AGREEMENT OF SALE
Five Eves Drive Campus
AGREEMENT OF SALE made this 18 day of April, 1997, between BRANDYWINE
REALTY TRUST, a Maryland Real Estate Investment Trust, its assignee or nominee,
having its principal office at 16 Campus Boulevard, Suite 150, Newtown Square,
Pennsylvania 19073 ("Buyer"), and LAKN Marlton Associates, L.P., a New Jersey
limited partnership having its principal office at 1060 N. Kings Highway, Suite
250, Cherry Hill, New Jersey 08034 ("Seller").
BACKGROUND
The Background of this Agreement is as follows:
A. Seller is the owner of a certain tract of land being comprised of
one (1) parcel of land together with the building and improvements thereon,
including a three (3) story mid-rise office building containing approximately
48,000 net rentable square feet, commonly known as 5 Eves Drive and located in
the Evesham Corporate Center, Marlton, New Jersey as more fully described on
Exhibit A attached hereto; and
B. Seller desires to sell to Buyer and Buyer desires to purchase from
Seller the property referred to in this Agreement, upon the terms and conditions
set forth herein.
TERMS AND CONDITIONS
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, and with the preceding Background paragraphs incorporated by
reference, the parties hereto, intending to be legally bound hereby, covenant
and agrees as follows:
1. PROPERTY BEING SOLD.
Seller shall sell, transfer and convey to Buyer on the Closing Date (as
hereinafter defined),
1.1 Real Property. Fee simple interest in the parcels of land,
all as more fully described on Exhibit "A", being Lot 3, block 2.07, with the
building and improvements thereon, including the three (3) story mid-rise office
building commonly known as 5 Eves Drive, Marlton, New Jersey, and all of the
Seller's right, title, and interest, if any, in any easements, licenses, rights
of way, privileges, hereditaments, appurtenances, and rights to any land lying
in the beds of any street, road or avenue, open or proposed, adjoining thereto,
and inuring to the benefit of said land (hereinafter collectively referred to as
the "Premises"); and
1.2 Personal Property. All of Seller's equipment, fixtures,
machinery and personalty of every description attached to or used in connection
with the Premises (and not owned by tenants under leases of the Premises),
including, without limitation, those listed on the
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Schedule of Inventory attached hereto as Exhibit "B", and to the extent
assignable and in Seller's possession intangible personal property owned by the
Seller and used in connection with the ownership, operation and maintenance of
the Premises, including without limitation, all contract rights, guaranties and
warranties of any nature, all architects', engineers', surveyors' and other real
estate professionals' plans, specifications, certifications, contracts, reports,
data or other technical descriptions, reports or audits (including, without
limitation, all environmental, structural and mechanical inspection reports),
and all marketing materials ("Contract Documents"), all governmental permits,
licenses, certificates, and approvals in connection with the ownership of the
Premises ("Licenses"), all escrow accounts, deposits, instruments, documents of
title pertaining to the Premises, and all of Seller's rights, claims, and causes
of action if any, to the extent they are assignable, under any warranties and/or
guarantees of manufacturers, contractors or installers, including to the extent
applicable, any warranties from any previous owners of the Premises (hereinafter
collectively referred to as "Personal Property"); and
1.3 Leases. All leases, licenses and other occupancy
agreements for any part of the Premises, and except as otherwise set forth
herein, all prepaid rent and unapplied security deposits (the "Leases"); and
1.4 Right to Names. Any and all right, title and interest of
Seller, if any, and without representation or warranty, in and to the name "Five
Eves Drive" and "Evesham Corporate Center", and the Seller's right, if any,
without representation or warranty, to all printing styles, trademarks and logos
(the "Name").
The Premises, Personal Property, Leases and Name are sometimes
hereinafter referred to as "Property."
2. PURCHASE PRICE AND MANNER OF PAYMENT.
2.1 Purchase Price. Buyer shall pay the total sum of Three
Million three Hundred Thousand Dollars ($3,375,000) (hereinafter referred to as
the "Purchase Price") subject to adjustments as set forth herein.
2.2 Manner of Payment. The Purchase Price shall be paid in the
following manner:
2.2.1 Deposit. By delivery, upon Seller's execution
and delivery of this Agreement, of Buyer's good check in the amount of $25,000
to the Title Company (hereinafter referred to as "Escrow Agent" or "Escrowee").
This sum, the sum specified in Section 2.2.2 below, and all other sums paid by
Buyer to the Escrow Agent under this Agreement (hereinafter referred to as the
"Deposit") shall be held by Escrow Agent in a federally-insured, segregated
money market account at an institution to be designated by Buyer until
termination or consummation of this Agreement. Interest on the Deposit shall be
credited to Buyer at Closing, or
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paid to the party otherwise entitled to the Deposit in the event of the
termination of this Agreement prior to Closing.
2.2.2 Additional Deposit. By delivery, within two (2)
business days next following the Inspection Period Expiration Date (as
hereinafter defined), of Buyer's good check in the amount of $25,000.
2.2.3 Balance. The balance of the Purchase Price
shall be delivered to the Seller on the Closing Date, by wire transfer of
immediately available funds, subject to adjustments and apportionments as set
forth in this Agreement.
3. TITLE. On the Closing Date, Seller shall convey to Buyer good and
marketable fee simple title to the Property subject only to those rights of way,
easements, covenants restrictions, and objections to title (hereinafter
"Permitted Exceptions") listed on Exhibit "C" hereto, unless identified by Buyer
as "Title Objections" as hereinafter provided, and subject to the rights of
tenants listed on the rent roll attached hereto as Exhibit "D", which title
shall be insurable at regular rates by Commonwealth Land Title Insurance Company
("Title Company") under an ALTA 1970 Form B (Revised 10/17/70 and 3/30/84) title
insurance policy ("Title Policy").
4. COVENANTS. In addition to the covenants contained in the other
Sections of this Agreement, between the date hereof and Closing, Seller
covenants that it shall:
4.1 Maintenance. At all times prior to the Closing Date,
operate the Property in the same manner as it is currently being operated, and
pay in the normal course of business prior to Closing, all sums due for work,
materials or service furnished or otherwise incurred in the ownership and
operation prior to Closing.
4.2 Alterations. Not make or permit to be made any
alterations, improvements or additions to the Property without the prior written
consent of Buyer, which consent shall not be unreasonably withheld or delayed
except those made by or for tenants pursuant to the right to do so under their
Leases, or by Seller if required by applicable law or ordinance (subject to the
provisions of Section 4.8 of this Agreement), or as required under any Lease.
4.3 Lease. Not enter into any new lease without Buyer's
consent, which consent shall not be unreasonably withheld.
4.4 INTENTIONALLY OMITTED PRIOR TO EXECUTION.
4.5 Bill Tenants. Timely bill all Tenants for all rent
billable under Leases, and use its commercially reasonable efforts consistent
with Seller's existing practices to collect any rent in arrears.
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4.6 Notice to Buyer. Notify Buyer promptly of the occurrence
of any of the following:
(i) a fire or other casualty causing damage to the
Property, or any portion thereof;
(ii) receipt of written notice of eminent domain
proceedings or condemnation of or affecting the Property, or any portion
thereof;
(iii) receipt of written notice from any governmental
authority or insurance underwriter relating to the condition, use or occupancy
of the Property, or any portion thereof, or setting forth any requirements with
respect thereto;
(iv) receipt of written notice of any actual or
threatened litigation against Seller or affecting or relating to the Property,
or any portion thereof;
(v) receipt of written notice of any termination
notice from any tenant;
(vi) the commencement of any strike, lock-out,
boycott or other labor trouble affecting the Property, or any portion thereof.
