Exhibit 10.1
PURCHASE AND SALE AGREEMENT
This Purchase And Sale Agreement (the "Agreement") is entered into on the
26th day of April 1999 between Sheridan Realty Partners, L.P., a Delaware
limited partnership ("Seller"), and AmeriVest Properties Inc., a Delaware
corporation ("Purchaser"). For purposes of this Agreement, each of Seller and
Purchaser may be referred to individually as a "Party", and both Seller and
Purchaser may be referred to collectively as the "Parties".
Recitals
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A. Seller owns a fee simple interest in three multi-tenant office buildings
located at 3021, 3077 and 3091 East 98th Street at the intersection of 98th
Street and North Keystone Avenue (US 431) in north central Indianapolis,
Indiana, consisting of approximately 95,836 total rentable square feet on
approximately 9.041 acres of land with 336 surface parking spaces, plus a 1,596
square foot free-standing maintenance building together with a reserve for
capital improvements in the amount of $72,637 as of January 1, 1999 and which
may be utilized in accordance with the 1999 budget previously given to Purchaser
(the "Property"). Seller also owns a fee simple interest in a vacant parcel (the
"ROFR Parcel") of approximately 2.550 acres in size located in the east portion
of Keystone Office Park, which Seller intends to develop. The Property and the
ROFR Parcel are more particularly described in Exhibit A attached to and made a
part of this Agreement.
B. Purchaser desires to purchase from Seller, and Seller desires to sell to
Purchaser, the Property. As part of its purchase of the Property, Purchaser
desires to receive, and Seller desires to grant, a first right to purchase and a
right of first refusal to purchase the ROFR Parcel pursuant to the terms of this
Agreement.
Agreement
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In consideration of the premises and of the mutual covenants contained in
this Agreement, the Parties agree as follows:
1. Purchase And Sale Of Property.
1.1 Purchase And Sale. Subject to the terms and conditions of this
Agreement, Seller agrees to sell to Purchaser, and Purchaser agrees to
purchase from Seller, the Property.
1.2 Purchase Price. The purchase price (the "Purchase Price") for the
Property shall be $7,944,000, payable in a combination of stock and
assumption of debt as follows:
1.2.1 The assumption of approximately $5,279,000 in mortgage debt
(the "Mortgage Debt") on the Property with all costs of assumption to
be paid by Seller, which Mortgage Debt is represented by a Mortgage
Note, Mortgage and Security Agreement and Assignment of Leases and
Rents (the "Mortgage") dated April 3, 1997 between Seller as Mortgagor
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and Security Life of Denver Insurance Company, a Colorado corporation,
as Mortgagee and Lender. The amount of Mortgage Debt assumes
additional borrowing of approximately $525,000 by Seller prior to or
simultaneously with the Closing; plus
1.2.2 The assumption commencing on the Effective Date (as defined
in Section 10 below) of all obligations and liabilities that are
incurred under all guarantees, indemnification and other agreements
made by Seller and Alexander S. Hewitt ("Hewitt") in that Guaranty and
Suretyship Agreement and Environmental Indemnification and Hold
Harmless Agreement dated April 3, 1997 and made by Seller, William
Atkins, Jennifer Atkins (collectively, "Atkins") and Hewitt for the
benefit of The First National Bank of Boston ("Prior Mortgagee") in
that Indemnity Agreement Regarding Hazardous Materials dated October
18, 1996 ("Indemnification Agreements") but only to the extent that
any such obligations or liabilities assumed by Purchaser result from
acts or omissions occurring on or after the Effective Date; plus
1.2.3 The number of shares (the "Purchaser Shares") of the
restricted common stock of Purchaser determined by dividing the
difference between the Purchase Price and the Mortgage Debt as of the
Closing Date by $4.75.
1.3 Adjustment Of Purchase Price And Purchaser Shares.
1.3.1 Adjustment For Dividends. If (i) the Effective Date (as
defined in Section 10) occurs during a calendar quarter (the
"Effective Quarter") in which there also occurs a record date (the
"Effective Quarter Record Date") for determination of those
stockholders of Purchaser that are entitled to receive a common stock
dividend declared by Purchaser (the "Effective Quarter Dividend"), and
(ii) the Effective Date is not the same day as the Effective Quarter
Record Date, then the Purchase Price shall be reduced by an amount
equal to the product of the number of Purchaser Shares multiplied by
the amount of the Effective Quarter Dividend per share, multiplied by
a fraction the numerator of which is the difference between 90 and the
number of days by which the Effective Date precedes the Effective
Quarter Record Date and the denominator of which is 90. For example,
if the number of Purchaser Shares is 560,000, the Effective Date is
June 1, 1999, the Effective Quarter Record Date is June 30, 1999 and
the dividend per share is $.12, then the Purchase Price would be
reduced by $44,800, which is equal to 560,000 multiplied by $.12 and
multiplied by 60/90. To the extent that the Purchase Price is to be
reduced pursuant to the provisions of this paragraph and the reduction
has not occurred, or a credit for the reduction not yet paid, as of
the dividend payment date for the Effective Quarter Dividend, Seller
agrees that Purchaser may deduct from the Effective Quarter Dividend
payable to Seller with respect to the Purchaser Shares an amount equal
to the amount by which the Purchase Price is to be reduced pursuant to
this Section 1.3.1.
1.3.2 Issuance Of Additional Shares; Adjustment Based On Stock
Price. Purchaser agrees that if the Weighted Average Trading Price (as
determined in accordance with this Section 1.3.2) of Purchaser's
common stock for the 15 trading days prior to the one year anniversary
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date of the Closing Date is less than $4.75 per share, then Purchaser
shall issue to Seller the number of additional shares (the "Adjustment
Shares") of Purchaser's common stock determined in accordance with
this Section 1.3.2. The number of Adjustment Shares shall be
determined by multiplying the number of Purchaser Shares by the excess
of $4.75 over the Weighted Average Trading Price and dividing the
product by the Weighted Average Trading Price. By way of illustration,
if the Weighted Average Trading Price is $4.00 per share and 561,053
Purchaser Shares were delivered at Closing, then Purchaser will issue
to Seller 105,197 Adjustment Shares. This is calculated by (i)
multiplying $.75 (the excess of $4.75 over the Weighted Average
Trading Price) by the 561,053 Purchaser Shares that were delivered at
the Closing, and (ii) dividing the product by 4.00 to determine the
Adjustment Shares. The Adjustment Shares, if any, required to be
delivered pursuant to this Section 1.3.2 shall be delivered to Seller
on or before the 30th day following the first anniversary of the
Closing Date. The Weighted Average Trading Price of Purchaser's common
stock shall mean the average trading price determined by multiplying
the number of shares involved in each individual trade during the
period of determination by the sale price for that trade and dividing
the sum of all those amounts by the total number of shares traded
during the relevant period of determination.
1.3.3 Additional Adjustments. The adjustments to the Purchase
Price and Purchaser Shares pursuant to this Section 1.3 shall be in
addition to any adjustments and prorations required pursuant to
Section 11 of this Agreement.
2. Title.
2.1 f this Agreement, , Seller has furnished to Purchaser a current
commitment for an A.L.T.A. owner's extended coverage title insurance policy
(with preprinted exceptions to be deleted) issued by Chicago Title
Insurance Company (the "Title Company"), for the Property in at least the
amount of the Purchase Price. Included with the title commitment shall be
true, correct, and legible copies of all documents listed in the schedule
of exceptions in the commitment. The title commitment and the underlying
exception documents are hereinafter collectively referred to as the "Title
Commitment". Seller will arrange to have the Approved Title Policy
delivered to Purchaser as soon as practicable after Closing. Seller shall
pay the cost of obtaining the Title Commitment.
2.2 Purchaser shall, within five (5) days after receipt of the Title
Commitment and prior to the signing of this Agreement, approve or
disapprove the Title Commitment by delivering written notice to Seller
("Purchaser's Title Notice") specifying each title defect or matter which
needs to be cured by Seller ("Title Defect") in order for the "Approved
Title Policy" (as defined below) to be issued for the Property at the
Closing. For purposes of this Agreement, the term "Approved Title Policy"
shall mean the title policy to be issued by the Title Company, in the form
and with the exceptions and endorsements acceptable to Purchaser,
designated to Seller by Purchaser either as part of Purchaser's Title
Notice or separately in writing on or before the Contingency Date.
Purchaser acknowledges that, unless otherwise expressly agreed to by
Seller, Purchaser will be responsible for paying any title insurance
premiums required to obtain any endorsement specified by Purchaser other
than endorsements required to deliver the Title Commitment as specified in
Section 2.1 and any endorsements required by the Mortgagee, the cost of
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which shall be paid by Seller. Seller agrees to cure all Title Defects
other than the Permitted Title Exceptions, as defined below, up to a
maximum cost to cure those Title Defects of $10,000. For purposes of this
Agreement, the following shall constitute "Permitted Title Exceptions": (i)
covenants, conditions and restrictions of record acceptable to the
Purchaser in its sole discretion; (ii) private, public and utility
easements and roads and highways acceptable to the Purchaser in its sole
discretion; (iii) existing leases and tenancies as listed in Exhibit B
attached hereto and any leases entered into pursuant to Paragraph 5.4; (iv)
general taxes for the year 1998 and subsequent years; (v) such additional
exceptions as the Purchaser may consent to in writing; (vi) liens accruing
from debt created or assumed as part of the Purchase Price, and (vii) any
other exception accepted or waived by Purchaser in writing. Within five
business days after receiving Purchaser's Title Notice, Seller shall
deliver to Purchaser written notice ("Seller's Title Notice") of those
Title Defects which Seller is unable or unwilling to eliminate or to cure.
