SALE-PURCHASE AGREEMENT
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AND JOINT ESCROW INSTRUCTIONS
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SALE-PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS (this "AGREEMENT"),
made as of December 8, 2000, between WELLSFORD CAPITAL PROPERTIES, L.L.C., a
Delaware limited liability company having an address c/o Wellsford Real
Properties, Inc., 535 Madison Avenue, 26th Floor New York, New York 10022
("SELLER") and DIAL ADVISORY GROUP, INC., a Nebraska corporation having an
office at 11506 Nicholes Street, Suite 200, Omaha, Nebraska 68154 ("PURCHASER").
W I T N E S S E T H:
- - - - - - - - - -
Seller and Purchaser, in consideration of the mutual covenants herein
contained, hereby agree as follows:
ARTICLE 1. CERTAIN DEFINITIONS
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For purposes of this Agreement, the following terms shall have the
following meanings:
1.1. "Affiliate" shall mean, with respect to any specified Person, any
other Person that directly or indirectly, through one or more intermediaries,
controls, is controlled by, or is under common control with the specified
Person. For purposes of this definition, the term (i) "Person" means an
individual, corporation, limited liability company, partnership, joint venture,
association, joint stock company, trust, unincorporated organization or
government or any agency or subdivision thereof and (ii) the term
"controls"(including, with correlative meanings, the terms "controlled by" and
"under common control with") means the ownership, directly or indirectly, of
more than fifty percent (50%) of the beneficial interests in a Person, together
with the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through ownership
of voting stock, by contract or otherwise.
1.2. "Broker" shall mean Grubb & Ellis Company.
1.3. "Business Day" shall mean any day other than a Saturday, Sunday or any
day upon which banks in the States of California or New York are required or
authorized by law to be closed.
1.4. "Escrowee" shall mean Commerce Escrow Company.
1.5. "Existing Leases" shall mean the leases, licenses and occupancy
agreements set forth in Exhibit C annexed hereto.
1.6. "Existing Service Contracts" shall mean the service contracts,
maintenance agreements, brokerage agreements and other agreements affecting the
Property and set forth in Exhibit D annexed hereto.
1.7. "Invasive Tests" shall mean any physical inspection or testing of the
Premises other than visual examination, and shall include, without limitation,
sampling of soils or other media.
1.8. "Leases" shall mean the Existing Leases and the New Leases in effect
on the Closing Date.
1.9. "Leasing Costs" shall mean, collectively, (i) leasing or brokerage
commissions, (ii) direct payments, tenant improvement allowances, work letters
or free rent and (iii) rent allowances or rent credits, in each case paid or
granted to a tenant under an Existing Lease or a New Lease.
1.10. "New Leases" shall mean any new leases, licenses or occupancy
agreements entered into by Seller in accordance with the terms of this
Agreement.
1.11. "New Service Contracts" shall mean any service contracts, maintenance
agreements, brokerage agreements or other agreements entered into by Seller in
accordance with the terms of this Agreement.
1.12. "Service Contracts" shall mean the Existing Service Contracts and the
New Service Contracts in effect on the Closing Date.
1.13. "Title Exceptions" shall mean any lien, encumbrance, security
interest, charge, reservation, lease, tenancy, easement, right-of-way,
encroachment, restrictive covenant, condition or limitation affecting the
Premises.
1.14. "Title Insurer" shall mean Commonwealth Land Title Insurance Company.
1.15. "Violations" shall mean any violation of any law or municipal
ordinance, order or requirement noted or issued against the Premises by any
federal, state or municipal department having jurisdiction.
ARTICLE 2. SALE-PURCHASE OF PROPERTY
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2.1. Agreement to Sell and Purchase. Seller shall sell to Purchaser, and
Purchaser shall purchase from Seller, at the Purchase Price and upon the terms
and conditions set forth in this Agreement, the following (collectively, the
"PROPERTY"): (a) all of Seller's right, title and interest as lessee under that
certain Joint Occupancy Lease more particularly described in Exhibit A annexed
hereto (the "GROUND LEASE"), demising certain real property more particularly
described in Exhibit B annexed hereto (the "LAND") and the improvements thereon
(the "IMPROVEMENTS") (the Land and the Improvements, collectively, the
"PREMISES"); (b) all of Seller's right, title and interest in and to any
appurtenances to the Land; (c) all right, title and interest of Seller in and to
any furniture, furnishings, moveable equipment and other personal property
located at, and used in connection with, the Premises (herein collectively
called the "PERSONAL PROPERTY"); (d) Seller's right, title and interest in and
to the Leases; (e) to the extent assignable, Seller's right, title and interest
in and to the Service Contracts; and (f) to the extent assignable, Seller's
right, title and interest in and to any licenses and permits used or useful in
the operation of the Premises (collectively, the "LICENSES AND PERMITS"). The
Premises are located at, and are commonly known, as 1651 Sixteenth Street, Santa
Monica, California (the "16TH STREET PREMISES") and 900 Colorado Avenue, Santa
Monica, California (the "COLORADO AVENUE PREMISES").
2.2. Condition of Property. Purchaser is a sophisticated investor and its
valuation of and decision to purchase the Property is based upon its own
independent expert evaluations of such facts and materials deemed relevant by
Purchaser and its agents. Other than the express representations and warranties
of Seller specifically set forth herein, Purchaser has not relied upon any oral
or written information from Seller or its employees, affiliates, agents,
consultants, advisors or representatives, including, without limitation, any
appraisals, projections or evaluations of credit quality prepared by Seller or
any of its employees, affiliates, agents, consultants, advisors or
representatives. Purchaser further acknowledges that no employee, agent,
consultant, advisor or representative of Seller has been authorized to make, and
that Purchaser has not relied upon, any statements or representations other than
those specifically contained in this Agreement. Without limiting the generality
of the foregoing, Purchaser acknowledges and agrees that, except as expressly
set forth herein, Purchaser is purchasing the Property "as is" and "where is" on
the Closing Date, and, except as expressly set forth herein, Seller is making no
representation or warranty, express or implied, and Purchaser has not relied on
any representation or warranty, express or implied, regarding the Property,
including, without limitation, any representation or warranty with respect to
(a) the business or financial condition of any tenant of the Property, (b) the
physical condition of any Improvement or Personal Property comprising all or a
part of any Property, or its fitness, merchantability or suitability for any use
or purpose, (c) the leases, rents, income or expenses of the Property, (d) the
compliance or non-compliance with any laws, codes, ordinances, rules or
regulations of any governmental authority (including, without limitation, laws
pertaining to hazardous materials) or (e) the current or future use of the
Property, including, but not limited to, any Property's use for commercial,
retail, industrial or other purposes. Seller is not liable or bound in any
manner by any verbal or written statements, representations, real estate
brokers' "set-ups", offering memoranda or information pertaining to the Property
furnished by any real estate broker, advisor, consultant, agent, employee,
representative or other person.
ARTICLE 3. PURCHASE PRICE
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3.1. Purchase Price. The purchase price (the "PURCHASE PRICE") for the
Property shall be SIXTEEN MILLION FIVE HUNDRED FIFTY THOUSAND AND 00/100 DOLLARS
($16,550,000.00), net of adjustments made in accordance with Article 6 below.
The entire Purchase Price shall be allocated to Seller's interest in the
Premises. The Purchase Price shall be paid by Purchaser as follows:
(a) On or before the date which is two (2) Business Days after the
Opening of Escrow (hereinafter defined), Purchaser shall deposit into the
Escrow (hereinafter defined) Two Hundred Fifty Thousand and 00/00 Dollars
($250,000.00) (the "DEPOSIT"). The Deposit shall be paid by (i) wire
transfer of immediately available funds to the account of Escrowee, (ii)
Purchaser's check, subject to collection or (iii) an unconditional,
irrevocable letter of credit naming Escrowee as beneficiary, issued by a
United States bank having total assets in excess of $100,000,000 and
otherwise in form reasonably acceptable to Seller (the "LETTER OF CREDIT").