4.7 INTENTIONALLY OMITTED PRIOR TO EXECUTION.
4.8 Comply with Leases. Perform all material obligations of
the landlord as required by the Leases or by any order or direction of any
governmental authority having jurisdiction thereof, provided that if the cost to
perform such obligation exceeds $25,000.00 (the "Seller Compliance Costs"),
Seller shall have the right to terminate this Agreement if Buyer is unwilling to
pay for the costs of such obligations in excess of the Seller Compliance Costs,
in which event the Deposit shall be returned to Buyer and neither party shall
owe any further obligation hereunder to the other; provided, however, if the
Seller Compliance Costs exceed $25,000, and Buyer agrees to pay for the second
$25,000 of such costs, the additional cost of such Seller Compliance Costs above
$50,000, if any, shall be evenly shared by Buyer and Seller, provided that in no
event shall Seller be obligated to pay more than $50,000 in connection with the
Seller Compliance Costs (e.g., if the total Seller Compliance Costs equal
$70,000 and Buyer agrees to pay for the second $25,000, the additional $20,000
above the $50,000 shall be shared by Buyer and Seller, so that Seller shall be
responsible for $35,000 and Buyer shall be responsible for $35,000). The parties
acknowledge and agree that Buyer is under no obligation to agree to pay for such
Seller Compliance Costs, but that the aforesaid cost allocation mechanism is an
agreed upon compromise in order to permit Buyer to avoid Seller's termination of
this Agreement.
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4.9 No New Agreements. Except for agreements which can be
terminated on not more than thirty (30) days' notice, not enter into any other
agreements which affect the Property or the transactions contemplated by this
Agreement, without the prior written consent of Buyer which consent shall not be
unreasonably withheld or delayed; and except for the Permitted Exceptions, not
permit the creation of any liability which shall bind Buyer or the Premises
after Closing.
4.10 Tax Disputes. Notify Buyer of any tax assessment disputes
(pending or threatened) with respect to the Property prior to Closing, and not
agree to any changes in the real estate tax assessment, nor settle, withdraw or
otherwise compromise any pending claims with respect to prior tax assessments,
without Buyer's prior written consent. If any proceedings shall result in any
reduction of assessment and/or tax for the tax year in which the Closing occurs,
it is agreed that the amount of tax savings or refund for such tax year, less
the reasonable fees and disbursements in connection with such proceedings, shall
be apportioned between the parties as of the date real estate taxes are
apportioned under this Agreement. Any reduction relating to tax years prior to
the year in which the Closing occurs shall be payable to the Seller.
4.11 No Removal of Personalty. Not remove any non-consumable
Personal Property from the Premises without replacing it with similar personal
property, new or of equal or better quality.
5. REPRESENTATIONS AND WARRANTIES. In order to induce Buyer to enter
into this Agreement, Seller hereby represents and warrants to Buyer that to the
best of the Seller's actual knowledge (which shall be deemed to mean the actual
knowledge of Howard E. Needleman) the following representations and warranties
are true now, and where the representation specifically provides, will be true
at Closing:
5.1 Seller's Authority For Binding Agreement. Seller is a duly
authorized and validly existing limited liability company formed under the laws
of State of New Jersey. Seller has full power, right and authority to own its
properties, to carry on its business as now conducted, and to enter into and
fulfill its obligations under this Agreement. Each of the persons executing this
Agreement on behalf of Seller is authorized to do so. This Agreement is the
valid and legally binding obligation of Seller, enforceable against Seller in
accordance with its terms. The execution and delivery of this Agreement and
compliance with its terms will not conflict with or result in the breach of any
law, judgement, order, writ, injunction, decree, rule or regulation, or conflict
with or result in the breach of any other agreement, document or instrument to
which Seller is a party or by which it or the Property is bound or affected. The
representation contained in this Section 5.1 shall be true at and as of Closing.
5.2 Employment on "At-Will" Basis. There are no employees of
Seller and Buyer assumes no obligations or responsibilities whatsoever for any
employees of Seller. The representation contained in this Section 5.2 shall be
true at and as of Closing.
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5.3 Service Contracts. Exhibit "E" attached hereto is a
complete list of all existing service, equipment, supply and maintenance
contracts with respect to or affecting the Property (the "Service Contracts").
Seller has received no written notice of default or breach by Seller in the
terms of any of such Service Contracts. To the Seller's actual knowledge, Seller
has performed, and at Closing shall have performed, all obligations which it has
under said Service Contracts.
Anything in this Section 5.3 to the contrary notwithstanding, Seller
represents and warrants that any existing management agreements and exclusive
brokerage or leasing agreements shall be terminated as of Closing, Seller having
fully paid and discharged any and all obligations accruing thereunder, and Buyer
shall assume no liability under or in respect of any such agreements.
5.4 Condemnation. Seller has received no written notice of any
pending condemnation or eminent domain proceeding pending with regard to any
part of the Property.
5.5 No Lawsuits. Seller has received no written notice of any
claims, lawsuits or proceedings pending, or to the best of the Seller's
knowledge, threatened against or relating to Seller or the Property, or which
could affect them, or either of them, in any court or before any governmental
agency, except for actions for possession, damages and or rent, if any, against
defaulted tenants as disclosed in Exhibit "D", or except for actions which are
adequately covered or defended by an insurance carrier. The representation
contained in this Section 5.5 shall be true at and as of Closing.
5.6 No Tax Assessments. Seller has received no written notice
of any public improvements in the nature of off-site improvements, or otherwise,
which have been ordered to be made and/or which have not heretofore been
assessed, and, to Seller's knowledge, there are no special or general
assessments currently affecting or pending against the Property, except as set
forth in the Title Binder.
5.7 Leases. There are no oral or written leases or rights of
occupancy or grants or claims of right, title or interest in any portion of the
Premises other than the leases (the "Leases") listed on the rent roll attached
hereto as Exhibit "D". Exhibit "D" identifies (i) each tenant of the Premises,
(ii) the date of that tenant's lease, (iii) the expiration date of that tenant's
lease, (iv) the annual and monthly minimum rental charge, the tenant's share of
building operating costs (including, without limitation, taxes) and any and all
costs, expenses and other charges payable by the tenant under the Lease, (v)
arrearages, if any, and whether the latest rent due has been paid, (vi) the
amount of prepaid rent, if any, (vii) the amount or description of any
concessions, allowances, rebates, refunds, escrow or security deposits made by
the tenant under said tenant's Lease; (viii) any options to renew, extend,
purchase, cancel or terminate; (ix) all unpaid tenant improvement allowances
and/or unpaid leasing commissions; and (x) any outstanding written notices of
defaults of any kind or nature whatsoever. Seller has the sole right
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to collect rents under the Leases, and neither such right nor any of the Leases
has been assigned, pledged, hypothecated or otherwise encumbered by Seller
except as additional collateral for the existing mortgage upon the Premises
which shall be satisfied at or before Closing. To the best of Seller's
knowledge, each of the Leases is valid and subsisting and in full force and
effect, the tenant is in actual possession in the normal course, and the rents
set forth in Exhibit "D" are the actual rents, income and charges being
collected by Seller under the Leases. Any tenant improvements which Seller is
obligated to complete pursuant to any Lease has been completed as of this date
or shall be completed as of Closing, and all costs for completed work has been
or shall be paid by Seller. The amount of each security deposit contains, where
required by law or otherwise applicable, interest which has accrued in
accordance with law. Except as set forth on Exhibit "D", no tenant of the
Premises under any of the Leases has, and shall not at Closing have, prepaid any
rent under any of the Leases for more than one (1) month. Except as otherwise
set forth on Exhibit "D", no security deposits by tenants have heretofore been
returned or applied to charges against the tenants.