If Seller does not eliminate or cure all Title Defects other than Permitted
Title Exceptions, then Buyer shall have the right, by written notice to
Seller within five business days after receipt of Seller's Title Notice,
either to (i) waive its prior notice as to the Title Defects, other than
Permitted Title Exceptions, that Seller is unwilling or unable to cure, or
(ii) proceed with the Closing and reduce the Purchase Price by an amount
equal to Purchaser's good faith estimate of the cost to cure the Title
Defects, other than Permitted Title Exceptions, that Seller is unwilling or
unable to cure but in no event shall such reduction exceed the excess of
$10,000 over the amount previously spent by Seller to cure pursuant to the
provisions of this paragraph, or (iii) terminate this Agreement.
2.3 Seller shall deliver to Purchaser the Approved Title Policy issued
by the Title Company in the amount of the Purchase Price, insuring
Purchaser that Purchaser has acquired Seller's interest in the Property
subject only to the Permitted Title Exceptions. Seller shall pay the cost
of the title insurance premium for (i) the Approved Title Policy with all
standard pre-printed exceptions deleted, and (ii) the endorsements required
by Mortgagee. If Purchaser elects to obtain extended coverage or any other
endorsements to the policy, Purchaser shall pay all costs and expenses
associated therewith and comply with any requirements thereof.
3. Environmental Audit. Seller has provided Purchaser with a Phase I
Environmental Site Assessment (including asbestos investigation) dated August
20, 1996 for the Property in conformity with the 1993 standards set by the
American Society for Testing and Materials prepared by ATEC Associates, Inc.
(the "Phase I Report"). Purchaser has, at Purchaser's expense, ordered a revised
Phase I Report (the "Revised Report") for the Property. In the event hazardous
waste or materials or nonhazardous materials that are controlled by the
Department of Health for the State of Indiana or by the Environmental Protection
Agency are revealed at the Property or historical uses as shown by the Phase I
Report or Revised Report that would indicate the possible presence of such waste
or materials in amounts which are, or in the reasonable judgment of Purchaser
may result, in violation of applicable laws or the Phase I Report or Revised
Report indicates that Seller is in violation of any local, state or federal
environmental laws, rules or regulations, then Seller shall, at Seller's cost
and expense, reimburse Purchaser for the cost of the Revised Report, and
remediate to the extent required by law or to prevent a violation of law, all
such waste, materials and violations prior to Closing so long as the reasonable
estimate of the cost and expense to remediate conditions on the Property does
not exceed a total of $50,000 . In the event such remediation cannot be
accomplished by the Closing Date, the Closing Date shall be extended up to an
additional 90 days ("Extended Closing Date") to allow Seller sufficient time to
complete the remediation . If the reasonable estimate of the cost to remediate
exceeds $50,000 or the time to complete the remediation will extend past the
Extended Closing Date, then Seller shall have the right to terminate this
Agreement by providing notice to Purchaser and by reimbursing Purchaser, as
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required above, for the cost of the Revised Report. However, Seller's right to
terminate under this Section 3 shall not be effective if, within five days of
notice to Purchaser of Seller's termination under this Section 3, Purchaser
delivers to Seller a written notice that Purchaser will proceed with this
Agreement. In the event that Purchaser elects to proceed hereunder, the Purchase
Price shall be reduced by the lesser of Purchaser's good faith estimated cost to
remediate or $50,000, and Seller shall continue to be responsible for the cost
of the Revised Report, which shall be deducted from the Purchase Price at
Closing if not paid previously. Notwithstanding anything to the contrary
contained herein, Purchaser retains the right to object to matters disclosed in
the Phase I Report or Revised Report in accordance with Section 8.7 of this
Agreement.
4. Survey. On or before ten (10) days after the execution of this
Agreement, Seller shall furnish to Purchaser a current ALTA/ACSM land title
survey for the Property (the "Survey") updated by a land surveyor licensed in
the State of Indiana. The Survey shall be certified to Seller, Purchaser and the
Title Company and Mortgagee, if requested by the Mortgagee. The Survey shall
reflect all exceptions to title (where applicable) as reflected on the Title
Commitment. The Survey shall provide that physical inspections at the Property
revealed no improvements situated upon or adjacent to the Property which are the
subject of any encroachments, and that no easements or rights-of-way have been
physically violated in any respect, except as shown in the Survey. Seller shall
pay the cost of the Survey. Purchaser retains the right to object to any matters
disclosed in the Survey or to the failure of the Survey to conform with the
provisions of this Section 4 in accordance with Section 8.7 of this Agreement.
5. Warranty As To Leases. Seller warrants that the attached Exhibit B is a
complete list of all leases, tenancies, rental agreements, and concession
agreements presently encumbering the Property; and that:
5.1 No person, firm, or corporation has any title, interest, or right
to possession of the Property or any portion of the Property as a lessee,
tenant, or concessionaire of Seller except as shown on Exhibit B and the
names as set forth in Exhibit B are the names of all tenants, lessees and
concessionaires which have a right of possession at the Property, whether
or not under a written instrument (which shall be specified) as of February
28, 1999; the date set forth for each tenant, lessee and concessionaire is
the date of the lease, tenancy, rental or concessionaire agreement pursuant
to which the tenant, lessee or concessionaire occupied the Property as of
February 28, 1999.
5.2 All the leases, tenancies, rental agreements, and concession
agreements shown on Exhibit B are now in full force and effect; except as
set forth on Exhibit B, none of Seller nor any of the tenants, lessees or
concessionaires set forth on Exhibit B is in default in the performance of
any such instrument or agreement; and, no tenant, lessee, or concessionaire
is entitled to any rebate, concession, or other benefit except as set forth
in the leases and agreements referred to in Exhibit B or in Exhibit B.
5.3 The rentals and other sums due or to become due under the leases
and agreements referred to in Exhibit B have not been assigned or
encumbered by Seller except as additional security under the Mortgage
against the Property, and will not be further assigned, encumbered, or
subjected to any liens by Seller prior to the Closing pursuant to this
Agreement.
5.4 Until Closing, Seller shall continue its present rental efforts at
the Property to rent vacant space, provided that after the date of mutual
execution of this Agreement, Seller shall not execute any new leases or
amend, terminate or accept the surrender of any existing tenancies or
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approve any subleases without the prior consent of Purchaser in accordance
with Section 20.2, except that Seller is authorized to accept the
termination of leases at the end of their existing terms and provided that
if Seller does execute a new lease or amends, terminates or accepts the
surrender of any existing tenancy or approves any sublease without
following the procedures set forth in Section 20.2, Purchaser may terminate
this Agreement and this Agreement shall be of no further force or effect.
6. Warranty As To Insurance. Seller warrants that the attached Exhibit C is
a complete list of all insurance policies now insuring the Property and that
Seller shall keep all such insurance policies in full force and effect until the
Closing. Seller warrants that Exhibit C shows (a) the number of each policy; (b)
the name of the insurance company that issued each policy; (c) the term,
expiration date and property covered by each policy; (d) the premiums on each
policy; and (e) the general nature and type of each policy set forth on Exhibit
C. Seller shall obtain and deliver to Purchaser at the Closing the written
approval of each insurance carrier to the assumption by Purchaser of each policy
specified by Purchaser in writing at least 45 days prior to the Closing Date. In
the event Seller is unable to obtain all such approvals on or before the
Closing, Purchaser shall have an option to (i) obtain alternative coverage
through another carrier or (ii) terminate this Agreement if no similar coverage
is available from an alternative carrier.
7. Corporate Resolutions Regarding Sale. At the Closing, Purchaser shall
provide to Seller a copy of resolutions of the Board of Directors of Purchaser
authorizing the execution and performance of this Agreement, including the
authorization of issuance of Purchaser Shares and Adjustment Shares and
directing the submission of the Agreement to a shareholder vote on the record
date set by Purchaser, which resolutions shall be certified by the secretary of
Purchaser.
8. Contingencies. This Agreement is contingent upon each of the following:
8.1 Financing. Purchaser's obligations pursuant to this Agreement are
expressly contingent upon the approval of Security Life of Denver Insurance
Company as the Mortgagee pursuant to the Mortgage securing the Mortgage
Debt to the transfer to Purchaser of Seller's obligations pursuant to the
Mortgage. If Purchaser has not received approval from the Mortgagee in a
form reasonably acceptable to Purchaser prior to the Closing, Purchaser may
terminate this Agreement without penalty upon written notice to Seller of
Purchaser's intention to terminate.
8.2 Leases. Approval by Purchaser of all leases and lease amendments
encumbering the Property. Seller shall deliver copies of the leases and
lease amendments to Purchaser within ten calendar days after the date of
mutual execution of this Agreement.
8.3 Management Records. Approval by Purchaser of true and complete
copies of the Income and Operating Expense Statements and Statements of
Assets and Liabilities relating to the Property since October, 1996 and
documentation, including estoppel letters in the form of Exhibit D from
tenants leasing at least 75% of the total rentable square footage of the
Property showing the current status of each lessee under that lessee's
lease. Seller shall deliver copies of said financial and lease documents to
Purchaser within ten calendar days after the date of mutual execution of
this Agreement. Estoppel letters shall be delivered to Purchaser no later
than the Closing Date.
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8.4 Service Contracts. Approval by Purchaser of all management,
service and other contracts pertaining to the Property in accordance with
Section 20.2. Seller shall deliver copies of the management, service and
other contracts pertaining to the Property to Purchaser within ten calendar
days after the date of mutual execution of this Agreement
8.5 Personal Property. Approval by Purchaser of a list of all personal
property now owned by Seller and used in connection with the management of
the Property. Seller shall deliver said list of personal property to
Purchaser within ten calendar days after the Effective Date
8.6 Permits, Licenses, Etc. Seller shall assign to Purchaser all
permits, certificates and licenses in its possession relating to the
Property. Seller shall use its best efforts to assist Purchaser in
obtaining such additional permits, certificates or licenses as may be
required. Seller shall obtain and deliver to Purchaser a certificate or
letter from the applicable zoning authority in a form reasonably
satisfactory to Purchaser stating that the Property is in compliance with
all applicable zoning and building code rules and regulations.