The Deposit shall be held by Escrowee in accordance with the terms of
Section 3.3 hereof.
(b) On or before 1:00 p.m. (California time) on the Business Day
immediately preceding the Closing Date (hereinafter defined), Purchaser
shall, in accordance with the terms of Section 3.2(d) hereof, deposit into
the Escrow immediately available funds in an amount which, when added to
the Deposit, will equal the Purchase Price, net of adjustments made in
accordance with the terms of Article 6 hereof and costs chargeable to the
account of Purchaser ("CLOSING PAYMENT").
3.2. Escrow Instructions.
(a) On or before the date which is two Business Days after Seller and
Purchaser have mutually executed and delivered this Agreement, the parties
shall open an escrow (the "ESCROW") with Escrowee in order to consummate
the purchase and sale of the Property in accordance with the terms and
provisions hereof. This Agreement shall be deposited in the Escrow and the
provisions hereof shall constitute joint primary escrow instructions to
Escrowee. The "OPENING OF ESCROW" shall be deemed to have occurred upon the
later to occur of Escrowee's receipt of (i) the Deposit and (ii) fully
executed counterparts of this Agreement. Notwithstanding the fact that this
Agreement is executed by Seller and Purchaser, this Agreement shall not be
binding or enforceable prior to the Opening of Escrow. Promptly following
the occurrence thereof, Escrowee shall furnish Seller and Purchaser with
written confirmation of the date of the Opening of Escrow.
(b) Prior to the Closing Date but not, in any event, until after
Purchaser has performed its obligations under Sections 3.2(c) and (d)
hereof, Seller shall deposit the following into Escrow:
(i) An assignment and assumption of the Ground Lease (the
"ASSIGNMENT OF GROUND Lease"), duly executed and acknowledged by
Seller, in the form of Exhibit E annexed hereto;
(ii) a statement of documentary transfer tax (the "STATEMENT OF
TRANSFER TAX") for attachment to the Assignment of Ground Lease, duly
executed by Seller;
(iii) Three (3) original counterparts of a bill of sale for the
Personal Property (the "BILL OF SALE"), duly executed by Seller, in
the form of Exhibit G annexed hereto;
(iv) Three (3) original counterparts of an assignment and
assumption of the Leases (the "ASSIGNMENT OF LEASES"), duly executed
by Seller, in the form of Exhibit H annexed hereto;
(v) Three (3) original counterparts of an assignment and
assumption of the assignable Service Contracts and the assignable
Licenses and Permits (the "ASSIGNMENT OF SERVICE CONTRACTS, LICENSES
AND Permits"), duly executed by Seller, in the form of Exhibit I
annexed hereto;
(vi) Three (3) original counterparts of an affidavit by Seller in
satisfaction of the requirements of Section 1445 of the Internal
Revenue Code, as amended (the "SECTION 1445 AFFIDAVIT"), duly executed
by Seller;
(vii) Three (3) original counterparts of a Withholding Exemption
Certificate stating that Seller is exempt from California withholding
requirements ("FORM 597W"), duly executed by Seller;
(viii) One original counterpart of a notice letter to the lessor
under the Ground Lease, duly executed by Seller, (the "GROUND LEASE
NOTICE");
(ix) Original counterparts of notice letters addressed to each of
the tenants under the Leases (the "LEASE NOTICES"), duly executed by
Seller;
(x) One original counterpart of the Ground Lease (or, if the same
is not available, a copy thereof, certified by Seller to be true,
complete and correct);
(xi) One original counterpart of each of the Leases (or, if the
same are unavailable, copies thereof, certified by Seller to be true,
complete and correct);
(xii) One original counterpart of each of the Service Contracts
assigned to Purchaser (or, if the same are unavailable, copies
thereof, certified by Seller to be true, complete and correct);
(xiii) One original counterpart of the Ground Lease Estoppel
Certificate;
(xiv) One original counterpart of each of the Tenant Estoppel
Certificates (and, if applicable, the Seller's Estoppel Certificate)
(each as hereinafter defined);
(xv) Three (3) original counterparts of an instrument pursuant to
which Seller (i) remakes the representations made by Seller in Section
7.3(a) - (g) hereof as of the Closing Date and (ii) advises Purchaser
of any facts or circumstances which would render any of such
representations, as made as of the Closing Date, untrue;
(xvi) One (1) original counterpart of appropriate authorizing
documents evidencing that Seller has the authority to enter into this
Agreement, carry out the terms of this Agreement and sell the Property
and evidencing that the individual or individuals executing this
Agreement on behalf of Seller and any other documents contemplated
hereunder or related hereto have the authority to so execute such
documents; and
(xvii) Such other instruments and documents as may be reasonably
required by Escrowee to close the Escrow.
(c) At least two (2) Business Days prior to the Closing Date,
Purchaser shall deposit into Escrow the following:
(i) One (1) original counterpart of the Assignment of Ground
Lease, duly executed and acknowledged by Purchaser;
(ii) Three (3) original counterparts of the Assignment of Leases,
duly executed by Purchaser;
(iii) Three (3) original counterparts of the Assignment of
Service Contracts, Licenses and Permits duly executed by Purchaser;
(iv) One original counterpart of the Ground Lease Notice, duly
executed by Purchaser;
(v) One original counterpart of each of the Lease Notices, duly
executed by Purchaser;
(vi) One original counterpart of appropriate authorizing
documents evidencing that Purchaser has the authority to enter into
this Agreement, carry out the terms of this Agreement and purchase the
Property and evidencing that the individual or individuals executing
this Agreement on behalf of Purchaser and any other documents
contemplated hereunder or related hereto have the authority to so
execute such documents; and
(vii) Such other instruments and documents as may be reasonably
required by Escrowee to close the Escrow.
(d) On or before 1:00 p.m. (California time) on the Business Day
immediately preceding the Closing Date, Purchaser shall deposit into the
Escrow immediately available funds in the amount of the Closing Payment.
(e) Escrow shall not close unless and until the following conditions
precedent and contingencies have been satisfied or waived in writing by the
party for whose benefit the conditions have been included:
(i) Each of the conditions to Closing set forth in Article 5
hereof shall have been either satisfied or waived in writing by the
party for whose benefit such conditions run;
(ii) Escrowee shall be in possession of all funds, documents and
instruments to be deposited into Escrow in accordance with the
provisions of Sections 3.2(b) through (d) hereof; and
(iii) The Title Insurer shall be prepared to issue to Purchaser
the Title Policy (hereinafter defined).
(f) Upon satisfaction of the conditions set forth in Section 3.2(e)
above, Escrowee shall close the Escrow, i.e., perform each of the following
acts in exactly the following order the occurrence of which shall
constitute the "Close of Escrow":
(i) Cause the Ground Lease Assignment to be recorded in the
Official Records of Los Angeles County, California;
(ii) Deliver to Purchaser two fully executed counterparts of the
Section 1445 Affidavit, the Bill of Sale, the Assignment of Leases,
the Assignment of Service Contracts, Licenses and Permits, the
Statement of Transfer Tax and Form 597W and one conformed copy of the
recorded Assignment of Ground Lease;
(iii) Deliver to Purchaser the original counterparts, or copies,
as the case may be, of the Ground Lease, the Leases, the Service
Contracts, the Ground Lease Estoppel Certificate, the Tenant Estoppel
Certificates and (if applicable) the Seller Estoppel Certificate;
(iv) Deliver to Seller one fully executed counterpart of the
Section 1445 Affidavit, the Bill of Sale, the Assignment of Leases,
the Assignment of Service Contracts, Licenses and Permits, the
Statement of Transfer Tax and Form 597W and one conformed copy of the
recorded Assignment of Ground Lease; and
(v) Disburse to Seller the Deposit and the Closing Payment, less
the amount of any costs chargeable to the account of Seller; provided,
however, that if Purchaser, in lieu of a cash deposit, posts the
Letter of Credit with Escrowee in accordance with the provisions of
Section 3.1(a) hereof, Escrowee is hereby authorized and directed by
Seller and Purchaser upon the Close of Escrow to draw upon the full
amount of the Letter of Credit and pay the proceeds thereof, together
with the Closing Payment (less any costs chargeable to the account of
Seller) to Seller.