5.8 Compliance with Law.
(i) To the best of Seller's actual knowledge, there
are no outstanding notices of any violations issued by governmental authority
having jurisdiction over the Property.
(ii) To the best of Seller's actual knowledge, which
knowledge is based exclusively upon that certain Environmental Report prepared
by _____________ dated ___________ __, 19__ (the "Environmental Report") and
except as otherwise set forth in the Environmental Report, no Hazardous
Substances (defined below) and no Hazardous Wastes (defined below) are present
on the Property including, without limitation, asbestos, flammable substances,
explosives, radioactive materials, hazardous wastes, toxic substances,
pollutants, pollution, contaminant, polychlorinated byphenyls ("PCBs"), urea
formaldehyde foam insulation, radon, corrosive, irritant, biologically
infectious materials, petroleum product, garbage, refuse, sludge, hazardous or
waste materials, except to the extent such substance or materials are used in
the ordinary course of the Seller's business or that of any Tenant in accordance
with applicable laws, and there has, to the best of Seller's knowledge, and
based exclusively upon the Environmental Report, been no use of the Property
that may, under any federal, state or local environmental statute, ordinance or
regulation, require, at any time, any closure or cessation of the use or
occupancy of the Property and/or impose, at any time, upon the owner of the
Premises any clean-up or other monetary obligation. Seller has received no
written notice that it has been identified in any litigation, administrative
proceeding or investigation as a responsible party or potentially responsible
party for any liability for clean-up costs, natural resource damages or other
damages or liability for prior disposal or release of Hazardous Substances,
Hazardous Wastes or other environmental pollutants or contaminants, and no lien
or superlien has been recorded, filed or otherwise asserted against any real or
personal property of Seller for any clean-up costs or other responses costs
incurred in connection with any environmental contamination that is
attributable, in whole or in part, to Seller. For purposes of this Agreement,
"Hazardous Substances" means those elements and compounds which are designated
as such in Section
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101(14) of the Comprehensive Response, Compensation and Liability Act (CERCLA),
42 U.S.C. Section 9601 (14), as amended, all petroleum products and by-products,
and any other hazardous substances as that term may be further defined in all
applicable federal, state and local laws including the New Jersey Industrial
Site Recovery Act, as amended ("ISRA"); and "Hazardous Wastes" means any
hazardous waste, residential or household waste, solid waste, or other waste as
defined in applicable federal, state and local laws. Seller has not received any
written summons, citation, directive, letter or other communication, written or
oral, from any governmental or quasi-governmental authority concerning any
intentional or unintentional action or omission on Seller's part which (a)
resulted in the releasing, spilling, leaking, pumping, pouring, emitting,
emptying or dumping of Hazardous Substances or Hazardous Wastes, or (b) related
in any way to the generation, storage, transport, treatment or disposal of
Hazardous Substances or Hazardous Wastes. The representation contained in this
Section 5.8(i) shall be true and correct at and as of Closing.
5.9 Insurance. Exhibit "F" attached hereto contains a true and
correct description of all insurance policies affecting the Property and the
operation thereof. All of said insurance policies shall remain in full force and
effect until the completion of Closing hereunder. Seller has not received any
written notice from any insurance company board of fire underwriters or rating
organization (or other body exercising similar functions) (i) claiming any
defects or deficiencies which have not been addressed and fully cured or
corrected, or (ii) requesting the performance of any repairs, alterations or
other work which have not been performed, or (iii) claiming any default which,
if not corrected, would result in a cancellation of insurance coverage. The
representation contained in this Section 5.9 shall be true at and as of Closing.
5.10 INTENTIONALLY OMITTED PRIOR TO EXECUTION.
5.11 No Brokers. Except as set forth on Exhibit "D", no
brokerage or leasing commission or other compensation is now, or will at Closing
be, due or payable to any person, firm, corporation, or other entity with
respect to or on account of any of the Leases, or any extensions or renewals
thereof.
5.12 INTENTIONALLY OMITTED PRIOR TO EXECUTION.
5.13 INTENTIONALLY OMITTED PRIOR TO EXECUTION.
5.14 Good Title to Property. Seller holds good and marketable,
indefeasible fee simple title to the Property, free and clear of liens and
encumbrances, other than the Permitted Exceptions. The representation contained
in this Section 5.14 shall be true at and as of Closing.
5.15 All Taxes and Assessments Paid. Seller will have paid
prior to Closing, all taxes and assessments, including assessments payable in
installments, which are to become due and payable prior to Closing and/or a lien
on the Property, except for taxes for the current year which shall be prorated
at Closing or installments of current assessments which become due and
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payable after Closing, which shall be the sole responsibility of the Buyer. The
representation contained in this Section 5.15 shall be true at and as of
Closing.
5.16 FIRPTA. Seller is not a "foreign person" as such term is
defined in Section 1445(f)(3) of the Internal Revenue Code of 1954, as amended
(the "Code"). The representation contained in this Section 5.16 shall be true at
and as of Closing.
5.17 INTENTIONALLY OMITTED PRIOR TO EXECUTION.
5.18 INTENTIONALLY OMITTED PRIOR TO EXECUTION.
5.19 Inventory Schedule. The Schedule of Inventory contains a
correct and complete list of personal property owned by Seller and located at or
used in connection with the operation of the Property.
5.20 Charges, Fees and Assessments. Any and all applicable
charges, fees and assessments pending as of the date of this Agreement and any
and all other sums due under declarations, cross-easements and like agreements
to which the Property or any portion thereof may be subject, have been paid, and
no special assessments thereunder are pending, and all consents and approvals
required to be obtained under any such declarations, cross-easements and like
agreements have been obtained pursuant to the requirements of such
documentation. The representation contained in this Section 5.20 shall be true
at and as of Closing.
5.21 Rights to Purchase. There are no outstanding agreements,
options, rights of first refusal, conditional sales agreements or other
agreements or arrangements, whether oral or written, regarding the purchase and
sale of the Property, or which otherwise affect any portion of or all the
Property. The representation contained in this Section 5.21 shall be true at and
as of Closing.
5.22 INTENTIONALLY OMITTED PRIOR TO EXECUTION.
5.23 INTENTIONALLY OMITTED PRIOR TO EXECUTION.
5.24 INTENTIONALLY OMITTED PRIOR TO EXECUTION.
5.25 Development Agreements. Seller is in material compliance
with and has fully paid and discharged all obligations arising under any and all
development, tri-party and like agreements, and any and all other agreements
with county, municipal and other governmental and quasi-governmental agencies
and authorities respecting the ownership, development and operation of the
Property and all portions thereof. The representation contained herein shall be
true at and as of Closing.
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5.26 Correct Copies of Documents. Where copies of any
documents have been delivered by Seller to Buyer, whether prior to or pursuant
to this Agreement, such copies: (i) are exact copies of the originals of said
documents, as executed and delivered by all of the parties thereto; (ii) to the
best of Seller's knowledge, constitute, in each case, the entire agreement
between the parties thereto with respect to the subject matter thereof, and the
original instruments in the form delivered to Buyer, are now in full force and
effect, and valid and enforceable in accordance with their respective terms, and
no party thereto is in default, and no claim of default by any party has been
made or is now pending and there does not now exist any default which, after
either the giving of notice or the passing of time, or both, will or may
constitute a default, or would excuse performance by any party thereto; and
(iii) have not been changed or amended except for amendments, if any,
specifically referred to therein.