8.7 Investigation. The satisfactory completion of Purchaser's and
Seller's respective investigations pursuant to this Section 8.7. Purchaser
and Seller shall each have until 30 days after the date of delivery by the
other of the Property Information or the Corporate Information defined
below, as the case may be, but no later than May 21, 1999 (the
"Investigation Period") during which Seller shall furnish Purchaser with
all information and data including, but not limited to, accounts, books and
records, rent rolls, leases, loan documents, agreements, environmental
reports, plans, specifications, permits, accounting and financial
information and any other information of whatsoever kind or nature in
Seller's possession ("Property Information") in connection with the
Property, and Purchaser shall be permitted to inspect, make engineering,
architectural, environmental and economic studies, test soil and otherwise
determine ("Property Investigation") that the Property is suitable for
Purchaser's intended purpose. During the Inspection Period, Purchaser shall
furnish Seller with Property Information regarding all of Purchaser's real
property assets, and Seller shall be permitted to perform an appropriate
Property Investigation regarding such properties. Purchaser also shall
furnish Seller with any corporate information (the "Corporate Information")
reasonably requested by Seller. If either Purchaser or Seller is not
satisfied, in its sole discretion, with any aspect of the Corporate
Information, the Property Information or the Property Investigation
regarding the other's property, the dissatisfied party may terminate this
Agreement by written notice to the other, delivered on or before the end of
the Investigation Period, in which case all information or other items
shall be returned and each party shall be relieved of all obligations under
this Agreement. Notwithstanding the foregoing, if Purchaser orders
environmental, engineering, appraisal and other reports within three
business days after mutual execution of this Agreement, and all such
reports have not been received by Purchaser in final form at least five
business days prior to the end of the Investigation Period, or if, as a
result of its respective investigation Seller reasonably requests
additional Corporate Information or Purchaser reasonably requests
additional Property Information, then the Investigation Period shall be
extended so that it ends five business days after the last such Corporate
Information is received by Seller or such report or Property Information
has been received in final form by Purchaser, but in no event later than
June 30, 1999.
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8.8 Property Tax. Approval by Purchaser of all real and personal
property taxes pertaining to the Property as evidenced on the Title
Commitment or other documentation provided by Seller or the appropriate
taxing authority.
8.9 Stockholder Approval. The receipt by Purchaser of all approvals
necessary from Purchaser's stockholders and for the issuance of the
Purchaser Shares and Adjustment Shares to Seller in accordance with this
Agreement.
8.10 Limited Partner Approval. The receipt by Seller of all approvals
necessary from Seller's limited partners as may be required under the
Limited Partnership Agreement of Seller.
8.11 Assumption Of Indemnification Agreements. Execution of
appropriate indemnification agreements as contemplated by Section 1.2.2 of
this Agreement.
In the event any of the foregoing contingencies are not met at or
before the Closing, and absent an agreement of the Parties to resolve an
unsatisfied contingency, this Agreement shall terminate.
9. Deliveries At Closing.
9.1 At Closing, Seller shall deliver to Purchaser the following:
9.1.1 A special warranty deed conveying title to the Property to
Purchaser in a form reasonably acceptable to Purchaser and Seller.
9.1.2 The Title Commitment. 9.1.3 Any other documents required to be
delivered pursuant to this Agreement. 9.1.4 At and after Closing, such
additional and customary documents necessary to carry out or complete
the transaction set forth in this Agreement.
9.2 At Closing, Purchaser shall deliver to Seller the following:
9.2.1 A stock certificate representing Purchaser Shares
registered in the name of Seller, or the individual partners of
Seller, who have executed and delivered to Purchaser subscription and
registration rights agreements in the form of Exhibit E attached to
this Agreement, as required by Section 21.8 and as may be directed by
Seller, or, if such stock certificates are not available at the
Closing or Purchaser has not received a subscription and registration
rights agreement signed by an individual partner of Seller, an
undertaking signed by Purchaser's stock transfer agent to issue such
certificates directly to the Seller or the individual partners of
Seller upon Purchaser's receipt of the respective subscription and
registration rights agreement signed by the individual partner of
Seller.
9.2.2 At and after Closing, such additional and customary
documents necessary to carry out or complete the transaction set forth
in this Agreement.
10. Closing Date. Closing shall take place at a time to be established by
Purchaser and Seller but not later than the later to occur of: (i) five business
days after Purchaser's receipt of stockholder approval as required by Section
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8.9 or (ii) the approval of Mortgagee of the assumption by Purchaser of the
Mortgage obligations as required by Section 8.1 and in no case later than August
31, 1999 (the "Closing" or "Closing Date"). to be effective as of12:01 AM on the
first day of the calendar month during which the Closing occurs (the "Effective
Date"). The Closing shall take place at the offices of Purchaser or at the
offices of Purchaser's counsel, as determined by Purchaser.
11. Prorations And Closing Costs. At Closing, the following items shall be
prorated between Purchaser and Seller as of 12:01 a.m. on the Closing Date and
shall be adjusted against the Purchase Price and payable in certified funds at
the Closing:
11.1 Real and personal property taxes which are due as of the Closing,
shall be paid by Seller or allowed as a credit against the Purchase Price.
All unpaid real estate taxes which were a lien in 1998 and will be due and
payable in 1999 will be charged to Seller and allowed as a credit against
the Purchase Price. All other real estate taxes and other assessments which
will become a lien in 1999 against the Property but are not due and payable
until 2000 shall be prorated as of the Closing Date, and if the amount of
taxes due for 1999 but not payable until 2000 has not yet been fixed by
Closing, such taxes shall be prorated based upon the most recent available
mill levy applied to the latest assessed valuations and any assessments,
special or general. All other real estate and personal property taxes,
charges and assessments of municipal or other improvements payable
thereafter shall be paid by Purchaser.
11.2 Seller and Purchaser shall cooperate to cause all utility
suppliers furnishing electrical, gas, water, or other utility services to
the Property to read all utility meters on the Closing Date and to bill
Seller separately for all such charges. Purchaser shall be responsible for
making its own arrangements with respect to future billings and deposits.
In the event any such utility supplier refuses to read and bill any such
utilities, then such utility charges shall be prorated at or after the
Closing in accordance with this Section 11 based upon the bill for the
preceding billing period.
11.3 Any insurance policies held in Seller's name that are not assumed
by Purchaser shall be cancelled as of the Closing Date. Premiums on all
insurance policies applicable to the Property that are assumed by Purchaser
shall pro rated in accordance with this Section 11.
11.4 The portion of current rents and prepaid rents, additional rents,
reimbursements and/or other sums payable by tenants under any leases or
subleases relating to the Property ("Leases"), if any, collected by Seller
prior to the Closing Date which are allocable to the period commencing with
and following the Closing Date shall be paid to Purchaser at Closing.
Notwithstanding the foregoing, if any past-due rents, additional rents,
reimbursements and/or other sums (collectively, "Rentals") are owing by
tenants under the Leases at the Closing Date, all such Rentals shall be
prorated on the basis of the time period for which they were due, and
Purchaser shall within ten (10) days after receipt and clearance of checks
pay to Seller any Rentals which pertain to the time period prior to
Closing.
11.5 All charges and revenues arising out of the service contracts
which Purchaser has not elected to terminate shall be prorated as of the
Closing. All charges and revenues arising out of the service contracts
which Purchaser has elected to terminate shall be paid by Seller as long as
Purchaser notifies Seller not less than 35 days prior to Closing which
contracts will be terminated.
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11.6 Any prepaid expenses relating to the Property.
Seller shall be responsible for the cost of (i) the owner's title insurance
policy; (ii) updating the Survey; (iii) one-half of any escrow fees and real
estate transfer, stamp or documentary taxes; (iv) any sales or use taxes
relating to the transfer of personal property to the Purchaser; and (v) all fees
and costs (except Purchaser's attorneys' fees) related to assumption of the
Mortgage Debt by Purchaser. Purchaser shall be responsible for: (i) one-half of
any escrow fees and real estate transfer, stamp or documentary taxes; (ii)
recording the special warranty deed from Seller to Purchaser; and (iii)
mortgagee's title insurance, if any. Seller and Purchaser shall each pay the
fees and disbursements of its respective counsel and any inspecting architects,
engineering or other consultants hired by such party. In addition, Seller shall
deliver to Purchaser all security deposits previously collected by Seller from
tenants, if any, and any prepaid rent collected by Seller.
Purchaser and Seller agree to calculate all prorations required under this
Section 11 with respect to those items which cannot be accurately or finally
determined at Closing and to make the applicable payments resulting from those
calculations within 30 days after Closing. Each of these calculations shall be
apportioned retroactive to the Effective Date. If any errors or omissions are
made regarding adjustments and prorations the parties shall make appropriate
corrections promptly upon the discovery thereof. If any estimations are made at
the Closing regarding adjustments or prorations, the parties shall make the
appropriate corrections promptly when accurate information becomes available.
Any corrected adjustment or proration shall be paid in cash to the appropriate
party within fifteen (15) days of the correction or adjustment. Notwithstanding
anything to the contrary in this Section 11, any right to a correction or
adjustment shall terminate one (1) year after the Closing.
12. Assessments. Any bonds or improvement assessments which are a recorded
lien on the Property shall be assumed by Purchaser at the Closing.