3.3. Deposit in Escrow.
(a) Escrowee shall hold the Deposit in the Escrow until the Close of
Escrow or sooner termination of this Agreement. Any interest earned on the
Deposit shall be paid to the same party entitled to be paid the Deposit
hereunder (as and when such party is entitled to the Deposit), and the
party receiving such interest shall pay any income taxes thereon. For
purposes thereof, the tax identification numbers of the parties are as
follows: 13-4027757 (Seller); and 47-0700015 (Purchaser).
(b) If this Agreement is validly terminated by Purchaser in accordance
with the provisions of Section 4.1 hereof, the Deposit shall be refunded to
Purchaser.
(c) At the Close of Escrow, the Deposit shall be paid by Escrowee to
Seller in accordance with the provisions of Section 3.2(f) above.
(d) If Purchaser posts the Letter of Credit with Escrowee in lieu of a
cash deposit, Escrowee is hereby unconditionally and irrevocably authorized
and directed by Seller and Purchaser to draw upon the full amount of the
same (x) in the event that either Seller or Purchaser becomes entitled to
disbursement of the Deposit in accordance with the terms hereof, whereupon
the proceeds thereof shall be paid to the party so entitled and (y) in the
event Purchaser fails to renew the Letter of Credit (or substitute a
replacement irrevocable, unconditional letter of credit therefor, issued by
a bank with not less than $100,000,000 in assets and otherwise in form
reasonably acceptable to Seller) two (2) days prior to any expiration date
set forth therein, whereupon Escrowee shall hold the proceeds thereof in
Escrow in accordance with the provisions of this Section 3.3.
(e) If for any reason the Close of Escrow does not occur, Escrowee
shall continue to hold the Deposit until otherwise directed by joint
written instructions from the parties to this Agreement or a final judgment
of a court of competent jurisdiction. Escrowee, however, shall have the
right at any time to deposit the Deposit with the clerk of any federal or
state court sitting in Los Angeles County. Escrowee shall give written
notice of such deposit to Seller and Purchaser. Upon
such deposit, Escrowee shall be relieved and discharged of all further
obligations and responsibilities hereunder.
(f) The parties acknowledge that Escrowee is acting solely as a
stakeholder at their request and for their convenience, that Escrowee shall
not be deemed to be the agent of either of the parties, and that Escrowee
shall not be liable to either of the parties for any act or omission on its
part unless taken or suffered in bad faith, in willful disregard of this
Agreement or involving gross negligence. Seller and Purchaser shall jointly
and severally indemnify and hold Escrowee harmless from and against all
costs, claims and expenses, including reasonable attorneys' fees, incurred
in connection with the performance of Escrowee's duties hereunder, except
with respect to actions or omissions taken or suffered by Escrowee in bad
faith, in willful disregard of this Agreement or involving gross negligence
on the part of Escrowee.
(g) Upon any delivery of the Deposit as provided in Sections 3.2(b),
(c) or (d) above, Escrowee shall be relieved of all liability,
responsibility or obligation with respect to or arising out of the Deposit.
(h) Escrowee shall be entitled to rely or act upon any notice,
instrument or document believed by Escrowee to be genuine and to be
executed and delivered by the proper person, and shall have no obligation
to verify any statements contained in any notice, instrument or document or
the accuracy or due authorization of the execution of any notice,
instrument or document.
3.4. Costs of Escrow. Costs of the Escrow shall be allocated as follows:
(a) Seller shall at the Close of Escrow pay for (i) transfer taxes
payable to the State of California, the City of Santa Monica and the County
of Los Angeles, (ii) premiums, charges and fees payable to Title Insurer in
connection with the Title Policy to be delivered to Purchaser hereunder,
(iii) the cost of updating the Surveys (hereinafter defined), (iv)
recording fees required to discharge any Title Exception which is not a
Permitted Exception (hereinafter defined), and (v) one-half of the escrow
fees payable to Escrowee.
(b) Purchaser shall at the Close of Escrow pay (i) recording fees for
the recording of the Assignment of Ground Lease and (ii) one-half of the
escrow fees payable to Escrowee.
(c) Except as otherwise provided herein, any other costs incurred
through the escrow shall be apportioned in the manner customary in escrows
of Escrowee in Los Angeles County, California.
(d) If the Close of Escrow fails to occur by reason of Purchaser's
exercise of its due diligence contingency in accordance with the terms of
Section 4.1 hereof, Purchaser and Seller shall each be responsible for
one-half of all fees payable to Escrowee in connection with the Escrow,
including, without limitation, cancellation fees. If the Close of Escrow
fails to occur by reason of the default of one of the parties hereto or the
failure of a condition precedent to Closing, escrow fees payable to
Escrowee (including escrow cancellation fees) shall be borne by the
defaulting party or the party who failed to satisfy the condition in the
other party's favor. If the Close of Escrow fails to occur for any reason
other than Purchaser's exercise of its due diligence contingency, a default
by
either party hereto or a failure of condition, escrow fees payable to
Escrowee shall be borne equally by Seller and Purchaser.
3.5. Acknowledgment by Escrowee. Escrowee has acknowledged agreement to the
provisions of Sections 3.2 and 3.3 above by signing in the place indicated on
the signature page of this Agreement.
ARTICLE 4. INSPECTION
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4.1. Due Diligence Period; Termination Right. During the period (the "DUE
DILIGENCE PERIOD") commencing on the Opening of Escrow and ending on December
15, 2000 (the "DUE DILIGENCE EXPIRATION DATE"), Purchaser shall have the right
to conduct such due diligence as it deems reasonably necessary or appropriate in
connection with its acquisition of the Property, including inspections, studies,
examinations and investigations of, or with respect to, the Property, or any
portion thereof, and/or any facts, circumstances and matters relating to the
Property, or any portion thereof. If Purchaser, in its sole discretion,
determines that it is unsatisfied with the results of and matters disclosed by
its due diligence, Purchaser shall have the right to terminate this Agreement by
written notice given to Seller prior to 5:00 p.m. New York time on the Due
Diligence Expiration Date (TIME BEING OF THE ESSENCE). Upon any termination of
this Agreement pursuant to this Section 4.1, the Escrow shall be terminated,
whereupon the Deposit shall be refunded to Purchaser and neither party hereto
shall have any further obligation to the other, with the exception of those
obligations which expressly survive the termination of this Agreement. If
Purchaser shall fail to terminate this Agreement in the time and manner set
forth in this Section 4.1, Purchaser shall be deemed to have irrevocably waived
its right to terminate this Agreement pursuant to this Section 4.1
4.2. Inspections. Purchaser and its authorized agents, consultants or
representatives shall have the right, upon reasonable prior notice to Seller
(which notice may be telephonic), to enter upon the Premises from time to time
to conduct such physical and other inspections as Purchaser deems appropriate,
provided that Purchaser shall not perform Invasive Tests or interview tenants of
the Premises without first obtaining Seller's consent, which consent shall not
be unreasonably withheld, and provided further that Purchaser's investigations
shall be subject to the rights of tenants and shall not materially interfere
with Seller's operation of the Property. Prior to any entrance upon the Premises
for the performance of Invasive Tests, Purchaser shall deliver to Seller a
certificate of insurance evidencing that Purchaser has procured and maintains in
force and effect a comprehensive general liability insurance policy covering
Purchaser and Seller against claims for bodily injury or death or property
damage occurring in, upon or about the Premises in an amount of not less than
$2,000,000 (combined single limit), issued by an insurance company with a rating
of "A-" or better as established by Best's Rating Guide. Such insurance shall
include blanket contractual liability coverage and shall otherwise be in form
reasonably acceptable to Seller. Following the performance of any Invasive
Tests, Purchaser shall restore the Premises to their condition prior to the
performance thereof. Purchaser shall indemnify, hold harmless and defend Seller
and its officers, directors, members, employees, successors and assigns, from
and against any and all damages, losses, costs, expenses, liabilities, claims,
actions or proceedings which arise out of or in any way relate to the conduct of
its due diligence investigations. The provisions of this Section 4.2 shall
survive the termination of this Agreement.