6. POSSESSION. Possession of the Premises is to be given to Buyer,
subject to the right of tenants under the Leases on the Closing Date, by
delivery of the Deed, and all keys, combinations and security codes at Closing.
7. BUYER'S REVIEW AND APPROVAL OF TITLE AND SURVEY.
7.1 Title Binder. On or before the execution of this
Agreement, Seller shall have made available to Buyer, without representation or
warranty, Seller's most recently dated title commitment for the Property
(complete with copies of all exceptions to title), and Buyer shall order a
current title commitment (the "Title Binder") from the Title Company. Buyer
shall promptly deliver to the Buyer a copy of the Title Binder, together with a
notice of any items disclosed on the Title Binder which is not a Permitted
Exception (a "Title Objection"). If prior to Closing, the Seller can not remove
the Title Objection, the Seller shall have the option of accepting the title to
the Property subject to the Title Objection or of terminating this Agreement, in
which event the Deposit shall be returned to the Buyer and neither party shall
owe any further obligation hereunder to the other. Notwithstanding the
foregoing, at Closing, Seller, so long as such amount does not exceed
$500,000.00 (exclusive of the mortgages currently encumbering the Property),
shall pay all monetary liens, which are not Permitted Exceptions.
7.2 Survey. Seller shall make available to Buyer, if within
Seller's possession, without representation or warranty, within three (3) days
of the date hereof, Seller's most recent survey of Property (the "Survey"),
7.3 Physical and Financial Inspection. For a period (the
"Inspection Period") commencing on the second (2nd) business day next following
the date upon which Buyer shall receive from Seller a fully-executed counterpart
of this Agreement, and expiring on April 15, 1997 (such date is herein referred
to as the "Inspection Period Expiration Date"), Buyer shall have the right to
have performed a physical and mechanical inspection, measurement and audit of
the Property and an inspection of all books and records and financial
information pertaining thereto, and Seller shall cooperate with Buyer and shall
make available to Buyer such information, materials and documents as Buyer may
reasonably request and shall have its accountant available
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throughout such period to assist in Buyer's inspection and review. The
inspection, audit and measurement of the Property's operation, condition and
maintenance shall include, without limitation, such environmental and
engineering inspections, reviews and assessments that Buyer deems appropriate.
If Buyer, at Buyer's sole and absolute discretion, shall find such inspection(s)
to be unsatisfactory for any reason whatsoever, Buyer shall have the right, at
its option, to terminate this Agreement on or before the Inspection Period
Expiration Date, and upon such termination, the Deposit shall be immediately
refunded to the Buyer, and thereupon the parties hereto shall have no further
liabilities one to the other with respect to the subject matter of this
Agreement. Buyer agrees that it shall not unreasonably interfere with tenants in
performing its inspection. If Buyer or its consultants exercises its rights
under the provisions of this subsection, it shall (i) provide Seller with prior
verbal notice of Buyer's entry, (ii) keep the Property free of any liens or
third-party claims resulting therefrom except as may be required by applicable
law; (iii) maintain adequate liability insurance in an amount of not less than
$1,000,000.00 for a single occurrence and $50,000.00 for property damage which
insurance shall name Seller as an additional insured; (iv) indemnify Seller
against any liability or expense for injuries to or death of persons or damage
to property arising from the exercise of the rights hereunder that are not the
result of any act or omission of Seller or Seller's agents, employees or
contractors and (v) if Closing does not occur for any reason restore as nearly
as practicable the Property substantially to its condition immediately before
such exercise. The indemnification and restoration provisions of this subsection
shall survive the termination of this Agreement. In connection with such
inspection, Seller shall make available at the Property, or at the Seller's
management offices, without representation, or warranty, except as specifically
set forth herein, and to the extent the same are in the Seller's possession, the
following:
7.3.1 Leases. All Leases for the Property as of the
date hereof;
7.3.2 Contracts, and Licenses. Copies of the Contract
Documents, the Licenses, any certificates of occupancy, insurance policies
applicable to the Property and any other documents evidencing rights described
in Section 1.2 hereof;
7.3.3 Tax Bills. A copy of tax bills (i) for the
current year, and (ii) if available, for the preceding two years;
7.3.4 Operating Statements. Statements of operation
of the Property for the past year;
7.3.5 Notices of Violations. Copies of any
uncorrected written notices of violations of any law, ordinance, regulation,
rule or requirement of any governmental body having jurisdiction;
7.3.6 Takings or Changes. Copies of all written
notices to Seller of proposed or threatened takings or changes with respect to
the Property;
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7.3.7 Tax Assessments, Appeals and Increases. Copies
of all written notices to Seller of all filed, proposed or threatened tax
assessment appeals or tax assessment increases related to the Premises;
7.3.8 Litigation. Copies of all pending and written
notices to Seller of threatened litigation, including litigation involving
tenants, affecting the Property or this transaction;
8. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. The
representations and warranties of Buyer shall survive Closing and delivery of
the Deed for the statute of limitations pertaining thereto. The representations
and warranties of Seller set forth in Sections 5.1, 5.2, 5.6, 5.8 (i), 5.11,
5.16, and 5.21 shall survive Closing and delivery of the Deed for the applicable
period of the statute of limitations pertaining thereto. The representation and
warranties of Seller set forth in Sections 5.3, 5.5, 5.8(ii), 5.19, 5.20, 5.25,
and 5.26 shall survive Closing and delivery of the Deed for six (6) months from
Closing. The representations and warranties of Seller set forth in Section 5.7
shall survive Closing and delivery of the Deed for three (3) months from
Closing. The remaining representations and warranties shall not survive Closing
and delivery of the Deed. Notwithstanding anything contained in this Agreement
to the contrary, except as expressly set forth in this Agreement, Seller makes
no representation, either prior to or at the Closing, with respect to the
condition or character of the Property or the use or uses to which the Property
may be put. Buyer acknowledges that Buyer has or will carefully and thoroughly
examine, inspect and investigate the Property, and the Seller's operations (as
to manner, income and expenses), and Buyer is or will be fully satisfied with
the same upon completion of the inspections and examinations; and Buyer is
purchasing the same on the basis of such examination, inspection and
investigation and not in reliance on any representation or warranty of Seller or
any agent, employee or representative of Seller of any kind or nature whatsoever
except as specifically set forth herein. Accordingly, Buyer hereby agrees to
accept all of the assets being acquired by Buyer hereunder, whether realty,
personalty or mixed, on an absolutely and unconditionally "as is" basis at the
time of Closing. Notwithstanding the time period for survival with respect to
Section 5.7, if prior to the expiration of such period, Seller delivers to Buyer
an estoppel certificate on Buyer's prescribed form, which certificate confirms
Seller's representations under Section 5.7 of this Agreement, Seller shall be
released from all liability with respect to its representations as they pertain
to such tenancy.
9. FIRE OR OTHER CASUALTY.
9.1 Maintain Insurance. Seller shall maintain in effect until
the Closing Date the insurance policies (or like policies) now in effect with
respect to the Premises and Personal Property as set forth in Exhibit F".
9.2 Minimal Damage. If prior to the Closing Date any portion
of the Property is damaged or destroyed by fire or other casualty, and the cost
of repair or restoration thereof
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shall be $250,000 or less (as established by good faith estimates obtained by
Buyer), this Agreement shall remain in force.
9.3 Substantial Damage. If prior to the Closing Date any
portion of the Property is damaged or destroyed by fire or other casualty, and
the cost of repair or restoration thereof shall be more than $250,000 (as
established by good faith estimates obtained by Buyer), Buyer may terminate this
Agreement by giving written notice thereof to Seller ("Buyer's Notice of
Election"), and if this Agreement is so terminated, then the Deposit shall be
immediately refunded to Buyer, and thereafter neither party shall have any
further liability hereunder thereafter. If Buyer does not so terminate this
Agreement, it shall remain in full force and effect, and the provisions of
Section 9.4 below shall apply.