13. Casualty Loss. If, prior to Closing, the Property shall be damaged or
destroyed by fire, explosion, disaster, earthquake, accident, disturbance or act
of God (except any damage or destruction caused by Purchaser or its agents,
servants or employees), within five days of becoming aware of such damage or
destruction, Seller shall deliver to Purchaser written notice thereof and the
estimated cost of repair, based upon Seller's reasonable good faith business
judgement. If the Property is " substantially damaged" i.e. (1) the estimated
cost of repairing such damage or destruction exceeds in the aggregate $100,000,
or (2) the casualty materially and adversely affects access to the Property, or
(3) the casualty would give one or more tenants with an aggregate total rental
square footage of more than 10,000 square feet, the right to terminate their
respective leases, or (4) the casualty would cause the rent of any one or more
tenants to abate for any period of time unless Seller is willing to credit
Purchaser for the full amount of the abated rent, this Agreement shall
automatically terminate unless Purchaser delivers to Seller written notice
waiving the right to terminate within five days following delivery to Purchaser
of Seller's notice of such damage. If Purchaser delivers notice of such waiver
10
within such five-day period the transactions required by this Agreement shall
nevertheless close on the scheduled date, according to the terms of this
Agreement, and Seller shall assign to Purchaser all of Seller's rights to any
insurance proceeds payable as a result of such damage or destruction, except for
any claim for rent loss incurred prior to the Closing, and the Purchase Price
shall be reduced by the amount of the estimated cost of repairing such damage or
destruction that is not paid by insurance up to a maximum of $100,000. If the
estimated cost of repairing, such damage or destruction is equal to or less than
$100,000, and if the casualty is not one that otherwise gives Purchaser the
right to terminate this Agreement pursuant to this Section 13, the Closing shall
proceed and Seller shall assign to Purchaser all of Seller's rights to any
insurance proceeds payable as a result of such damage or destruction, except for
any claim for rent loss incurred prior to the Closing, and the Purchase Price
shall be reduced by the amount of the estimated cost of repairing such damage or
destruction that is not paid by insurance. If any damage to or destruction of
the Property is caused by Purchaser or its agents, servants or employees, then
the transactions required and contemplated by this Agreement shall nevertheless
close according to the terms of this Agreement, there shall be no reduction of
the Purchase Price and Purchaser shall be solely responsible for all repairs or
reconstruction unless such damage or destruction is covered by insurance, in
which event all insurance proceeds otherwise payable to Seller (except for any
claim for rent loss incurred prior to Closing) shall be assigned to Purchaser.
14. Representations And Warranties By Seller. Seller hereby represents and
warrants to Purchaser that the following are true and correct as of the date of
the execution of this Agreement and that the following shall be true and correct
as of the Closing:
14.1 Seller is duly organized, validly existing, and in good standing
under the laws of the State of Delaware and has the power and authority to
carry on its business and to enter into this Agreement and the transactions
contemplated hereby.
14.2 The improvements situated on the Property are connected to all
public utility systems (including without limitation the sewer system) and,
to the best of Seller's knowledge, all utility systems are operational and
in compliance with all applicable public and private requirements.
14.3 Except as previously disclosed to Purchaser, to the best of
Seller's knowledge, there are no actions, suits, investigations, or
proceedings at law or in equity by or before any court, governmental
instrumentality, commission, or other agency now pending or threatened or
against or affecting Seller or any of Seller's properties or rights, before
any court, arbitrator, or administrative or governmental body which may
result in an adverse change in Seller's business or any of their respective
conditions, financial or otherwise. Further, Seller is not in default with
respect to any order, writ, injunction, or decree of any court or any
governmental agency or department.
14.4 Except for the requirement that the sale of the Property to
Purchaser be approved by the limited partners of Seller as contemplated by
Section 8.10 of this Agreement, Seller and Seller's appointed
representatives have full power, authority and legal right to execute and
deliver and to perform and observe the provisions hereof and of the
transactions contemplated hereby. Seller is not in default in the
performance of any obligation, covenant or condition in any agreement,
decree, or order to which Seller is party or by which Seller is bound or to
which any of Seller's properties are subject, including this Agreement.
Seller is not a party to a contract or agreement or subject to any
restriction which adversely affects Seller's business, property, assets or
financial condition. Seller is not a party to or otherwise subject to any
contract or agreement which restricts or otherwise affects Seller's right
or ability to undertake the transactions contemplated hereby or the
performance of any of its respective terms.
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14.5 Seller's execution of this Agreement will not violate any
provision of law or any agreement previously entered into, other than the
Mortgage and Indemnification Agreements which are being assumed by
Purchaser to the extent set forth in Section 1.2.2 as a condition of
Closing and for which Seller shall obtain all required consents or waivers
prior to Closing.
14.6 No tax liability which is now past due, including without
limitation, income tax liability, of any nature has been asserted against
Seller or the Property by any taxing authority.
14.7 Neither this Agreement nor any other document, certificate, or
statement furnished to Purchaser by Seller or any partner, employee, or
affiliate of Seller or, to the best knowledge of Seller, by any third party
in connection with the transactions contemplated hereby, contains any
untrue statement of material fact or omits to state a material fact
necessary in order to make the statements contained herein and therein not
misleading. All of Seller's financial statements submitted to Purchaser
have been prepared in accordance with generally accepted accounting
principles consistently applied, unless otherwise expressly noted.
14.8 To the best of Seller's knowledge, no consent, approval,
authorization, permit or license from any federal, state, or local
regulatory authority is required in connection with the transactions
contemplated herein.
14.9 To the best knowledge of Seller, the improvements situated on the
Property are complete and structurally sound and all mechanical systems
contained therein are adequate for their intended use and in proper working
condition. Other than as previously disclosed to Purchaser, the Property
does not require any major repairs or further work.
14.10 Seller represents and warrants that based on its review of the
Phase I Report and its ownership and management of the Property since the
date of such report, neither the Property nor Seller, nor, to the best of
Seller's knowledge, any previous owner of the Property, is in violation of
or subject to any existing, pending or threatened investigation or inquiry
by any governmental authority or any remedial obligations under any
applicable laws, rules or regulations pertaining to health or the
environment, including, without limitation, the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended ("CERCLA") and
the Resource Conservation and Recovery Act of 1976, as amended ("RCRA"),
and Seller further represents and warrants that there are no facts,
conditions or circumstances known to Seller which could result in any such
investigation or inquiry if such facts, conditions and circumstances, if
any, were fully disclosed to the applicable governmental authority. Seller
represents and warrants that Seller has not obtained and Seller is not
required to obtain any permits, licenses, or similar authorizations to
construct, occupy, operate or use any buildings, improvements, fixtures or
equipment in connection with the Property constructed or to be constructed
by reason of any applicable environmental laws, rules or regulations.
Seller represents and warrants that Seller has no knowledge of any oil,
toxic or hazardous substances or solid wastes having been disposed of or
released on the Property other than in connection with the normal
operations of an office building in a manner that is in compliance with all
applicable laws, rules or regulations pertaining to health or the
environment, or any asbestos within the improvements.
14.11 The address set forth below is Seller's true and correct
residence, and Seller has no present intention of becoming a resident of
any other state or jurisdiction.
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14.12 Seller is the sole beneficial, legal, and record owner of the
Property.
14.13 Except as otherwise set forth herein, Seller has full power,
authority, and legal right to sell the Property.
14.14 There are no claims, liens, or other encumbrances on the
Property except for Permitted Title Exceptions and the Mortgage.
14.15 This Agreement constitutes a legal and binding obligation of
Seller, and is valid and enforceable against Seller in accordance with its
terms.
14.16 There are no other restrictions on Seller's right or ability to
sell the Property to Purchaser, except the Mortgage.
14.17 Seller has furnished Purchaser with true and complete copies of
the audited Statement of Assets and Liabilities for the Property as of
December 31, 1998 and the Property's audited statement of operations for
the year ended December 31, 1998 (the "Property Financial Statements"). The
Property Financial Statements were prepared in accordance with Seller's
books and records and in accordance with generally accepted accounting
principles applied on a consistent basis throughout the periods indicated
and fairly present the financial position of the Property as of the dates
and for the periods indicated.
On or before three business days prior to the Closing Date, Seller
shall furnish Purchaser with an unaudited Statement of Assets and
Liabilities for the Property as of the last day of the month ended
immediately prior to the third business day prior to Closing and an
unaudited income statement for the period beginning on January 1, 1999 and
ending on the last day of the month immediately prior to the third business
day prior to Closing (the "Property Updated Financial Statements"). The
Property Updated Financial Statements have been or will be prepared in
accordance with Seller's books and records and in accordance with generally
accepted accounting principles applied on a consistent basis throughout the
periods indicated, subject to normal year-end adjustments. Seller has no
reason to believe that such adjustments, other than normal year-end
adjustments to depreciation and amortization, will be substantially in
excess of adjustments in prior years relative to the volume and nature of
operations for each of those years. The Property Updated Financial
Statements in all material respects fairly present the financial position
of the Property, as of the dates and for the periods indicated. There are
no material liabilities known to Seller (whether accrued, absolute,
contingent or otherwise) which are not described, shown or provided for in
the financial statements referred to in this section or otherwise in this
Agreement except those arising since the respective dates of the Property
Updated Financial Statements in the ordinary course of Seller's business.
Seller further represents that as of the Closing, the Property Updated
Financial Statements will not vary from the Property Financial Statements
in any material respect. If there is a material change in the Property
Updated Financial Statements from the Property Financial Statements, this
Agreement may be terminated by Purchaser by notice to Seller.
14.18 Seller understands that Purchaser Shares and Adjustment Shares
have not been registered under federal or state securities laws and are
"restricted" securities as defined in Rule 144 under the Securities Act of
1933, as amended (the "Act"). Seller understands that Seller may not sell,
offer for sale, transfer, pledge or hypothecate Purchaser Shares and
13
Adjustment Shares in the absence of an effective registration statement
covering that transaction, under all applicable federal and state
securities laws, unless that transaction is exempt from registration under
all applicable federal and state securities laws, including an exemption
under Rule 144 promulgated under the Act. Seller acknowledges that the
distribution described in Section 20.8 will comply with all such applicable
federal and state securities laws. Seller and each transferee of Purchaser
Shares and Adjustment Shares pursuant to Section 20.8 shall sign and
deliver to Purchaser a Subscription Agreement and Registration Rights
Agreement in the form of Exhibit E attached to and made a part of this
Agreement concerning their respective acquisition of Purchaser Shares and
Adjustment Shares.