4.3. Confidentiality. Prior to the Close of Escrow, Purchaser shall not
disclose to any other party either the contents of any materials delivered to
Purchaser by Seller with respect to the Property or the results of any reports
summarizing any aspect of Purchaser's due diligence investigations without first
obtaining the prior written consent of Seller. Notwithstanding the foregoing,
Purchaser may, without first obtaining such prior written consent, make such
disclosures as it deems appropriate to its officers, employees, lenders,
counsel, lenders' counsel, appraisers, accountants, insurance advisors,
environmental consultants and similar third-party consultants, provided that
such parties are apprised of the confidential nature of the material disclosed.
The provisions of this Section 4.3 shall survive the termination of this
Agreement.
ARTICLE 5. CLOSING DATE; CONDITIONS TO CLOSING
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5.1. Closing Date. The Close of Escrow shall occur on January 2, 2001 (the
"CLOSING DATE"). TIME SHALL BE OF THE ESSENCE WITH RESPECT TO THE OBLIGATIONS OF
PURCHASER TO BE PERFORMED ON THE CLOSING DATE.
5.2. Purchaser's Conditions. Purchaser's obligation to purchase the
Property is subject to the satisfaction of the following conditions precedent,
any or all of which may be waived by Purchaser:
(a) Seller shall have deposited into the Escrow an estoppel
certificate, duly executed by the lessor under the Ground Lease, in
substantially the form of Exhibit M annexed hereto (the "GROUND LEASE
ESTOPPEL CERTIFICATE");
(b) Seller shall have deposited into the Escrow Tenant Estoppel
Certificates, dated as of a date subsequent to the date of this Agreement,
from the holders of the tenant's interest under Leases which demise not
less than 100% of the rentable square footage demised as of the date hereof
under the Leases (other than the G. Ray Hawkins Lease, as defined in
Exhibit C annexed hereto). If, however, Seller obtains Tenant Estoppel
Certificates from the holders of the tenant's interest under Leases equal
to at least 70%, but less than 100%, of the rentable square footage demised
under the Leases as of the date hereof (other than the G. Ray Hawkins
Lease), Seller may (but shall not be obligated to) satisfy the foregoing
condition by executing and delivering into the Escrow a certificate from
Seller ("SELLER'S ESTOPPEL CERTIFICATE") setting forth the matters which
would have been set forth in Tenant Estoppel Certificate(s) for any Leases
selected by Seller and for which Seller has been unable to obtain a Tenant
Estoppel Certificate, to the extent necessary to increase to 100% of the
rentable square footage demised under Leases as of the date hereof (other
than the G. Ray Hawkins Lease) for which a Tenant Estoppel Certificate has
been obtained. Not withstanding the foregoing, Seller's Estoppel
Certificate may not pertain to the Direct Partners Lease or the Santa
Monica - Malibu School District Lease (each as defined in Exhibit C annexed
hereto). Any Seller's Estoppel Certificate shall state that the
representations made therein shall survive the Close of Escrow for a period
of one year or until such earlier date on which the applicable tenant shall
deliver to Purchaser a Tenant Estoppel Certificate. For purposes of this
Agreement, the term "TENANT ESTOPPEL CERTIFICATE" shall mean a certificate
substantially in the form of Exhibit N annexed hereto, provided that if any
Lease prescribes the form or contents of an estoppel certificate to be
delivered by the tenant, "TENANT ESTOPPEL CERTIFICATE" shall mean an
estoppel certificate in such form or containing such contents. To satisfy
the condition set forth in this Section 5.2(b), a
Tenant Estoppel Certificate (i) may not materially contradict any of the
representations of Seller made in Sections 7.3(b) or (c) hereof and (ii)
may not allege a material default by the landlord under the Lease;
(c) Seller's representations contained in Sections 7.3(a) - (g) hereof
shall be true, complete and correct in all material respects, as made as of
the date hereof and as of the Closing Date. Notwithstanding the foregoing,
if any representation made by Seller in Section 7.3(a) - (g) hereof is not
true, complete and correct in all material respects as of the Closing Date
by reason of any state of facts which is permitted or contemplated by this
Agreement, such as Seller's entrance into a New Lease or termination of an
Existing Lease or New Lease in accordance with the terms of this Agreement,
then there shall be no failure of the condition set forth in this Section
5.2(c) by reason thereof. In addition, if any representation made by Seller
in Section 7.3(a) - (g) hereof is not true, complete and correct in all
material respects as of the Closing Date, there shall be no failure of the
condition set forth in this Section 5.2(c) unless Purchaser is able
reasonably to demonstrate that such failure of condition results in a
diminution of the value of the Property which exceeds $50,000.
(d) (i) this Agreement shall be in full force and effect, (ii) Seller
shall have fully satisfied, or shall therewith fully satisfy, all of the
obligations of Seller to be performed on the Close of Escrow and (iii)
there shall not otherwise then exist any event which would allow Purchaser
to terminate this Agreement pursuant to the express terms hereof.
5.3. Seller's Conditions. Seller's obligation to sell the Property is
subject to the satisfaction of the following conditions precedent, any or all of
which may be waived by Seller:
(a) Purchaser's representations contained in Section 7.1 hereof shall
be true, complete and correct in all material respects, as made as of the
date hereof and as of the Closing Date; and
(b) (i) This Agreement shall be in full force and effect, (ii)
Purchaser shall have fully satisfied, or shall therewith fully satisfy, all
of the obligations of Purchaser to be performed on the Close of Escrow, and
(iii) there shall not otherwise then exist any event which would allow
Seller to terminate this Agreement pursuant to the express terms hereof.
5.4. Failure of Condition Not a Breach. The parties hereto acknowledge and
agree that the failure to occur of one or more conditions precedent contained in
this Article 5 shall not be deemed to constitute a breach of this Agreement by
either party unless and to the extent that any such party shall have expressly
agreed or covenanted or is otherwise expressly obligated hereunder to take any
action to satisfy or cause the satisfaction of the condition in question.
ARTICLE 6. CLOSING ADJUSTMENTS
------------------------------
The following are to be adjusted and prorated between Seller and Purchaser
as of 11:59 p.m. on the day preceding the Closing Date, based upon a 365 day
year and the actual number of days elapsed, with Seller deemed to be the owner
of the Property on the day preceding the Closing Date and Purchaser deemed to be
the owner of the Property on the Closing Date.
6.1. Fixed Rents.
(a) Fixed rents (collectively, "FIXED RENTS") paid or payable by
tenants under the Leases in connection with their occupancy of the Premises
shall be adjusted and prorated on an if, as and when collected basis. Any
Fixed Rents collected by Purchaser or Seller after the Closing Date from
any tenant who owes Fixed Rents for periods prior to the Closing Date shall
be applied (i) first, in payment of Fixed Rents owed by such tenant for the
month in which the Closing Date occurs, pro rated as of the Closing Date,
(ii) second, in payment of Fixed Rents owed by such tenant for periods
subsequent to the month in which the Closing Date occurs and (iii) third,
after Fixed Rents for all current periods have been paid in full, in
payment of Fixed Rents owed by such tenant for periods prior to the month
in which the Closing Date occurs. Each such amount shall be adjusted and
prorated as provided above, and the party who receives such amount shall
promptly pay over to the other party the portion thereof to which it is so
entitled.
(b) Purchaser shall bill tenants who owe Fixed Rents for periods prior
to the Closing Date on a monthly basis for a period of six (6) consecutive
months following the Closing Date (the "PURCHASER COLLECTION Period"). If
Purchaser shall be unable during the Purchaser Collection Period to collect
such past due Fixed Rents, Seller shall have the right, upon prior written
notice to Purchaser, to pursue tenants to collect such delinquencies
(including, without limitation, the prosecution of one or more lawsuits),
but Seller shall not be entitled to evict (by summary proceedings or
otherwise) any such tenants.