9.4 Closing After Substantial Damage. So long as this
Agreement shall remain in force under Section 9.2 or 9.3, then (i) all proceeds
of insurance collected prior to Closing, plus the amount of deductible under
Seller's insurance policy, shall be adjusted subject to Buyer's approval and
participation in any adjustment, and shall be credited to Buyer against the
Purchase Price payable by Buyer at Closing, and (ii) all unpaid claims and
rights in connection with losses shall be assigned to Buyer at Closing.
9.5 Rent Insurance. All rental loss insurance and the proceeds
thereof allocable to any period subsequent to Closing shall be paid or assigned
to Buyer at Closing.
10. CONDEMNATION. If, prior to the Closing Date, all or any material
portion of the Premises (being any taking affecting the building or any other
taking involving 10% or more of the Premises or the parking area) is taken by
eminent domain or a notice of any eminent domain proceedings with respect to the
Premises or any part thereof is received by the Seller, then Seller shall within
five (5) days thereafter give notice thereof to Buyer and Buyer shall have the
option to (a) complete the purchase hereunder or (b) if such taking, in Buyer's
sole and absolute discretion, adversely affects the Premises or its current
economic viability, terminate this Agreement, in which event the Deposit shall
be immediately refunded to Buyer, and this Agreement shall be null and void.
Buyer shall deliver written notice of its election to the Seller within two (2)
days after the date upon which the Buyer receives written notice of such eminent
domain proceedings. If notice of condemnation is received by Buyer and it fails
to deliver said written notice of its election within said time period, such
failure shall constitute a waiver by Buyer of its right to terminate this
Agreement. If this Agreement is not so terminated, Buyer shall be entitled to
all awards or damages by reason of any exercise of the power of eminent domain
or condemnation with respect to or for the taking of the Premises or any portion
thereof, and until such time as closing has occurred, or this Agreement
terminates. Any negotiation for, or agreement to, and all contests of any offers
and awards relating to eminent domain proceedings shall be conducted with the
joint approval and consent of the Seller and the Buyer.
11. Expense Allocations.
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11.1 Seller shall pay for all applicable realty transfer taxes
related to the execution, delivery and recording of the Deed, Bill of Sale, and
other Closing Documents, and all related recording charges.
11.2 Subject to Section 13.3, Buyer shall pay for Buyer's
title examination for Buyer's title examination and premiums and for Buyer's due
diligence expenses, including survey, structural analysis and environmental
analysis.
11.3 Buyer and Seller shall be responsible for paying their
own attorney's fees in connection with this transaction.
12. CLOSING.
12.1 Time and Date and Place. The Closing on the sale of the
Property (herein referred to as the "Closing") shall take place on April 18,
1997, at the offices of Pepper, Hamilton & Scheetz LLP, Suite 500, 457
Haddonfield Road, Cherry Hill, New Jersey. Time is of the essence.
12.2 Documents. At Closing, the parties indicated shall
simultaneously execute and deliver the following:
12.2.1 Seller's Documents and Other Items. Seller
shall execute and deliver or cause to be executed and delivered to Buyer in
proper form for recording:
12.2.1.1 Deed. A bargain and sale deed with
covenants against grantor's acts prepared by Buyer's counsel in form acceptable
to Seller (the "Deed"), conveying the Premises to Buyer, duly executed by Seller
for recording. The Deed description shall be based upon the metes and bounds
description attached as Exhibit "A",; in addition, if Buyer requests that Seller
convey the Premises by the metes and bounds description shown on the new survey,
if any, obtained by Buyer, Seller covenants to execute a Quit Claim Deed for
such new description.
12.2.1.2 Bill of Sale. A bill of sale
prepared by Buyer's counsel in form acceptable to Seller, assigning, conveying
and transferring to Buyer, all of the Personal Property, without representation
or warranty.
12.2.1.3 Original Leases. All original
Leases, tenant files, tenant correspondence and repair records.
12.2.1.4 Original Licenses, Contract
Documents and Other Personal Property. All original Licenses, Contract
Documents, and other Personal Property described in Section 1.2 of this
Agreement, to the extent same are in the Seller's possession.
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12.2.1.5 Assignment of Leases. An assignment
and assumption agreement with reciprocal indemnities, prepared by Buyer's
counsel in form acceptable to Seller (the "Assignment"), duly executed by Seller
and Buyer, assigning, conveying and transferring to Buyer the Leases.
12.2.1.6 Assignment of Licenses, Contract
Documents and Other Personal Property. An assignment agreement prepared by
Buyer's counsel, in form acceptable to Seller, assigning, conveying and
transferring to Buyer, to the extent the same are assignable the Licenses,
Contracts Documents and Other Personal Property, including, specifically, the
Names, without representation or warranty.
12.2.1.7 FIRPTA Certificates. All
certificate(s) required under Section 1445 of the Code.
12.2.1.8 Tenant Letter. Letters to each
tenant advising of the change in ownership and directing the payment of rent to
such party as the Buyer shall designate, said letter to be in form acceptable to
Buyer.
12.2.1.9 Estoppel Certificates. An Estoppel
Certificate in the form delivered to Seller and attached hereto as Exhibit
12.2.1.9, dated within ten (10) days of the Closing Date from McKay Corporation
and ADP Financial, Inc.
12.2.1.10 Title Insurance Certificates. Such
affidavits of title or other certifications as shall be required by the Title
Company to insure Buyer's title to the Premises as set forth in Section 3, and
to provide affirmative endorsements (a) against construction liens, (b) and
parties in possession other than tenants under the Leases.
12.2.1.11 Updated Rent Roll. An updated
schedule of Tenant Leases, containing all information required to be set forth
in Exhibit "D", which schedule is correct and complete as of the date of
Closing.
12.2.1.12 Seller Certificate. A written
certification confirming that as of Closing the representations and warranties
which are required to be true at and as of Closing, are true at and as of
Closing.
12.2.1.13 Organization Certifications.
Confirmation of the good standing and existence of Seller and the due authority
of those executing for them, including, without limitation, the following
documents issued no earlier than 30 days prior to Closing: (a) good standing
certificate in state of organization and in the State in which the Property is
located, and (b) partnership agreement.
12.2.1.14 Keys. All keys, combinations and
security codes for all locks and security devices on the Property;
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12.2.1.15 INTENTIONALLY OMITTED PRIOR TO
EXECUTION.
12.2.1.16 INTENTIONALLY OMITTED PRIOR TO
EXECUTION.
12.2.1.17 ISRA Non-Applicability Letter. A
written non- applicability letter issued within 30 days prior to Closing by the
New Jersey Department of Environmental Protection stating that the transaction
and the Property is not subject to ISRA.
12.2.2 Buyer's Documents. Buyer shall deliver or
cause to be delivered to Seller:
12.2.2.1 The amounts required to be paid to
Seller pursuant to this Agreement;
12.2.2.2 Confirmation of the existence and
subsistence of Buyer, and the authority of those executing for Buyer, including,
without limitation, the following documents issued no earlier than thirty (30)
days prior to Closing: (a) good standing certificate in State of Maryland, (b)
Buyer's Amendment and Restatement of Declaration of Trust filed on August 27,
1996, as amended, (c) a certificate from any officer of Buyer confirming the
incumbency of the signatories and the current force and effect of the resolution
authorizing their execution of the documents required under this Agreement.