The foregoing representations and warranties are true and accurate as of
the date hereof, shall be true and accurate as of the Closing, and shall
survive the Closing for a period of twenty-four (24) months after the later
of the Closing Date or termination of the Management Agreement referred to
in Section 20.2 ("Survival Date"), except for the representations and
warranties set forth in Sections 14.1, 14.4 and 14.5, which shall survive.
Seller further agrees to notify Purchaser immediately in writing if any of
the foregoing representations or warranties herein are breached or are no
longer accurate at any time prior to and including Closing.
15. Representations And Warranties By Purchaser. Purchaser hereby
represents and warrants to Seller that the following are true and correct as of
the date of the execution of this Agreement and that the following shall be true
and correct as of the Closing:
15.1 Purchaser is duly organized, validly existing, and in good
standing under the laws of the state of Delaware and has the power and
authority to carry on its business, and to enter into this Agreement and
the transactions contemplated hereby.
15.2 The authorized capital stock of Purchaser consists of 10,000,000
common shares, of which 1,658,770 shares are issues and outstanding. All of
the Purchaser Shares and Adjustment Shares are validly authorized and, upon
issuance to Seller and Seller's partners, will be validly issued, fully
paid and non-assessable. Except for the above shares and as disclosed in
the Annual Report on Form 10-KSB for the year ended December 31, 1998 ,
there is no outstanding capital stock, and there are no outstanding rights,
options, calls, subscriptions, warrants, agreements or commitments of any
character relating to, nor any outstanding securities convertible into, the
issued or unissued capital stock of Purchaser. No holder of Purchaser's
shares is entitled to preemptive rights. Other than (i) the quarterly
dividend of $.12 per share declared on March 10, 1999 with a record date of
March 31, 1999 and a payment date of April 14, 1999, and (ii) the quarterly
dividend in an amount not to exceed $.13 per share planned to be declared
in June 1999 with a record date in June or July 1999 and a payment date in
July 1999, since December 31, 1998, Seller has not declared or paid any
dividend on, or declared or made any distribution of, or authorized the
creation or issuance of, or authorized or effected any split or any
recapitalization of, any of its capital stock, or directly or indirectly
redeemed, purchased or otherwise acquired any of its shares. There are no
outstanding contractual obligations of Purchaser to repurchase, redeem or
otherwise acquire any shares of Purchaser's capital stock.
15.3 Except as previously disclosed to Seller, there are no actions,
suits, investigations, or proceedings at law or in equity by or before any
court, governmental instrumentality, commission, or other agency now
14
pending or threatened or against or affecting Purchaser (or any of its
subsidiaries or related entities) or any of Purchaser's properties or
rights, before any court, arbitrator, or administrative or governmental
body which may result in an adverse change in Purchaser's business or its
condition, financial or otherwise. Further, Purchaser is not in default
with respect to any order, writ, injunction, or decree of any court or any
governmental agency or department.
15.4 Except for the requirement that the issuance of Purchaser Shares
and the Adjustment Shares be approved by Purchaser's stockholders as
contemplated by Section 8.9 of this Agreement, Purchaser has full power,
authority and legal right to execute and deliver and to perform and observe
the provisions hereof and of the transactions contemplated hereby.
Purchaser is not in default in the performance of any obligation, covenant
or condition in any agreement, decree, or order to which Purchaser is party
or by which Purchaser is bound or to which any of Purchaser's property is
subject. Purchaser is not a party to a contract or agreement or subject to
any articles of incorporation or other corporate restriction which
adversely affects Purchaser's business, property, assets or financial
condition. Purchaser is not a party to or otherwise subject to any contract
or agreement which restricts or otherwise affects Purchaser's right or
ability to undertake the transactions contemplated hereby or the
performance of any of its respective terms.
15.5 The Purchaser's execution of this Agreement has been duly
authorized and will not violate any provision of law or certificate of
incorporation or corporate bylaws or any other agreement previously entered
into.
15.6 Neither this Agreement nor any other document, certificate, or
statement furnished to Seller by Purchaser or any director, officer,
employee, or affiliate of Purchaser, or to the best knowledge of Purchaser,
by any third party, in connection with the transactions contemplated
hereby, contains any untrue statement of material fact or omits to state a
material fact necessary in order to make the statements contained herein
and therein not misleading.
15.7 No consent, approval, authorization, permit or license from any
federal, state, or local regulatory authority is required in connection
with the transactions contemplated herein.
15.8 To the best knowledge of Purchaser, there are no existing
violations of any applicable provision of (i) federal laws or regulations
applicable to the business of Purchaser such as, but not limited to, those
relating to government contracting, employment practices, occupational
safety and health, environmental protection, toxic substances, securities
regulation or otherwise, or (ii) any provision of any comparable state,
local or foreign laws or regulations. During the past three years,
Purchaser has not been charged with any violation of any law or regulation
relating to its business practices, employment practices, safety or working
conditions or other federal or state regulation.
15.9 At the time the proxy statement is mailed to the shareholders of
Purchaser, at the time of the shareholders' meeting and on the Closing Date
the proxy statement (i) will comply as to form in all material respects
with the provisions of the Securities Exchange Act of 1934 and the rules
and regulations promulgated thereunder, and (ii) will not contain any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading;
provided, however, that Purchaser makes no representation or warranty with
respect to information contained in the proxy statement furnished in
writing to Purchaser by Seller or Seller's partners or a Designee (as
defined in Section 20.6).
15
15.10 Except as otherwise provided in this Agreement or in the
Corporate Information, from the date of the filing with the SEC of
Purchaser's latest periodic report pursuant to the Exchange Act through the
execution date of this Agreement, there has been no material adverse change
in the condition of Purchaser or in the business, results of operations,
assets, net worth, prospects, properties, litigation or the manner of
conducting the business of Purchaser ("business and operations"), other
than changes in the ordinary course of business and other than changes that
might result from general business or economic conditions, such as internet
rate levels, that are in the public domain. At all times from and after the
execution date of this Agreement and through the Closing and Closing Date,
Seller shall be kept fully advised with respect to the business and
operations of Purchaser. Seller has and shall continue to have access (in
the manner and subject to the limitations herein provided) to the books and
records of Purchaser and all material changes, if any, in the business and
operations of Purchaser have been and shall have been reviewed with Seller.
15.11 Each director and officer of Purchaser shall represent and
warrant that he is not aware of any action taken individually or by
Purchaser which could cause any of Purchaser's representations or
warranties herein to be untrue as of the date of the Closing or the Closing
Date.
The foregoing representations and warranties are true and accurate as of
the date hereof, shall be true and accurate as of the Closing, and shall survive
the Closing. Purchaser further agrees to notify Seller immediately in writing if
any of the representations or warranties herein are breached or are no longer
accurate at any time prior to and including the Closing.
16. Opinion Of Counsel. At the Closing, the Purchaser shall receive from
Seller an opinion, addressed to the Purchaser, of Wallack, Somers & Haas, PC,
Indianapolis, Indiana, counsel to Seller, that as of the Closing:
16.1 Seller has been duly formed and organized as a limited
partnership and is validly existing and in good standing under the laws of
the State of Delaware. Seller is duly qualified and licensed as a limited
partnership authorized to do business in the State of Indiana and, to the
best of such counsel's knowledge, the State of Indiana is the only
jurisdiction in which the failure to qualify would have a materially
adverse effect on the operations of Seller or the Property.
16.2 Seller's execution of this Agreement has been duly authorized and
will not violate any provision of the Certificate of Limited Partnership or
Partnership Agreement of Seller.
16.3 This Agreement, when executed and delivered by Seller, will be
valid and binding on Seller and enforceable in accordance with its terms,
except that (i) the enforcement of certain rights and remedies created by
this Agreement is subject to bankruptcy, insolvency, reorganization and
similar laws of general application affecting the rights and remedies of
parties, (ii) the enforceability of any particular provision of this
Agreement under principles of equity or the availability of equitable
remedies, such as specific performance, injunctive relief, waiver or other
equitable remedies is subject to the discretion of courts of competent
jurisdiction, and (iii) any court or administrative body may refuse to
enforce the indemnification provisions of this Agreement.
16
In rendering its opinion, counsel may rely as to factual matters on
certificates of public officials and officers or employees of Seller provided
that copies of such opinions and certificates shall be delivered with such
opinion, provided further that in the case of any such reliance, counsel shall
state that it believes that it is justified in relying on such opinions and
certificates for such matters.
17. Opinion of Counsel. At the Closing, Seller shall receive from Purchaser
an opinion, addressed to Seller, of Patton Boggs LLP, counsel to Purchaser, that
as of the Closing:
17.1 Purchaser has been duly formed and organized as a corporation and
is validly existing and in good standing under the laws of the State of
Delaware.