(c) Any payment by a tenant in an amount less than the full amount of
Fixed Rents and Overage Rents (hereinafter defined) then due and payable by
such tenant shall be applied first to Fixed Rents (in the order of priority
as to time periods set forth in Section 6.1(a) above) to the extent of all
such Fixed Rents then due and payable by such tenant, and second to Overage
Rents, in the order of priority as to time periods set forth in Section
6.2(d) below.
6.2. Overage Rents.
(a) With respect to any Lease that provides for the payment of (i)
so-called percentage rent or additional rents which are calculated as a
percentage of the tenant's sales or gross sales (net of certain agreed-upon
deductions), (ii) so-called common area maintenance or "cam" charges, (ii)
so-called "escalation rent" or additional rent based upon increases in real
estate taxes or operating expenses or labor costs or cost of living or
otherwise (such percentage rent, cam charges, escalation rent and
additional rent being collectively called "OVERAGE RENTS"), such Overage
Rents shall be adjusted and prorated on an if, as and when collected basis.
(b) As to any Overage Rents in respect of an accounting period that
shall have expired prior to the Closing Date but which shall be payable
after the Closing Date, Purchaser agrees that it will pay the entire amount
over to Seller upon receipt thereof. Purchaser agrees that it shall (i)
promptly render bills for any Overage Rents in respect of an accounting
period that shall have expired prior to the Closing but which shall be
payable after the Closing and (ii) bill tenants such Overage Rents
attributable to an accounting period that shall have expired prior to the
Closing on a monthly basis during the Purchaser Collection Period. If
Purchaser shall be unable to collect such Overage Rents during the
Purchaser Collection Period, Seller shall have the right, upon prior
written notice to Purchaser, to pursue tenants to collect such
delinquencies (including, without limitation, the
prosecution of one or more lawsuits), but Seller shall not be entitled to
evict (by summary proceedings or otherwise) any such tenants. Seller shall
furnish Purchaser with all information relating to the period prior to the
Closing Date that is reasonably necessary for the billing of Overage Rents;
and Purchaser will deliver to Seller, concurrently with the delivery to
tenants, copies of all statements relating to Overage Rents for a period
prior to the Closing Date. Purchaser shall bill tenants for Overage Rents
for accounting periods prior to the Closing Date in accordance with and on
the basis of such information furnished by Seller.
(c) Overage Rents in respect of the accounting period in which the
Closing Date occurs shall be apportioned as of the Closing Date. If, prior
to the Closing Date, Seller shall receive any installments of Overage Rents
attributable to Overage Rents for periods from and after the Closing Date,
such sum shall be apportioned at the Closing. If, after the Closing,
Purchaser shall receive any installments of Overage Rents attributable to
Overage Rents for periods prior to the Closing Date, such sum shall be paid
by Purchaser to Seller promptly after Purchaser receives payment thereof.
(d) Any payment by a tenant on account of Overage Rents (to the extent
not applied against Fixed Rents due and payable by such tenant in
accordance with Section 6.1(c) above) shall be applied to Overage Rents
then due and payable in the following order of priority: (i) first, in
payment of Overage Rents for the accounting period subsequent to the
accounting period in which the Closing Date occurs and (ii) second, in
payment of Overage Rents for the accounting period in which the Closing
Date occurs, apportioned as of the Closing Date.
(e) To the extent that any portion of Overage Rents is required to be
paid monthly by tenants on account of estimated amounts for any calendar
year (or, if applicable, any lease year or tax year or any other applicable
accounting period), and at the end of such calendar year (or lease year,
tax year or other applicable accounting period, as the case may be), such
estimated amounts are to be recalculated based upon the actual expenses,
taxes and other relevant factors for that calendar (lease or tax) year or
other applicable accounting period, with the appropriate adjustments being
made with such tenants, then such portion of the Overage Rents shall be
prorated between Seller and Purchaser at the Close of Escrow based on such
estimated payments actually paid by tenants (i.e., with Seller entitled to
retain all monthly or other periodic installments of such amounts paid by
tenants with respect to periods prior to the calendar month or other
applicable installment period in which the Closing Date occurs, Seller to
pay to Purchaser at the Close of Escrow all monthly or other periodic
installments of such amounts theretofore received by Seller with respect to
periods following the calendar month or other applicable installment period
in which the Closing Date occurs and Seller and Purchaser to apportion as
of the Closing Date all monthly or other periodic installments of such
amounts paid by tenants with respect to the calendar month or other
applicable installment period in which the Closing Date occurs). At the
time(s) of final calculation and collection from (or refund to) each tenant
of the amounts in reconciliation of actual Overage Rents for a period for
which estimated amounts paid by such tenant have been prorated, there shall
be a re-proration between Seller and Purchaser. If, with respect to any
tenant, the recalculated Overage Rents exceeds the estimated amount paid by
such tenant, upon collection from the tenant, (i) the entire excess shall
be paid by Purchaser to Seller, if the accounting period for which such
recalculation was made expired prior to the Closing Date and (ii) such
excess shall be apportioned between Seller and Purchaser as of the Closing
Date, if the Closing Date occurred during the accounting period for which
such recalculation was made, with Purchaser paying to Seller the
portion of such excess which Seller is so entitled to receive. If, with
respect to any tenant, the recalculated Overage Rents are less than the
estimated amount paid by such tenant, (i) the entire shortfall shall be
paid by Seller to Purchaser (or, at Seller's option, directly to the tenant
in question), if the accounting period for which such recalculation was
made expired prior to the Closing Date and (ii) such shortfall shall be
apportioned between Seller and Purchaser as of the Closing Date, if the
Closing Date occurred during the accounting period for which such
recalculation was made, with Seller paying to Purchaser (or, at Seller's
option, directly to the tenant in question) the portion of such shortfall
so allocable to Seller.
(f) Until such time as all amounts required to be paid to Seller by
Purchaser pursuant to Section 6.1 and this Section 6.2 shall have been paid
in full, Purchaser shall furnish to Seller not less frequently than monthly
a reasonably detailed accounting of such amounts payable by Purchaser,
which accounting shall be delivered to Seller on the 25th day of each
calendar month from and after the calendar month in which the Closing
occurs. Seller shall have the right from time to time following the Closing
Date, on Business Days and upon reasonable prior notice to Seller, to
review Purchaser's rental records with respect to the Property to ascertain
the accuracy of such accounting.
6.3. Security Deposits. Seller shall credit against the Closing Payment the
security deposits held by Seller as landlord under the Leases (together with
accrued interest thereon, if any). Notwithstanding the foregoing, any tenant
security deposits held in a form other than cash shall be transferred to
Purchaser by way of appropriate instruments of transfer or assignment.
6.4. Real Estate Taxes. Real estate taxes shall be adjusted and prorated on
the basis of the fiscal year for which assessed. If the Close of Escrow shall
occur before the tax rate or assessed valuation is fixed for either the 16th
Street Premises or the Colorado Avenue Premises, the apportionment of real
estate taxes for such premises shall be upon the basis of the tax rate for the
preceding year applied to the most recently applicable assessed valuation of
such premises, subject to further and final adjustment when the tax rate and/or
assessed valuation for such premises is fixed for the year in which the Closing
Date occurs. In the event that either the 16th Street Premises or the Colorado
Avenue Premises shall be or shall have been affected by an assessment or
assessments, whether or not the same become payable in annual installments,
Seller shall, at the Close of Escrow, be responsible for any installments due
prior to the Closing Date and Purchaser shall be responsible for any
installments due on or after the Closing Date.