12.2.3 Title Insurance. As a condition to Buyer's
obligations at Closing, Title Company shall furnish Buyer at Closing with the
Title Policy, in the form approved by Buyer pursuant to Section 3, in the full
amount of the Purchase Price, wherein the Title Company shall insure fee simple
title to the Property in Buyer or its designee as of the Closing Date containing
no exceptions to title other than the Permitted Exceptions and those which have
been approved by Buyer pursuant to the provisions of this Agreement and
providing the title endorsements specified in Section 12.2.1.10 above.
12.2.4 Necessary Documents. Buyer and Seller shall
execute and deliver such other documents and instruments as may be reasonably
necessary to complete the transaction contemplated by this Agreement.
13. DEFAULT; REMEDIES
13.1 Prior to title passing and the completion of
Closing, in the event of Seller's default hereunder, Buyer's sole remedies shall
be that of (i) specific performance without abatement of the Purchase Price or
(ii) termination of this Agreement and return of the Deposit. In no event shall
Buyer be entitled to damages of any kind or nature;
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13.2 Prior to title passing and completion of
Closing, with respect to any representations or warranties of Seller contained
in this Agreement, Buyer's obligations hereunder are contingent upon such
representations and/or warranties contained in this Agreement being true and
correct as of the date hereof and where the context indicates, as of the date of
Closing, but recision of this Agreement and return of the Deposit, shall be
Buyer's exclusive remedy for any breach of any representation and/or warranty by
Seller.
13.3 Notwithstanding the foregoing, in the event of a
willful or intentional breach of a covenant, obligation or warranty by Seller
under this Agreement or if Seller makes a willful or intentional material
misrepresentation in this Agreement, Buyer shall be entitled to terminate this
Agreement and to the return of the Deposit and Buyer's reasonably documented
Transaction Costs sustained by Buyer in connection with this Agreement; and the
foregoing shall be Buyer's sole remedies under this subparagraph.
13.4 Subsequent to title passing and completion of
Closing, Buyer shall have recourse against Seller for its reasonably documented
actual damages, sustained solely for Seller's breach of representations and
warranties which survive Closing, which breach is discovered by Buyer after
Closing; the right to pursue said recourse shall expire and terminate, as to any
right on which action has not then been initiated, at the expiration of the
survival periods set forth herein.
13.5 Buyer recognizes that the Property will be
removed by Seller from the market during the existence of this Agreement and
that if this purchase and sale is not consummated because of Buyer's default
Seller shall be entitled to compensation for such detriment. Seller and Buyer
acknowledge that it is extremely difficult and impracticable ascertain the
extent of the detriment, and to avoid this problem, Seller and Buyer agree that
if the purchase and sale contemplated in this Agreement is not consummated
because of Buyer's default under this Agreement, Seller shall be entitled to
retain the Deposit (whether or not same has theretofore been paid) as its sole
and liquidated damages. The parties agree that the sum stated above as
liquidated damages shall be in lieu of any other relief to which Seller might
otherwise be entitled, Seller hereby specifically waiving any and all rights
which it may have to damages or specific performance as a result of Buyer's
default under this Agreement.
13.6 Buyer's Out-of-Pocket Costs. In the event of
Seller's breach or default in accordance with Section 13.3 then, in any such
event, upon termination by Buyer hereunder, in addition to receiving the
immediate return of the Deposit, anything in the Agreement contained to the
contrary notwithstanding, Buyer shall also receive from Seller, upon demand,
Buyer's actual, documented out-of-pocket costs and expenses associated with this
Agreement and Buyer's anticipated acquisition of the Property including, without
limitation, Buyer's reasonable counsel fees and costs, title expenses, survey
costs, financial and accounting due diligence, Buyer's structural inspection of
the Property and Buyer's environmental assessment of the Property, and other
costs and expenses associated with Buyer's due diligence, (collectively,
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"Transaction Costs"). The foregoing list is not intended to be exclusive, but
representative of the costs and expenses that the parties anticipate that Buyer
will incur in anticipation of this transaction. Seller's maximum reimbursement
liability under this Section 13 shall not exceed $15,000.
14. CONDITIONS PRECEDENT TO CLOSING.
The obligations of Buyer hereunder are subject to the
fulfillment of the following conditions prior to or on the Closing Date (any one
of which may be waived in whole or in part by Buyer at or prior to the Closing)
and in the event any of the conditions are not complied with, Buyer may
terminate this Agreement by notifying the Seller and Escrow Agent and thereupon
shall be returned the Deposit and thereafter this Agreement shall be null and
void:
14.1 Correctness of Warranties and Representations. The
warranties and representations made by Seller which specifically are required to
be true and correct at and as of Closing shall be true and correct on the
Closing Date in all material respects as though such representations and
warranties were made on the Closing Date except that (i) variations which occur
in the ordinary course of Seller's business, (ii) variations disclosed in
writing to Buyer prior to Closing, or (iii) any matter or occurrence discovered
by the Buyer prior to Closing shall not be construed as a failure of the
condition set forth in this Section 14.1.
14.2 Compliance with Terms and Conditions. Seller shall have
performed and complied in all respects with all of the terms and conditions
required by this Agreement to be performed and complied with by it prior to or
on the Closing Date, including delivery of all of the Seller Documents.
14.3 No Willful Default. There shall have been no willful or
intentional breach of a covenant, representation or obligation by the sellers
under either of the Agreements of Sale listed on Exhibit "G" (the "Greentree
Agreements") attached hereto and made a part hereof, which willful or
intentional breach results in the termination of either or both of the Greentree
Agreements, provided that in such event, the Buyer's remedy hereunder, shall be
expressly limited to recision of this Agreement and a return of the Deposit.
15. PRORATIONS.
15.1 Operating Expenses. The following items shall be prorated
at Closing, as of close of business of the day immediately preceding Closing
"Adjustment Date":
15.1.1 Rents. All current collected rent, additional
rent, percentage rent (if any) and all other charges collected under the Leases
shall be apportioned on the Closing Date pro rata on a per diem basis. If any
tenant is in arrears in the payment of rent or additional rent on
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the Closing Date, rents received from such tenant ninety (90) days after the
Closing Date shall be applied in the following order of priority: (a) to the
Buyer, so long as such tenant is in arrears for current or prior rent arising
after Closing, then (b) to Seller for all rent in arrears prior to the Closing
Date; and then (c) to Buyer with no further claim by Seller thereto. Except as
herein provided, Buyer is not under any obligation to collect rents in arrears
for the benefit of Seller. Any rents which are delinquent or otherwise not paid
at the time of Closing, and collected by Buyer within ninety (90) days after
Closing shall be apportioned as aforesaid and the portion to which Seller is
entitled shall be promptly remitted by Buyer to Seller. Seller shall have no
claim to rents collected ninety (90) days after the Closing Date.
15.1.2 Taxes. Real estate and personal property
taxes, if any, on the basis of the fiscal year for which assessed. If the
Closing shall occur before the tax rate or assessment is fixed, the
apportionment of such real estate and personal property taxes at the Closing
shall be upon the basis of the tax rate for the next preceding year applied to
the latest assessed valuation. Final adjustment will be made upon the actual tax
amount, when determined.
15.1.3 Deposits. Tax and utility company deposits, if
any.