17.2 The authorized capital stock of Purchasers consists of 10,000,000
shares of Common Stock, of which 1,658,770 shares are issued and
outstanding. All of the Purchaser Shares and Adjustment Shares are validly
authorized and, upon issuance to Seller and Seller's partners in accordance
with the terms of this Agreement, will be validly issued, fully paid and
non-assessable. To the best of such counsel's knowledge, except for the
Purchaser Shares and Adjustment Shares and as disclosed in the Annual
Report on Form 10-KSB for the year ended December 31, 1998, there is no
outstanding capital stock, and there are no outstanding rights, options,
calls, subscriptions, warrants, agreements or commitments of any character
relating to, or any outstanding securities convertible into, the issued or
unissued capital stock of Purchaser. No holder of Purchaser's shares is
entitled to preemptive rights. To the best of such counsel's knowledge,
other than the dividend of $.12 per share declared on March 10, 1999 with a
record date of March 31, 1999 and a payment date of April 14, 1999, since
December 31, 1998, Seller has not declared or paid any dividend on, or
declared or made any distribution of, or authorized the creation or
issuance of, or authorized or effected any split or any recapitalization
of, any of its capital stock, or directly or indirectly regained, purchased
or otherwise acquired any of its shares. To the best of such counsel's
knowledge, there are no outstanding contractual obligations of Purchaser to
repurchase, redeem or otherwise acquire any shares of Purchaser's capital
stock.
17.3 Seller's execution of this Agreement has been duly authorized and
will not violate any provision of the Certificate of Incorporation or
Bylaws of Purchaser.
17.4 This Agreement, when executed and delivered by Purchaser, will be
valid and binding on Purchaser and enforceable in accordance with its
terms, except that (i) the enforcement of certain rights and remedies
created by this Agreement is subject to bankruptcy, insolvency,
reorganization and similar laws of general application effecting the rights
and remedies of parties, (ii) the enforceability of any particular
provision of this Agreement under principles of equity or the availability
of equitable remedies, such as specific performance, injunctive relief,
waiver or other equitable remedies is subject to the discretion of courts
of competent jurisdiction, and (iii) any court or administrative body may
refuse to enforce the indemnification provisions of this Agreement.
In rendering its opinion, counsel may rely as to factual matters on
certificates of public officials and officers or employees of Seller provided
that copies of such opinions and certificates shall be delivered with such
17
opinion, provided further that in the case of any such reliance, counsel shall
state that it believes that it is justified in relying on such opinions and
certificates for such matters.
18. Default. If Seller fails to comply with this Agreement for any reason,
Purchaser may either enforce specific performance, terminate this Agreement or
seek such other relief as may be provided by law. If Purchaser fails to comply
with this Agreement for any reason, Seller may terminate this Agreement or seek
such other relief as may be provided by law. In any action to enforce this
Agreement or for other relief provided by law, the prevailing Party shall be
entitled to such attorneys' fees and expenses as may be allowed by the court,
arbitrator or other judicial body.
19. Commission. Seller agrees and represents that no sales fees or sales
commissions will be due or payable to anyone by Seller with respect to the
transaction contemplated by this Agreement. Purchaser agrees and represents that
no sales fees or sales commissions will be due or payable to anyone by Purchaser
with respect to the transaction contemplated by this Agreement.
20. Indemnity Agreements. Purchaser hereby agrees to indemnify and hold
harmless Seller and Seller's officers, directors, employees and agents against
any loss, injury, damage, claim, lien, cost or expense, including reasonable
attorneys' fees, arising because of a breach by Purchaser of any lease, breach
by Purchaser of any contract, breach by Purchaser of this Agreement or of any
representations or warranties included in this Agreement, a claim by any broker
that it represented Purchaser or is otherwise entitled to compensation in
connection with this Agreement or with the sale of the Property, or any other
matter related to the Property which occurs after the Closing. Seller hereby
agrees to indemnify and hold harmless Purchaser and its officers, directors,
employees and agents against any loss, damage, claim, lien, cost or expense,
including reasonable attorneys' fees, arising out of a breach by Seller of any
lease, breach by Seller of any contract, breach by Seller of this Agreement or
of any representations or warranties included in this Agreement or the breach by
Seller of any agreement, representation or warranty included in any document
delivered by or on behalf of Seller in connection with this Agreement, a claim
by any broker that it represented Seller or is otherwise entitled to
compensation in connection with this Agreement or with the sale of the Property,
or any other matter related to the Property which occurs prior to the Closing.
21. Additional Agreements.
21.1 Registration Rights.
21.1.1 AmeriVest will, no later than 45 days after the Closing
Date, file with the SEC a registration statement on Form S-3 or other
appropriate Form under the Securities Act of 1933, as amended (the
"1933 Act") including such amendments as may be necessary, registering
the transfer of Purchaser Shares and any Adjustment Shares by the
partners of Seller and the shareholders of the general partner of
Seller or by Seller (the "Selling Stockholders") to parties not
related to Seller. Purchaser shall use reasonable diligence to cause
the registration statement to become effective and to remain effective
for a period ending two years after the Closing Date or such earlier
period as all Purchaser Shares and Adjustment Shares shall have been
sold to third parties by the partners of Seller.
21.1.2 As to the registration statement, Purchaser's obligations
contained in this Section 21.1 shall be conditioned upon timely
receipt by Purchaser in writing of information as to the terms of the
contemplated transfer to be registered furnished by and on behalf of
the Selling Stockholders and such other information as Purchaser or
18
the managing underwriter, if any, reasonably may require from such
person or any underwriter for any shares of the Common Stock for
inclusion in the registration statement. Such information shall be
provided to Purchaser in writing within 10 days after the request for
that information by Purchaser.
21.1.3 All registration expenses incurred by Purchaser in
connection with the registration, qualification or compliance pursuant
to this Section 21.1, including reasonable printing expenses, fees and
disbursements of Purchaser's counsel, and registration and filing fees
relating to shares of Common Stock to be registered on behalf of
Purchaser or Selling Stockholders pursuant to the registration
statement required to be filed by Purchaser on behalf of the Selling
Stockholders pursuant to this Section 21.1, shall be borne by
Purchaser. All selling expenses, including commissions and brokers' or
investment bankers' expense allowances allocable to Purchaser Shares
and Adjustment Shares and the costs of counsel, if any, for the
Selling Stockholders pursuant to the registration, shall be borne by
the Selling Stockholders.
21.1.4 In the case of the registration, qualification or
compliance effected by Purchaser on behalf of the Selling Stockholders
pursuant to this Section 21.1, Purchaser shall keep the Selling
Stockholders advised in writing as to the initiation of such
registration, qualification, and compliance and as to the completion
thereof. At its expense, Purchaser will keep such registration,
qualification or compliance effective for a period ending two years
after the Closing Date or until the Selling Stockholders have
completed the distribution described in the registration statement
relating thereto, whichever first occurs. At its expense, Purchaser
shall furnish such number of prospectuses and other documents incident
thereto as the Selling Stockholders from time to time may reasonably
request.
21.1.5 In connection with the registration, qualification or
compliance effected by Purchaser on behalf of the Selling Stockholders
pursuant to this Section 21.1, Purchaser shall use its best efforts to
register and qualify the securities covered by such registration
statement under such other securities or blue sky laws of such
jurisdictions as Seller or the Selling Stockholders may reasonably
request that allow registration by coordination and to do any and all
other acts and things which may be necessary or advisable to enable
the Selling Stockholders to complete such proposed sale or other
distribution of Purchaser Shares and Adjustment Shares in any such
jurisdiction; provided however, that in no event shall Purchaser be
obligated to register or qualify under the blue sky laws of any
jurisdiction which would require Purchaser to qualify to do business
or to file a general consent to service of process in any jurisdiction
where it shall not then be qualified.
21.1.6 In connection with any registration, qualification or
compliance pursuant to this Section 21.1, Purchaser and Seller agree
to the following indemnification terms:
(a) Without limitation of any other indemnity provided to
Seller, to the extent permitted by law, Purchaser shall indemnify
and hold harmless Seller and each Selling Stockholder, Seller's
affiliates, employees, partners and counsel, any underwriter (as
defined in the U.S. Securities Act of 1933, as amended (the
"Securities Act")) for the Selling Stockholders, and each person,
if any, who controls the underwriter (within the meaning of the
Securities Act or the U.S. Securities Exchange Act of 1934 (the
"Exchange Act")), against any losses, claims, damages or
19
liabilities (joint or several) to which they may become subject
under the Securities Act, the Exchange Act or other federal or
state law, insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based upon
any of the following statements, omissions or violations
(collectively a "Violation"): (i) any untrue statement or alleged
untrue statement of a material fact contained in such
registration statement including any preliminary prospectus or
final prospectus contained therein or any amendments or
supplements thereto, (ii) the omission or alleged omission to
state therein a material fact required to be stated therein, or
necessary to make the statements therein in light of the
circumstances in which they were made not misleading, (iii) any
violation or alleged violation by Purchaser of the Securities
Act, the Exchange Act, or any state securities law or any rule or
regulation promulgated under the Securities Act, the Exchange Act
or any state securities law, and Purchaser shall reimburse Seller
and each Selling Stockholder and each affiliate, employee,
partner, counsel of Seller, underwriter or controlling person for
any legal or other expenses incurred by them in connection with
investigating or defending any such loss, claim, damage,
liability or action; provided, however, that Purchaser shall not
be liable hereunder in any such case for any such loss, claim,
damage, liability or action to the extent that it arises out of,
or is based upon, a violation which occurs in reliance upon and
in conformity with information furnished expressly for use in
connection with such registration by Seller or any Selling
Stockholder or any other affiliate, employee, partner, counsel or
controlling person thereof. Individual Selling Stockholders shall
be liable solely for information provided by them and not for
information provided by other Selling Stockholders.
(b) Insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based upon
any untrue statements of a material fact contained in any such
registration statement based upon (i) information provided by
such person to Purchaser specifically for inclusion therein in
connection with the offer or sale of Purchaser Shares and
Adjustment Shares, or (ii) any violation or alleged violation by
such person of any federal or state securities law or any
regulation promulgated under any federal or state securities law,
each Selling Stockholder shall, if securities held by such
Selling Stockholder pursuant to the registration statement are
included in such registration, to the extent permitted by law,
indemnify and hold harmless Purchaser, its affiliates, its
counsel, officers, directors, shareholders, any underwriter (as
defined in the Securities Act) and each person, if any, who
controls Purchaser or the underwriter (within the meaning of the
Securities Act) against any losses, claims, damages or
liabilities to which they may become subject under the Securities
Act, the Exchange Act or any state securities law, and each
Selling Stockholder shall reimburse each of Purchaser and such
affiliate, officer or director or partner, underwriter or
controlling person for any legal or other expenses reasonably
incurred by them in connection with investigating or defending
any such loss, claim, damage, liability or action.