6.5. Utility Charges. Seller shall use reasonable efforts to obtain
readings of meters measuring utility consumption at the Premises (other than
utilities which are the responsibility of tenants under Leases) for all periods
through (and including) the date preceding the Closing Date. Seller shall pay,
and be responsible, for all bills rendered on the basis of such readings. If
such readings are not obtained for any metered utility, then, at the Close of
Escrow, apportionment shall be made on the basis of the most recent period for
which such readings are available. Upon the taking of subsequent actual
readings, there shall be a recalculation of the applicable utility charges, and
Seller or Purchaser, as the case may be, shall promptly remit to the other party
hereto any amounts to which such party shall be entitled by reason of such
recalculation. Unmetered water charges or sewer rents shall be apportioned on
the basis of the charges therefor for the same period during the previous
calendar year, but applying the current rate thereto. As to any utility charges
or sewer rents payable by tenants, Purchaser shall close title and accept the
Property subject to such
unpaid charges and rents and any lien resulting therefrom, without credit
against the Purchase Price or any claim or right of action against Seller by
reason thereof.
6.6. Ground Rent. Base rent and additional rent under the Ground Lease
shall be adjusted as of 11:59 p.m. on the date preceding the Closing Date.
6.7. Fuel. Fuel on hand, if any, based on an estimate provided by Seller's
fuel supplier, at Seller's cost valued at the price therefor charged by such
supplier including any applicable taxes.
6.8. Other Adjustments. The following items shall also be adjusted as of
11:59 P.M. on the date preceding the Closing Date: (i) charges and payments
under Service Contracts assigned to Purchaser; (ii) fees and payments, if any,
under Licenses and Permits assigned to Purchaser; (iii) revenues, if any,
arising out of telephone booths, vending machines, or other income-producing
agreements; and (iv) maintenance supplies in unopened containers based on
Seller's actual cost therefor, including sales and/or use tax.
6.9. Closing Statement. At the Close of Escrow, Seller and Purchaser shall
mutually execute and deliver to each other a closing statement setting forth
with reasonable specificity the apportionments made in accordance with this
Article 6.
6.10. Survival. Any errors or omissions in computing adjustments at the
Close of Escrow shall be promptly corrected, provided that the party seeking to
correct such error or omission shall have notified the other party of such error
or omission on or prior to the date that is one (1) year after the Closing Date.
ARTICLE 7. REPRESENTATIONS AND WARRANTIES
-----------------------------------------
7.1. Basic Representations of Purchaser.
Purchaser, as of the date hereof, represents and warrants to Seller as
follows:
(a) Purchaser is a corporation, duly organized, validly existing and
in good standing under the laws of the State of Nebraska.
(b) Purchaser has full power and authority to enter into and perform
this Agreement, the documents to be executed and delivered pursuant hereto,
and each and all of the transactions contemplated hereby and thereby in
accordance with the terms hereof and thereof.
(c) The individuals executing this Agreement and each of the documents
to be executed and delivered in connection herewith on behalf of Purchaser
have full power and authority to do so. This Agreement and each of the
documents to be executed and delivered by Purchaser in connection herewith
are, or will be when executed and delivered, the legal, valid and binding
obligations of Purchaser, enforceable against Purchaser in accordance with
the terms hereof and thereof.
(d) Purchaser has not filed any petition seeking or acquiescing in any
reorganization, arrangement, composition, readjustment, liquidation,
dissolution or similar relief under any law relating to bankruptcy or
insolvency, nor has any such petition been filed against
Purchaser. Purchaser is not insolvent and the consummation of the
transactions contemplated by this Agreement shall not render Purchaser
insolvent. No general assignment of Purchaser's property has been made for
the benefit of creditors, and no receiver, master, liquidator or trustee
has been appointed for Purchaser or any of its property.
(e) There are no actions or proceedings pending or, to Purchaser's
actual knowledge, threatened, against Purchaser which could have a material
adverse affect on Purchaser's ability to perform its obligations hereunder.
7.2. Basic Representations of Seller.
Seller, as of the date hereof, represents and warrants to Purchaser as
follows:
(a) Seller is a limited liability company, duly organized and validly
existing and in good standing under the laws of the State of Delaware.
(b) Seller has full power and authority to enter into and perform this
Agreement and to enter into the documents to be executed and delivered
pursuant hereto, and each and all of the transactions contemplated hereby
and thereby in accordance with the terms hereof and thereof.
(c) The individuals executing this Agreement and each of the documents
to be executed and delivered in connection herewith on behalf of Seller
have full power and authority to do so. This Agreement and each of the
documents to be executed and delivered in connection herewith are, or will
be when executed and delivered, the legal, valid and binding obligations of
Seller, enforceable against Seller in accordance with the terms hereof and
thereof.
(d) Seller has not filed any petition seeking or acquiescing in any
reorganization, arrangement, composition, readjustment, liquidation,
dissolution or similar relief under any law relating to bankruptcy or
insolvency, nor has any such petition been filed against Seller. Seller is
not insolvent and the consummation of the transactions contemplated by this
Agreement shall not render Seller insolvent. No general assignment of
Seller's property has been made for the benefit of creditors, and no
receiver, master, liquidator or trustee has been appointed for Seller or
any of its property.
(e) There are no actions or proceedings pending or, to Seller's actual
knowledge, threatened, against Seller which could have a material adverse
affect on Seller's ability to perform its obligations hereunder.
7.3. Representations of Seller Regarding the Property.
Seller, as of the date hereof, represents and warrants to Purchaser as
follows:
(a) The Ground Lease is in full force and effect and has not been
modified except as set forth in Exhibit A annexed hereto. The copy of the
Ground Lease furnished by Seller to Purchaser is true, complete and
correct. No written notice of a default on the part of Seller, as lessee
under the Ground Lease, has been received by Seller, other than a notice
which pertains to a default which, as
of the date hereof, has been cured. No written notice of a default on the
part of the lessor under the Ground Lease has been sent by Seller, other
than a notice setting forth a default which, as of the date hereof, has
been cured. To Seller's actual knowledge, neither Seller nor ground lessor
is in material default of any of the terms, covenants or conditions of the
Ground Lease. Seller has made payments of fixed rent payable under the
Ground Lease through December 31, 2000.
(b) There are no leases, licenses or occupancy agreements affecting
the Premises, other than the Ground Lease and the Existing Leases. The
Existing Leases have not been modified except as set forth in Exhibit C
annexed hereto. The copies of the Existing Leases furnished by Seller to
Purchaser are true, complete and correct. The information contained in the
rent roll annexed hereto as Exhibit O is true, complete and correct. Except
as otherwise noted in Exhibit P annexed hereto, (i) each of the Existing
Leases is in full force and effect, (ii) no written notice of a default on
the part of a tenant under any of the Existing Leases has been sent by
Seller, other than a notice setting forth a default which, as of the date
hereof, has been cured, (iii) no written notice of a default on the part of
the landlord under the Existing Leases has been received by Seller, other
than a notice setting forth a default which, as of the date hereof, has
been cured and (iv) no tenant under an Existing Lease is in arrears in the
payment of Fixed Rent or monthly installments of Overage Rent for a period
in excess of thirty days.
(c) Subject to the provisions of Section 13.6 hereof, Seller has paid
(or will on or before the Close of Escrow pay) all Leasing Costs which
pertain to the current terms of the Leases, other than Leasing Costs
payable in connection with (A) the renewal or extension of an Existing
Lease or a New Lease, the effective date of which shall not yet have
occurred on the date hereof, (B) the leasing of space pursuant to the
exercise of a right of first refusal or first offer or similar right
contained in an Existing Lease or a New Lease, the effective date of which
shall not yet have occurred on the date hereof and (C) the failure timely
to exercise any termination right set forth in an Existing Lease or a New
Lease at any time after the date hereof (any such transaction, a
"Contingent Commission Event".)
(d) There are no service contracts, brokerage agreements, maintenance
agreements or other agreements affecting the Premises, other than (i) the
Ground Lease, (ii) the Existing Leases, (ii) the Existing Service Contracts
and (iii) any service contracts which are terminable upon not more than 30
days notice without penalty or premium. The Existing Service Contracts have
not been modified except as set forth in Exhibit D annexed hereto. The
copies of the Existing Service Contracts furnished by Seller to Purchaser
are true, complete and correct.
