase and sell the Property, it being
acknowledged and agreed by and between the parties that any delay in effecting a
Closing pursuant to this Agreement may result in loss or damage to the party in
full compliance with its obligations hereunder. Notwithstanding any period for
performance of any party's obligation as contained in the General Provisions,
the rights of the parties hereunder shall be governed by the dates and times set
forth in this Agreement.
26. OPENING OF ESCROW. Escrow Agent is instructed to notify Buyer and
Seller in writing that it has opened escrow and the date of such notice shall be
the date of opening of Escrow.
27. INVALID PROVISIONS. If any one or more of the provisions of this
Agreement, or the applicability of any such provision to a specific situation,
shall be held invalid or unenforceable, such provision shall be modified to the
minimum extent necessary to make it or its application valid and enforceable,
and the validity and enforceability of all other provisions of this Agreement
and all other applications of any such provision shall not be affected
thereby.
28. BINDING EFFECT. This Agreement shall be binding upon and inure to
the benefit of Seller and Buyer, and their respective successors and assigns.
29. FURTHER ACTS. In addition to the acts recited in this Agreement
to be performed by Seller and Buyer, Seller and Buyer agree to perform or cause
to be performed at the Closing or after the Closing any and all such further
acts as may be reasonably necessary to consummate the transactions contemplated
hereby.
30. EXHIBITS. All attached Exhibits and all items delivered into
Escrow are incorporated herein.
31. SURVIVAL. Except as otherwise provided herein, all covenants
contained herein shall survive the closing of the purchase and sale and shall
not be deemed merged in the Grant Deed, but shall remain in full force and
effect.
32. ASSIGNMENT. Buyer may not assign or transfer any of its rights,
benefits, or privileges hereunder without the prior written consent of Seller,
except that Buyer may assign its right, benefits and privileges hereunder to a
real estate investment trust or similar vehicle advised by Buyer or its
affiliates without the prior consent of Seller provided that any such assignee
assumes in writing all of the Buyer's obligations hereunder. Any such
assignment shall not constitute a novation of Buyer's obligations hereunder.
IN WITNESS WHEREOF, the parties have executed the foregoing Agreement as
of the date and year first-above written.
BUYER:
BASIC ACQUISITION, INC.
a Delaware corporation
By: /c/ RICHARD DICKERSON
-------------------------------------
Its: VICE PRESIDENT
-----------------------------
CHICO CROSSROADS CENTER
a California limited partnership
By: JMLB, INC.,
a California corporation
By: /c/ ILLEGIBLE
------------------------------
Its: PRES
------------------------------