(c) Promptly after receipt by an indemnified party under
this Section 21.1.6 of notice of the commencement of any action
(including any governmental action), such indemnified party
shall, if a claim in respect thereof is to be made against any
20
indemnifying party under this Section 21.1.6, deliver to the
indemnifying party a written notice of the commencement thereof
and the indemnifying party shall have the right to participate in
the defense thereof, and if the indemnifying party agrees in
writing that it will be responsible for any costs, expenses,
judgments, damages and losses incurred by the indemnified party
with respect to such claim, jointly with any other indemnifying
party similarly noticed, to assume the defense thereof with
counsel mutually satisfactory to the parties; provided, however,
that an indemnified party shall have the right to retain its own
counsel, with the reasonable fees and expenses to be paid by the
indemnifying party, if the indemnified party reasonably believes
that representation of such indemnified party by the counsel
retained by the indemnifying party would be inappropriate due to
actual or potential differing interests between such indemnified
party and any other party represented by such counsel in such
proceeding. The failure to deliver written notice to the
indemnifying party within a reasonable time of the commencement
of any such action shall relieve such indemnifying party of any
liability to the indemnified party under this Agreement only if
and to the extent that such failure is materially prejudicial to
its ability to defend such action, and the omission so to deliver
written notice to the indemnifying party will not relieve it of
any liability that it may have to any indemnified party otherwise
than under this Agreement.
(d) If the indemnification provided for in this Agreement is
held by a court of competent jurisdiction to be unavailable to an
indemnified party with respect to any loss, liability, claim,
damage or expense referred to therein, then the indemnifying
party, in lieu of indemnifying such indemnified party thereunder,
shall contribute to the amount paid or payable by such
indemnified party as a result of such loss, liability, claim,
damage or expense in such proportion as is appropriate to reflect
the relevant fault of the indemnifying party on the one hand and
the indemnified party on the other hand in connection with the
statements or omissions which resulted in such loss, liability,
claim, damage or expenses as well as any other relevant equitable
considerations. The relevant fault of the indemnifying party and
the indemnified party shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a
material fact or the omission to state a material fact relates to
information supplied by the indemnifying party or by the
indemnified party and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such
statement or omission.
(e) The indemnification provided by this Agreement shall be
a continuing right to indemnification and shall survive the
registration and sale of Purchaser Shares and Adjustment Shares
by any person entitled to indemnification hereunder and the
expiration or termination of this Agreement.
21.1.7 With a view to making available to the Selling
Stockholders the benefits of Rule 144 and any other rule or regulation
of the SEC that may at any time permit a Selling Stockholder to sell
securities of Purchaser to the public without registration, Purchaser
agrees to use its best efforts to: (i) make and keep public
information available, as those terms are understood and defined in
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Rule 144, at all time subsequent to the Closing Date; (ii) file with
the SEC in a timely manner all reports and other documents required of
Purchaser under the Securities Act and the Exchange Act; (iii) furnish
to any Selling Stockholder so long as such person owns any of
Purchaser Shares or Adjustment Shares forthwith upon request a copy of
the most recent annual or quarterly report of Purchaser, and such
other reports and documents so filed by Purchaser as may be reasonably
requested in availing the holder of any rule or regulation of the SEC
permitting the selling of any such securities without registration.
21.2 Property Management, Continuing Operations and Approvals.
Sheridan Development, LLC shall serve as property manager for the Property
for a management fee equal to five percent of the gross rents from the
Property pursuant to the terms of the Management Agreement attached to and
made a part of this Agreement as Exhibit F. Until the Closing, Seller shall
(i) continue its normal maintenance and repairs of the Property; (ii)
continue to operate and manage the Property in a manner consistent with
Seller's past and usual practice; (iii) without the approval of Purchaser,
not make or enter into any new leases or modifications thereof or any new
contracts for the maintenance, service, management or repair of the
Property which are not terminable with 30 days or less prior written
notice; (iv) use reasonable and customary efforts to collect all rents
which are due and payable as of the Closing; and (v) use reasonable efforts
to comply with Seller's obligations under the leases and contracts.
Notwithstanding the foregoing, unless otherwise required by the terms of
the leases, Seller shall not be required to undertake any substantial
repairs, renovations or capital improvements to the Property, except those
repairs, renovations or capital requirements required by law in which case
Seller may terminate this Agreement by giving written notice to Purchaser
setting forth in reasonable detail the reasons for the termination if the
cost of those repairs, renovations or capital improvements exceed $25,000
in the aggregate. Any contract or agreement, including leases and
modifications thereof, requiring Purchaser's approval shall be sent to
Purchaser with a written request for approval together with any other
information relating to the requested approval. Purchaser shall respond to
Seller's request for approval within three (3) business days after the
delivery of the request. Unless Purchaser delivers written notice to Seller
approving the proposed agreement within three (3) business days, Purchaser
shall be deemed to have disapproved such agreement and Seller may not enter
into such lease, contract or agreement in the form previously delivered to
Purchaser.
21.3 Right Of First Refusal Concerning ROFR Parcel. After the Closing,
Purchaser shall have a first right to purchase and a right of first refusal
to purchase the ROFR Parcel as follows: if Seller desires to sell the ROFR
Parcel, Seller shall first present Purchaser with a written offer setting
forth the material terms pursuant to which it is willing to sell the ROFR
Parcel. Within 30 days after receipt of this offer, Purchaser shall notify
Seller if it wishes to accept this offer. If Purchaser does not accept this
offer, then Seller may proceed to offer the property to others, provided
that if Seller receives a bona fide written offer, including a letter of
intent ("Offer") signed by a third party that desires to purchase the ROFR
Parcel, then Seller shall deliver a copy of the Offer to Purchaser, and
Purchaser shall have 10 days thereafter to deliver written notice to Seller
that Purchaser desires to purchase the ROFR Parcel on the same terms and
conditions as those set forth in the Offer. If Purchaser delivers written
notice within this time period, then Seller shall sell the ROFR Parcel to
Purchaser on the terms set forth in the Offer together with such other
terms and conditions that would be considered standard in a transaction of
this nature. If Purchaser does not deliver written notice within the stated
time period, then Seller may proceed to sell the ROFR Parcel on the terms
and conditions set forth in the Offer, together with the same "standard"
other terms and conditions that Seller requested of Purchaser, to the party
22
that submitted the Offer. If Seller does not consummate the purchase of the
ROFR Parcel on those terms and conditions set forth within 90 days after
the first to occur of 90 days after the date scheduled for closing in the
Offer or six months after expiration of Purchaser's time period for giving
notice of exercise of its right of first refusal, then Seller may not sell
the ROFR Parcel without recommencing the procedures set forth herein.
Notwithstanding the foregoing, if Purchaser exercises its right of first
refusal or accepts Seller's offer to sell pursuant to the terms of this
paragraph, and Purchaser fails to consummate the acquisition because of
Purchaser's financial or other inability to close the acquisition or
because of Purchaser's lack of good faith, or Purchaser otherwise elects
not to close, provided that any such failure or inability of Purchaser to
close, or election of Purchaser not to close, is not because of Seller's
lack of good faith or other inability to consummate the transaction, and it
is not because of newly discovered adverse information concerning the
Property, then Purchaser's first right of purchase and right of first
refusal shall terminate.
21.4 Confidential Information; Inside Information; Publicity
21.4.1 Information Confidential And Not For Competitive Or Other
Use. Each Party acknowledges that the information provided to that
Party concerning the other Party pursuant to this Agreement
(collectively, the "Information") may include proprietary information
and data, interpretations, innovative processes, trade secrets,
marketing plans, and confidential or specialized data and/or other
information relative to the business and proposed business of the
other Party. " Information" shall not include any information which is
publicly available. Each Party (the "Receiving Party") agrees and
covenants with and unto the other Party (the "Disclosing Party") that
the Receiving Party will use the Information solely to evaluate the
Receiving Party's consummation of the transactions contemplated by
this Agreement. Without limiting the foregoing, except as specifically
authorized in writing by the Disclosing Party or as required by law
(including court order) or applicable federal securities regulations,
in which latter event the Receiving Party will immediately notify the
Disclosing Party of the requirement and reasonably assist the
Disclosing Party in contesting that requirement if requested by the
Disclosing Party, the Receiving Party will not use any Information for
the Receiving Party's or any other person's or entity's benefit,
including in any manner or for any purpose competitive with the
business of the Disclosing Party, and the Receiving Party will not, at
any time, disclose any of the Information to any other person, firm,
corporation or other entity without the written consent of the
Disclosing Party, except for reasonable disclosure made by the
Receiving Party to its employees, consultants, limited partners,
accountants or banks and only after such recipient agrees to be bound
by the terms of this Section 21.4.
21.4.2 Inside Information. Certain of the Information that
Purchaser may furnish to Seller and certain of Seller's
representatives may be material information concerning Purchaser and
its operations that has not been included in publicly filed documents
or otherwise been publicly disclosed (the "Non-Public Information").