(e) Except as disclosed on Exhibit P annexed hereto, there are no
actions or proceedings pending or, to Seller's actual knowledge,
threatened, with respect to the Property.
(f) There are no pending or, to Seller's knowledge, threatened,
eminent domain or condemnation proceedings with respect to the Property.
(g) To Seller's actual knowledge, there are no Violations which remain
uncured, other than the Violations noted on Exhibit P-1 annexed hereto.
(h) The insurance coverages with respect to the Premises described in
Exhibit Q annexed hereto are in full force and effect.
For purposes of this Section 7.3, the term "Seller's actual knowledge"
shall mean the actual knowledge of William H. Darrow. The representations of
Seller contained in Sections 7.3 (a)-(c) hereof shall survive Closing for one
year. The representations of Seller contained in Sections 7.3(d)-(g) hereof
shall survive Closing for six (6) months.
ARTICLE 8. TITLE
----------------
8.1. Acceptable Title. Seller shall convey, or cause to be conveyed, and
Purchaser shall accept, title to the Premises, at the Close of Escrow, subject
to the Permitted Exceptions. The term "PERMITTED EXCEPTIONS" shall mean,
collectively, (i) the matters set forth in Exhibit R annexed hereto, (ii) Title
Exceptions that Title Insurer shall be willing to omit as exceptions to coverage
in Purchaser's owner's policy of title insurance or any lender's policy of title
insurance obtained by Purchaser, (iii) the standard exceptions and provisions
contained in the form of insuring agreement employed by Title Insurer, other
than those standard exceptions which may be deleted by Seller's delivery to
Title Insurer of a customary and reasonable affidavit of title and (iv) any
exceptions and matters that are approved, waived or deemed to have been approved
or waived by Purchaser.
8.2. Inability to Convey Acceptable Title.
(a) Purchaser acknowledges receipt from Seller of (i) a title report
for the Premises, prepared by Title Insurer and dated October 27, 2000 (the
"TITLE REPORT"), together with copies of all of the instruments referenced
therein and (ii) a survey of the 16th Street Premises, last redated
10/08/98, prepared by Daniel P. MacNeil, Licensed Land Surveyor, and (iii)
a survey of the Colorado Avenue Premises, last redated 10/20/98, prepared
by John E. Coombs, Licensed Land Surveyor (the surveys set forth in the
foregoing clauses (ii) and (iii) are hereinafter referred to as the
"Surveys"). On or before the date which is five (5) Business Days after the
Opening of Escrow, Purchaser shall furnish Seller with updates of the
Surveys sufficient to obtain Title Insurer's agreement to delete the survey
exceptions set forth in the Title Report and substitute therefor survey
readings.
(b) Purchaser acknowledges that the Title Exceptions disclosed in the
Title Report and the Surveys and set forth in Exhibit R constitute
Permitted Exceptions. Within two (2) Business Days of Purchaser's receipt
of any supplement to the Title Report or any update of the Surveys, (TIME
BEING OF THE ESSENCE), Purchaser may furnish Seller with written notice (a
"TITLE OBJECTION NOTICE") of Title Exceptions noted therein which are not
Permitted Exceptions and as to which Purchaser objects, provided such Title
Exceptions were not noted in the Title Report or the Surveys or any prior
supplement or update thereof. Purchaser shall be deemed to have waived
objection to Title Exceptions set forth in any supplement or update of the
Title Reports or the Surveys to which timely objection is not made in a
Title Objection Notice.
8.3. Seller's Rights. Seller shall have the right, in its sole discretion,
upon notice to Purchaser (the "TITLE RESPONSE NOTICE") given within ten (10)
days after Seller's receipt of any Title Objection Notice, to either (i) take
such action as Seller deems advisable to discharge those Title Exceptions which
are not Permitted Exceptions and are set forth in a Title Objection Notice or
(ii) subject to the provisions of Section 8.4 hereof, terminate this Agreement,
whereupon the Escrow shall be terminated. Upon such termination, the Deposit
shall be refunded to Purchaser and thereafter neither party hereto shall have
any further obligation to the other party, with the exception
of those obligations which expressly survive the termination of this Agreement.
If Seller fails timely to deliver the Title Response Notice, Seller, subject to
the provisions of Section 8.4 hereof, shall be deemed to have elected to
terminate this Agreement pursuant to clause (ii) above. If Seller, in its Title
Response Notice, elects to take action to remove, remedy or comply with any
Title Exception set forth in a Title Objection Notice, Seller shall be entitled
to an adjournment or adjournments of the Close of Escrow, not to exceed thirty
(30) days in the aggregate. If Seller is unable to remove, remedy or comply with
such Title Exceptions at the expiration of such adjournment(s), then, subject to
the provisions of Section 8.4 hereof, this Agreement shall be deemed to be
terminated as of the last adjourned date of the Close of Escrow. Upon such
termination, the Deposit shall be refunded to Purchaser and neither party hereto
shall have any further obligation to the other party, with the exception of
those obligations which expressly survive the termination of this Agreement.
Except as set forth in Section 8.5 hereof, nothing in this Agreement shall be
deemed to require Seller to take or bring any action or proceeding or any other
steps to remove any defect in or objection to title or to expend any moneys
therefor, nor shall Purchaser have any right of action against Seller, at law or
in equity, therefor.
8.4. Purchaser's Right to Accept Title. Purchaser may, upon written notice
to Seller at any time on or before the Closing Date (as the same may have been
adjourned by Seller in accordance with the provisions of Section 8.3 above),
elect to accept such title as Seller can convey, notwithstanding the existence
of any Title Exceptions which are not Permitted Exceptions. In such event, (i)
this Agreement shall remain in force and effect, (ii) the parties shall proceed
to Closing and (iii) Purchaser shall not be entitled to any abatement of the
Purchase Price, any credit or allowance of any kind or any claim or right of
action against Seller for damages or otherwise by reason of the Title Defects.
8.5. Seller's Obligation. Notwithstanding anything contained in this
Article 8 to the contrary, Seller shall at or prior to the Close of Escrow
discharge (i) any mortgage or deed of trust affecting the Premises, (ii) any
Title Exception which is knowingly and intentionally created by Seller
subsequent to the date hereof or (iii) any other Title Exception which may be
discharged solely by the payment of a sum of money, not to exceed $250,000.00 in
the aggregate.
8.6. Title Affidavits, Etc.
(a) If requested by Title Insurer, Seller shall deliver (i) one or
more reasonable and customary title affidavits executed by Seller (or an
officer thereof), certifying to factual matters concerning Seller or the
Premises which are within the knowledge of Seller and (ii) documents
evidencing Seller's payment of franchise or unincorporated business taxes,
as applicable.
(b) If requested by Title Insurer, Purchaser shall deliver one or more
reasonable and customary title affidavits executed by Purchaser (or an
officer thereof), certifying to factual matters concerning Purchaser or the
Premises which are within the knowledge of Purchaser.
8.7. Title Policy. Upon the Close of Escrow, Seller shall cause Title
Insurer to issue to Purchaser an ALTA owner's policy of title insurance,
insuring Purchaser's interest in the Ground Lease subject only to the Permitted
Exceptions, with a limit of liability in the amount of the Purchase Price (the
"Title Policy"). The issuance of the Title Policy shall be in lieu of any
express or implied warranty of Seller concerning Purchaser's leasehold title.
Purchaser agrees that its only remedy arising by reason of any defect in title
shall be against the Title Company. Purchaser's acceptance of the Assignment of
Ground Lease and the issuance of the Title Policy to Purchaser shall
conclusively establish that Seller conveyed the Property to Purchaser as
required by this Agreement and shall discharge in full Seller's obligations
under this Article 8.
ARTICLE 9. CASUALTY AND CONDEMNATION
------------------------------------
9.1. Casualty.
(a) For purposes of this Article 9, the following terms shall have the
meanings indicated:
"MAJOR CASUALTY" means a fire in or other casualty to the
Improvements which causes damage or injury to the Improvements and
results in Restoration Costs in excess of $200,000.