15.1.4 Water and Sewer Charges. Water and sewer
charges and fire protection and inspection services based upon meter readings to
be obtained by Seller effective as of the Adjustment Date, or if not so
obtainable, a date not more than ten (10) days prior to the Adjustment Date, and
the unfixed meter charges based thereon for the intervening period shall be
apportioned on the basis of such last reading. Upon the taking of a subsequent
actual reading, such apportionment shall be readjusted and Seller or Buyer, as
the case may be, will promptly deliver to the other the amount determined to be
so due upon such readjustment. If Seller is unable to furnish such prior
reading, any reading subsequent to the Closing will be apportioned on a per diem
basis from the date of such reading immediately prior thereto and Seller shall
pay the proportionate charges due up to the date of Closing.
15.1.5 Assigned Contracts. Amounts paid or payable in
respect of any service and maintenance contracts assigned to Buyer in accordance
herewith.
15.1.6 Electricity, gas, steam and fuel. Electricity,
gas and steam and fuel oil, if any, based on meter readings or a fuel company
letter showing measurement on the day immediately preceding Closing, and valued
at current prices.
15.1.7 Security Deposits. Buyer shall receive a check
from Seller for the full amount of any security deposits, with accrued interest,
or a credit against the Purchase Price in said amount.
15.2 Custom and Practice. Except as set forth in this
Agreement, the customs of the State and County in which the Premises are located
shall govern prorations.
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15.3 Future Installments of Taxes. If at Closing, the Property
or any part thereof shall be or shall have been affected by an assessment or
assessments which are or may become payable in installments, then for purposes
of this Agreement, all unpaid installments of any such assessment, including
those which are to become due and payable after Closing shall be assumed by the
Buyer from and after Closing.
15.4 Application of Prorations. If such prorations result in a
payment due Buyer, the cash payable at Closing shall be reduced by such sum. If
such prorations result in a payment due Seller, the same shall be paid by wire
transfer of immediately available funds at Closing.
15.5 Schedule of Prorations. The parties shall endeavor to
jointly prepare a schedule of prorations for the Property no less than five (5)
days prior to Closing.
15.6 Escalations. With respect to any sums due under leases
for operating expenses incurred by the Seller in excess of that billed and
collected by Seller for the calendar year 1996 (the "1996 Expense Escalations"),
the Seller shall after Closing provide to each tenant a statement of the amount
of the 1996 Expense Escalations due from such Tenant, and Seller shall be
entitled to retain the entire amount of such sum, notwithstanding anything
contained in this Section 15 to the contrary. Any 1996 Expense Escalations paid
to the Buyer after Closing shall be immediately remitted to the Seller. With
respect to any sums due under leases for operating expenses incurred by the
Seller in excess of that billed and collected by Seller during 1997 (the "1997
Expense Escalations"), at the time that the Buyer bills and collects the 1997
Expense Escalations, the Buyer shall reimburse the Seller for the actual amount
incurred by Seller for 1997 in excess of that billed and paid by tenants during
1997.
15.7 Readjustments. The parties shall correct any errors in
prorations as soon after the Closing as amounts are finally determined.
16. BROKERS. Each party hereby represents and warrants to the other
that it has not employed or retained any broker or finder in connection with the
transactions contemplated by this Agreement and that neither has had any
dealings with any other person or party which may entitle that person or party
to a fee or commission. Each party shall indemnify the other of and from any
claims for commissions by any person or party claiming such commission by or
through the indemnifying party.
17. ESCROW AGENT. The parties hereto have requested that the Deposit be
held in escrow by the Escrow Agent to be applied at the Closing or prior thereto
in accordance with this Agreement. The Escrow Agent will deliver the Deposit to
Seller or to Buyer, as the case may be under the following conditions:
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17.1 Payment to Seller. To Seller on the Closing Date upon the
consummation of Closing;
17.2 Notice of Dispute. If either Seller or Buyer believes
that it is entitled to the Deposit or any part thereof, it shall make written
demand therefor upon the Escrow Agent. The Escrow Agent shall promptly mail a
copy thereof to the other party in the manner specified in Section 18.1 below.
The other party shall have the right to object to the delivery of the Deposit,
by filing written notice of such objections with the Escrow Agent at any time
within ten (10) days after the mailing of such copy to it in the manner
specified in Section 18.1 below, but not thereafter. Such notice shall set forth
the basis for objection to the delivery of the Deposit. Upon receipt of such
notice, the Escrow Agent shall promptly deliver a copy thereof to the party who
filed the written demand.
17.3 Escrow Subject to Dispute. In the event the Escrow Agent
shall have received the notice of objection provided for in 17.2 above of this
Section, in the manner and within the time therein prescribed, the Escrow Agent
shall continue to hold the Deposit until (i) the Escrow Agent receives written
notice from both Seller and Buyer directing the disbursement of the Deposit in
which case the Escrow Agent shall then disburse said Deposit in accordance with
said direction, or (ii) litigation arises between Seller and Buyer, in which
event the Escrow Agent shall deposit the Deposit with the Clerk of the Court in
which said litigation is pending, or (iii) the Escrow Agent takes such
affirmative steps as the Escrow Agent may, at the Escrow Agent's option elect in
order to terminate the Escrow Agent's duties including, but not limited to,
deposit in Court and an action for interpleader.
17.4 Escrow Agent's Rights and Liabilities. Escrow Agent shall
not be required to determine questions of fact or law, and may act upon any
instrument or other writing believed by it in good faith to be genuine and to be
signed and presented by the proper person, and shall not be liable in connection
with the performance of any duties imposed upon Escrow Agent by the provisions
of this Agreement, except for Escrow Agent's own willful default or gross
negligence. Escrow Agent shall have no duties or responsibilities except those
set forth herein. Escrow Agent shall not be bound by any modification of this
Agreement, unless the same is in writing and signed by Buyer and Seller, and, if
Escrow Agent's duties hereunder are affected, unless Escrow Agent shall have
given prior written consent thereto. In the event that Escrow Agent shall be
uncertain as to Escrow Agent's duties or rights hereunder, or shall receive
instructions from Buyer or Seller which, in Escrow Agent's opinion, are in
conflict with any of the provisions hereof, Escrow Agent shall be entitled to
hold and apply the Deposit, pursuant to Section 17.3, and may decline to take
any other action.
18. GENERAL PROVISIONS.
18.1 Notices. All notices or other communications required or
permitted to be given under the terms of this Agreement shall be in writing, and
shall be deemed effective when (i) personally delivered (ii) sent by
nationally-recognized overnight courier, (iii) facsimile with
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original following by regular mail, or (iv) deposited in the United States mail
and sent by certified mail, postage prepaid, addressed as follows:
18.1.1 If to Buyer, addressed to:
Brandywine Realty Trust
Newtown Square Corporate Campus
16 Campus Boulevard
Suite 150
Newtown Square, PA 19073
Attn: Gerard H. Sweeney,
President and Chief Executive Officer
with a copy in each instance to:
Brad A. Molotsky, Esquire
Pepper, Hamilton & Scheetz LLP
3000 Two Logan Square
Eighteenth & Arch Streets
Philadelphia, PA 19103
18.1.2 If to Seller, addressed to:
LAKN Marlton Associates, L.P.
c/o Needleman Management Co., Inc.
1060 N. Kings Highway
Suite 250
Cherry Hill, NJ 08034
with a copy in each instance to:
Jack Weiner, Esquire
Feinman & Bock
---------------------------------
Philadelphia, Pennsylvania 19103
18.1.3 If to Escrow Agent, addressed to:
M. Gordon Daniels
Commonwealth Land Title Insurance Company
1700 Market Street
Philadelphia, PA
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or to such-other address or addresses and to the attention of such other person
or persons as any of the parties may notify the other in accordance with the
provisions of this Agreement.