Unless the information provided to Seller consists of or has been
specifically included in a periodic report filed with the SEC, a press
release, marketing materials, or otherwise has been made publicly
available otherwise than by Seller, that information shall be
considered Non-Public Information. Seller agrees, and shall cause each
of Seller's representatives who receives such Non-Public Information,
to maintain the confidentiality of the Non-Public Information. Seller
acknowledges that the Purchaser is a corporation that is subject to
the reporting requirements of the Exchange Act and whose common stock
is traded publicly. In this regard, Seller recognizes that applicable
U.S. federal securities laws impose significant restrictions
concerning the use or disclosure of the Non-Public Information in
general and in buying or selling, or discussing with others the
23
possibility of buying or selling, Purchaser's securities by persons
who have access to Non-Public Information concerning Purchaser that is
not generally available to members of the general public. Seller
acknowledges that the Non-Public Information may be considered
material non-public information that constitutes "inside information"
under the U.S. federal securities laws. By virtue of its access to the
Non-Public Information, Seller and its representatives will be subject
to these restrictions. Seller agrees that it will not, and that it
will use its best efforts to ensure that any person having access to
such Non-Public Information through it, including without limitation
partners of Seller, will not buy or sell Purchaser's securities, or
discuss with others any Non-Public Information concerning Purchaser or
the possibility or advisability of buying or selling Purchaser's
securities, at any time that the respective Investor possesses
Non-Public Information concerning Purchaser. Seller agrees to disclose
any Non-Public Information obtained by it only to representatives of
Seller and only if each recipient of the Non-Public Information first
agrees that he or she will abide by the provisions of this Section
21.4. Seller and Purchaser hereby confirm that any information
disclosed to Seller, or any discussions held between Seller and
Purchaser, prior to the date of this Agreement shall be subject to the
terms of this Section 21.4.
21.4.3 Responsibility For Recipients Of Information. Each
Receiving Party shall be responsible and liable to the Disclosing
Party for the failure of the Receiving Party or any other person
receiving the Information from the Receiving Party to comply with any
of the provisions of this Section 21.4.
21.4.4 Publicity. All notices to third parties and all other
publicity concerning the transactions contemplated by this Agreement
shall be directed by Purchaser after consultation with Seller.
Notwithstanding anything to the contrary in this Section, any Party to
this Agreement shall be permitted unilaterally to make such notices
and to engage in such publicity as it reasonably deems necessary to
comply with applicable laws and regulations, including its respective
reporting obligations, if any, under the 1934 Act. The provisions of
this Section shall remain in effect only until the earlier to occur of
the Closing or the termination of this Agreement.
21.5 Cooperation Concerning Financial Statements And Taxes. After the
Closing Date, each of the Parties shall cooperate, and cause its respective
directors, employees, officers and representatives to cooperate, with the
others and with each other's respective agents, including accounting firms
and legal counsel, in connection with the preparation or audit of any
financial statements, tax return or report, amended return or report,
periodic report or proxy or information statement required to be filed with
the SEC, claim for refund in any tax claim or litigation in respect of any
of the parties, or the Property or their respective activities, which
cooperation shall include, but not be limited to, making available to the
other all information, records, and documents in their possession relating
to the Property, except as may be limited by this Agreement. Each of the
Parties also shall make available to the others, as reasonably requested
and available, the personnel responsible for preparing, maintaining and
interpreting information, records and documents in connection with
financial statements and taxes of Seller or related to the Property as well
as related litigation. Any information provided or obtained pursuant to
Section 21.5 shall be kept confidential, except as may be otherwise
necessary in connection with the filing of periodic reports required under
the Exchange Act, other disclosure requirements of Purchaser, or of returns
or reports, refund claims, audits, tax claims and litigation.
21.6 Appointment Of Directors. Immediately after the Closing,
Purchaser shall cause two designees (the "Designees") of Seller, who shall
be reasonably acceptable to Purchaser, to be elected directors of Purchaser
in such classes as are available for new directors in accordance with
Purchaser's Bylaws. If, pursuant to Purchaser's Bylaws, the Designees are
to serve in separate classes, Seller may designate which Designee shall
24
serve in which class. If not previously elected to Purchaser's Board of
Directors, the initial Designees shall be entitled to attend meetings of
Purchaser's Board of Directors commencing on the date this Agreement is
signed by both Parties and continuing until this Agreement is terminated.
21.7 Additional Documents; Further Assurances. In addition to the
schedules and other items specifically required to be furnished hereunder,
the Parties hereby agree that each will promptly furnish to the other such
further schedules, certificates and other instruments and take such other
action as may reasonably be requested in order to effectuate the purposes
of this Agreement.
21.8 Distribution Of Shares; Lock-Up. Purchaser Shares and Adjustment
Shares to be issued as consideration for the purchase hereunder shall be
distributed to the partners of Seller upon receipt, subject to the
requirements of all applicable federal and state securities laws. This
distribution will be structured to result in compliance by Seller and by
all partners of Seller with Article V, Section 9 of Purchaser's Bylaws, as
amended, with respect to the number of shares of Purchaser's stock that are
deemed to be owned by any person or entity. Prior to transferring Purchaser
Shares and Adjustment Shares on Purchaser's stock transfer records,
Purchaser may require evidence of compliance with applicable federal and
state securities laws and Purchaser's Bylaws, including appropriate
representation or subscription agreements signed by each transferee of
Purchaser Shares and Adjustment Shares, which subscription agreements shall
be substantially in the form of D to and made a part of this Agreement.
Notwithstanding the foregoing, neither Seller nor any partner of Seller may
sell, offer for sale, transfer, pledge or hypothecate in any manner
Purchaser Shares prior to the first anniversary of the Closing Date without
Purchaser's written consent, which consent may be withheld by Purchaser in
Purchaser's sole discretion.
22. Notices. All notices, requests, demands, directions and other
communications ("Notices") concerning this Agreement shall be in writing and
shall be mailed or delivered personally or sent by telecopier or facsimile to
the applicable Party at the address of such Party set forth below in this
Section 22. When mailed, each such Notice shall be sent by first class by first
class, certified mail, return receipt requested, enclosed in a postage prepaid
wrapper, and shall be effective on the fifth business day after it has been
deposited in the mail. When delivered personally, each such Notice shall be
effective when delivered to the address for the respective Party set forth in
this Section 22, provided that it is delivered on a business day and further
provided that it is delivered prior to 5:00 p.m., local time of the Party to
whom the notice is being delivered, on that business day; otherwise, each such
Notice shall be effective on the first business day occurring after the Notice
is delivered. When sent by telecopier or facsimile, each such Notice shall be
effective on the day on which it is sent provided that it is sent on a business
day and further provided that it is sent prior to 5:00 p.m., local time of the
Party to whom the Notice is being sent, on that business day; otherwise, each
such Notice shall be effective on the first business day occurring after the
Notice is sent. Each such Notice shall be addressed to the Party to be notified
as shown below:
To Purchaser:
AmeriVest Properties Inc.
c/o James F. Etter
2801 Youngfield
Suite 300
Golden Colorado 80401
Facsimile: (303) 235-0124
25
To Seller:
Sheridan Realty Partners, L.P.
c/o Sheridan Realty Corp., General Partner
1800 Glenarm Place, Suite 500
Denver, Colorado 80202
Facsimile: (303) 296-7353
Attn: Charles K. Knight
Either Party may change its respective address for purposes of this Section
22 by giving the other Party Notice of the new address in the manner set forth
above.
23. Entire Agreement. This Agreement, together with the exhibits attached
hereto, all of which are incorporated by reference, is the entire agreement
between the parties with respect to the subject matter hereof, and no
alteration, modification or interpretation hereof shall be binding unless in
writing and signed by both parties.
24. Severability. If any provision of this Agreement or application to any
party or circumstances shall be determined by any court of competent
jurisdiction to be invalid and unenforceable to any extent, the remainder of
this Agreement or the application of such provision to such person or
circumstances, other than those as to which it is so determined invalid or
unenforceable, shall not be affected thereby, and each provision hereof shall be
valid and shall be enforced to the fullest extent permitted by law.
25. Captions. The captions in this Agreement are inserted only as a matter
of convenience and for reference and in no way define, limit or describe the
scope of this Agreement or the scope or content of any of its provisions.
26. Time Of Essence. Time is of the essence in this Agreement.
27. Counterparts; Facsimile Signatures. This Agreement may be executed and
delivered in any number of counterparts, each of which so executed and delivered
shall be deemed to be an original and all of which shall constitute one and the
same instrument. Facsimile signatures shall be as binding as original
signatures.
28. Recordation. Seller and Purchaser agree not to record this Agreement or
any memorandum hereof.
29. Parties In Interest; Survival; Assignment. This Agreement shall be
binding upon and inure to the benefit of and be enforceable by the respective
successors and assigns of Seller and Purchaser. All representations, covenants,
and agreements in this Agreement or any statement, certificate, or other
document delivered in connection with this Agreement or pursuant hereto shall
survive the Closing except as specifically limited herein. This Agreement may
not be assigned by either Party without the prior written consent of the other
Party hereto, except that Purchaser may assign this Agreement to a wholly-owned
subsidiary of the Purchaser in which event Purchaser shall continue to be
obligated to issue the Purchaser Shares and Adjustment Shares, if any are
required to be issued, and to register the Registrable Securities in accordance
with the terms of this Agreement.
26
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed
by their duly authorized officers or representatives on the dates set forth
below to be effective as of the date set forth on the first page of this
Agreement.
SHERIDAN REALTY PARTNERS, L.P AMERIVEST PROPERTIES INC.
a Delaware limited partnership a Delaware corporation
By: Sheridan Realty Corp., General Partner
By: /s/ William T. Atkins By: /s/ James F. Etter
-------------------------------- ----------------------------
Signature James F. Etter
President
William T. Atkins, President
- ------------------------------------
Printed Name and Title
27
PURCHASE AND SALE AGREEMENT
Dated April 26, 1999
Between Sheridan Realty Partners, L.P. and
AmeriVest Properties Inc.
EXHIBIT INDEX
Exhibit Description
- ------- -----------
A Legal Description
B Leases and Tenancies
C Insurance Policies
D Form of Estoppel Letter
E Subscription and Registration Rights Agreement
F Management Agreement
28