18.2 Binding Effect. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns.
18.3 Entire Agreement. All Exhibits attached to this Agreement
are incorporated herein and made a part hereof. This Agreement constitutes the
entire agreement between the parties hereto and supersedes all prior
negotiations, understandings and agreements of any nature whatsoever with
respect to the subject matter hereof. This Agreement may not be modified or
amended other than by an agreement in writing. The captions included in this
Agreement are for convenience only and in no way define, describe or limit the
scope or intent of the terms of this Agreement.
18.4 Governing Law. This Agreement shall be construed and
interpreted in accordance with the laws of the State of New Jersey.
18.5 No Recording. This Agreement shall not be recorded in the
Clerk's Office for Burlington County or in any other office or place of public
record.
18.6 Tender. Tender of Deed by Seller and of the Purchase
Price by Buyer, are hereby mutually waived.
18.7 Execution in Counterparts. This Agreement may be executed
in any number of counterparts, each of which shall be deemed to be an original
as against any party whose signature appears thereon, and all of which shall
together constitute one and the same instrument. This Agreement shall become
binding when one or more counterparts hereof, individually or taken together,
shall bear the signatures of all of the parties reflected hereon as the
signatories.
18.8 Further Instruments. Seller will, whenever and as often
as it shall be reasonably request so to do by Buyer, and Buyer will, whenever
and as often as it shall be reasonably requested so to do by Seller, execute,
acknowledge and deliver, or cause to be executed, acknowledged and delivered,
any and all conveyances, assignments, correction instruments and all other
instruments and documents as may be reasonably necessary in order to complete
the transaction provided for in this Agreement and to carry out the intent and
purposes of this Agreement. All such instruments and documents shall be
satisfactory to the respective attorneys for Buyer and Seller. The provisions of
this Article shall survive the Closing.
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18.9 Time. Time is of the essence. In the event the last day
permitted for the performance of any act required or permitted under this
Agreement falls on a Saturday, Sunday, or legal holiday of the United States or
the State of New Jersey, the time for such performance will be extended to the
next succeeding business day. Time periods under this Agreement will exclude the
first day and include the last day of such time period.
18.10 Designation of Nominee; Assignment of Agreement. Buyer
shall have the right to designate one or more of its subsidiaries or affiliate
entities to acquire title to the Premises hereunder.
18.11 Effective Date. Whenever the term or phrase "effective
date hereof" or "date hereof" or other similar phrases describing the date this
Agreement becomes binding on Seller and Buyer are used in this Agreement, such
terms or phrases shall mean and refer to the date on which a counterpart or
counterparts of this Agreement executed by Seller and Buyer.
18.12 Confidentiality. Each of the parties hereto covenants
and agrees to hold the nature and content of this Agreement, including without
limitation, the Purchase Price contained herein, in strict confidence, and other
than disclosure required by the SEC and except as may be necessary to comply
with this Agreement, neither party shall disclose the nature, content or the
Purchase Price of this Agreement without the express written consent of the
other party.
19. SEC REPORTING (8-K) REQUIREMENTS.
For the period of time commencing on the date hereof and
continuing through the first anniversary of the Closing Date, and without
limitation of other document production otherwise required of Seller hereunder,
Seller shall, from time to time, upon reasonable advance written notice from
Buyer, provide Buyer and its representatives, with (I) access to all financial
and other information pertaining to the period of Seller's ownership and
operation of the Property, which information is relevant and reasonably
necessary, in the opinion of Buyer's outside, third party accountants (the
"Accountants"), to enable Buyer and its Accountants to prepare financial
statements in compliance with any or all of (a) Rule 3-05 or 3-14 of Regulation
S-X of the Securities and Exchange Commission (the "Commission"), as applicable;
(b) any other rule issued by the Commission and applicable to Buyer; and (c) any
registration statement, report or disclosure statement filed with the Commission
by, or on behalf of Buyer; and (II) a representation letter, indicating (if such
be the case) that to the knowledge of the Seller, (i) although the financial
statements provided to the Buyer for the year ended 1996, in accordance with
this Section 19 are unaudited, and do not constitute full disclosure required by
generally accepted accounting principles, the net operating income of the Seller
set forth on such financial statement is in accordance with generally accepted
accounting principles, but the financial statements may not satisfy those
principles, and (ii) the Seller has made available to the Buyer all financial
records and related data requested by the Buyer.
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20. INTENTIONALLY OMITTED PRIOR TO EXECUTION.
21. EXCULPATION.
No recourse shall be had for any obligation of Brandywine
Realty Trust under this Agreement or under any document executed in connection
herewith or pursuant hereto, or for any claim based thereon or otherwise in
respect thereof, against any past, present or future trustee, shareholder,
officer or employee of Brandywine Realty Trust, whether by virtue of any statute
or rule of law, or by the enforcement of any assessment or penalty or otherwise,
all such liability being expressly waived and released by the Seller and all
parties claiming by, through or under Seller.
22. Tax Deferred Exchange. The Seller intends to effectuate a
"like-kind exchange" pursuant to Section 1031 of the Internal Revenue Code, and
to utilize the Property as "Relinquished Property" and the sale thereof in
connection with such like-kind exchange. The Buyer shall fully cooperate with
Seller in effectuating any like-kind exchange, including, execution of exchange
documentation with a "qualified intermediary" who may take title to the
Replacement Property or other real property ("Replacement Parcel") identified by
the Seller provided that nothing herein contained is intended to require the
Buyer to close title to any Replacement Parcel. Seller's effectuation of a
like-kind exchange prior to any closing shall not be a condition or contingency
to the Seller's obligations hereunder. Seller shall be responsible for all costs
and expenses incurred in connection with the effectuation of a like-kind
exchange over and above those Buyer would incur in a straight purchase/sale.
Seller shall indemnify and hold harmless Buyer from any and all losses, costs,
expenses and damages associated with Buyer's participation in the exchange
transaction. The Property subject to this Agreement constitute Relinquished
Property in the Internal Revenue Code
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Section 1031 exchange.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed the day and year first above written.
LAKN MARLTON ASSOCIATES, L.P. BRANDYWINE REALTY TRUST,
a New Jersey Limited Partnership a Maryland Real Estate Investment Trust
By: /s/ Howard E. Needleman By: /s/ Gerard H. Sweeney
----------------------------- ---------------------------------
Name: Gerard H. Sweeney, President and
Chief Executive Officer
JOINDER:
Howard Needleman and Ira Lubert (the "Guarantors"), hereby specifically
join in this Agreement for the sole purpose of guarantying the accuracy of the
representation and warranty contained in Section 5.7 of this Agreement. The
Guarantors shall indemnify, defend and save the Buyer harmless from any loss,
cost, damage and expense actually incurred by the Buyer after the Closing as a
result of a breach of any of the representations and warranties contained in
Section 5.7 of the Agreement, provided that (i) the Guarantors shall have no
liability hereunder unless and until the Buyer's losses as a result of such a
breach exceeds $5,000.00; (ii) the Guarantors' liability hereunder shall
terminate and be of no further effect with respect to any claim not made within
three months from the date of Closing; and (iii) with respect to any tenant for
which, Seller delivers to Buyer an estoppel certificate on Buyer's prescribed
form, which certificate confirms Seller's representations under Section 5.7 of
this Agreement, Seller shall be released from all liability with respect to its
representations as they pertain to such tenancy.
/s/ Howard E. Needleman
-------------------------------
HOWARD E. NEEDLEMAN
/s/ Ira Lubert
-------------------------------
IRA LUBERT
Agreed to by Escrow Agent with regard to the obligations, terms, covenants and
conditions contained in this Agreement relating to Escrow Agent.
By: /s/ M. Gordon Daniels
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