"RESTORATION COSTS" means the cost to repair or restore (as
reasonably determined by an architect or engineer selected by Seller
and approved by Purchaser, which approval shall not be unreasonably
withheld, conditioned or delayed) the damage to the Improvements
caused by a fire or other casualty, exclusive of the cost of any such
repair or restoration for which Seller, as the landlord under any
Lease, is not responsible.
(b) If, between the date hereof and the Closing Date, there shall
occur a fire or other casualty affecting the Improvements which is not a
Major Casualty, then Purchaser shall have no right to terminate this
Agreement and shall purchase the Property in its damaged condition without
reduction of or offset against the Purchase Price or any other claim
against Seller. Seller shall assign to Purchaser the right to receive any
insurance proceeds payable to Seller as a result of such fire or other
casualty; provided, however, that Seller shall be entitled to retain (to
the extent theretofore paid to Seller), and shall not be obligated to
assign the right to receive (to the extent not theretofore paid to Seller),
an amount of such insurance proceeds equal to Seller's expenses, if any,
incurred in collecting such proceeds and repairing the damage caused by
fire or other casualty.
(c) If, between the date hereof and the Closing Date, there shall
occur a fire or other casualty affecting the Improvements which is a Major
Casualty, then Purchaser shall have the option, to be exercised by notice
given to Seller within fifteen (15) days after the date of such casualty,
to terminate this Agreement. If Purchaser shall so elect to terminate this
Agreement, the Escrow shall be terminated, whereupon the Deposit shall be
refunded to Purchaser and neither party hereto shall have any further
obligation to the other hereunder, with the exception of those obligations
which expressly survive the termination of this Agreement. If Purchaser
shall not elect to terminate this Agreement as provided in this subclause
(c), then this Agreement shall remain in full force and effect and the
provisions of Section 9.1(b) above shall apply to such damage and any
insurance proceeds payable in connection therewith.
(d) In no event shall Seller have any obligation to repair any damage
or destruction to the Improvements, but Seller shall have the right to do
so and utilize insurance proceeds for such purpose.
(e) Seller and Purchaser expressly intend that the provisions of this
Section 9.1 shall govern in the event of a fire or other casualty.
9.2. Condemnation. If, between the date hereof and the Closing Date, any
condemnation or eminent domain proceedings are initiated which would result in a
total or partial taking of the Premises, Purchaser may elect to terminate this
Agreement by giving written notice of its election to the other party within
fifteen (15) days after receiving notice of such prospective taking. If
Purchaser shall so elect to terminate this Agreement, the Escrow shall be
terminated, whereupon the Deposit shall be refunded to Purchaser, and neither
party hereto shall have any further obligation to the other hereunder, with the
exception of those obligations which expressly survive the termination of this
Agreement. If Purchaser does not so elect to terminate this Agreement, the
parties hereto shall close Escrow without reduction of or offset against the
Purchase Price and Purchaser shall have no other claim against Seller. In such
event, all of Seller's right, title and interest in and to any condemnation
proceeds paid or payable in connection therewith shall be assigned to Purchaser.
In no event shall Seller have any obligation to repair or restore the Premises
or any portion thereof by reason of any condemnation.
ARTICLE 10. DEFAULT AND REMEDIES
--------------------------------
10.1. Default By Purchaser. IF PURCHASER(I) DEFAULTS IN THE PERFORMANCE OF
ANY OF ITS OBLIGATIONS TO BE PERFORMED AT THE CLOSE OF ESCROW OR (II) OTHERWISE
MATERIALLY DEFAULTS HEREUNDER AND SUCH DEFAULT IS NOT CURED WITHIN FIVE DAYS
AFTER NOTICE THEREOF FROM SELLER TO PURCHASER, THEN SELLER MAY TERMINATE THIS
AGREEMENT, WHEREUPON THE ESCROW SHALL BE TERMINATED AND THE DEPOSIT PAID TO
SELLER AS LIQUIDATED DAMAGES ON ACCOUNT OF SUCH DEFAULT. SELLER AND PURCHASER
HEREBY ACKNOWLEDGE AND AGREE THAT THE DAMAGES TO SELLER IN THE EVENT OF
PURCHASER'S DEFAULT WOULD BE EXTREMELY DIFFICULT AND IMPRACTICABLE TO ASCERTAIN
AND THAT THE DEPOSIT IS A REASONABLE ESTIMATE OF THE DAMAGES TO SELLER IN THE
EVENT OF PURCHASER'S DEFAULT, SUCH DAMAGES INCLUDING THE COST OF PREPARING, AND
NEGOTIATING THE TERMS OF, THIS AGREEMENT, COSTS OF SATISFYING THE CONDITIONS TO
PURCHASER'S OBLIGATION TO PROCEED TO THE CLOSE OF ESCROW, COSTS OF SEEKING
ANOTHER PURCHASER UPON PURCHASER'S DEFAULT, OPPORTUNITY COSTS IN WITHDRAWING THE
PROPERTY FROM THE MARKET, AND OTHER COSTS INCURRED IN CONNECTION HEREWITH.
PURCHASER AND SELLER AGREE THAT THE DEPOSIT SHALL BE THE SOLE DAMAGES AND THE
SOLE AND EXCLUSIVE REMEDY OF SELLER, LEGAL, EQUITABLE OR OTHERWISE, IN THE EVENT
OF ANY DEFAULT OF PURCHASER. BY PLACING THEIR INITIALS BELOW, THE PARTIES
ACKNOWLEDGE THAT THE DEPOSIT HAS BEEN AGREED UPON AS THE PARTIES' REASONABLE
ESTIMATE OF SELLER'S DAMAGES AND AS SELLER'S EXCLUSIVE REMEDY AGAINST PURCHASER,
AT LAW OR IN EQUITY, IN THE EVENT OF A DEFAULT UNDER THIS AGREEMENT ON THE PART
OF PURCHASER. NOTWITHSTANDING THE FOREGOING, IN NO EVENT SHALL THE PROVISIONS OF
THIS SECTION 10.1 LIMIT ANY RIGHTS OR REMEDIES OF SELLER WHICH MAY ARISE BY
REASON OF A BREACH OF THE INDEMNITY OBLIGATIONS OF PURCHASER CONTAINED IN
SECTION 4.2 HEREOF, ALL OF WHICH ARE EXPRESSLY RESERVED.
INITIALS OF PURCHASER: INITIALS OF SELLER:
-------------- --------------
10.2. Default by Seller. If Seller (i) defaults in the obligations of
Seller to be performed at the Close of Escrow or (ii) otherwise materially
defaults hereunder and such material Default is not cured within ten (10) days
after notice thereof from Purchaser to Seller, then, and in either such event,
Purchaser may, as its sole remedy therefor, either (x) pursue an action for
specific performance of this Agreement by Seller hereunder, without abatement,
credit against or reduction of the Purchase Price or (y) terminate this
Agreement by written notice to Seller and Escrowee, whereupon the Escrow shall
be terminated and the Deposit shall be refunded to Purchaser; it being
understood and agreed that in no event shall Purchaser be entitled to money
damages. If Purchaser shall elect to so terminate this Agreement, then, upon
such election, neither party shall have any further rights or obligations
hereunder other than those which expressly survive the termination of this
Agreement. Except as expressly provided in this Section 10.2, Purchaser waives
any other right or remedy, at law or in equity, which Purchaser may have or be
entitled to as a result of any default by Seller.
10.3. Breach of Representation. If Purchaser proceeds to Closing with
knowledge of any inaccuracy in a representation of Seller, Purchaser shall be
deemed to have waived objection to such inaccuracy and shall have no right of
action or claim against Seller for damages or otherwise by reason thereof. If,
after the Closing, Purchaser shall first learn of an inaccuracy in any
representation of Seller (made as of the Closing Date), which representation
expressly survives Closing, then Purchaser shall have a claim for damages on
account thereof, provided that (i) any claim not brought within the applicable
survival period shall be deemed waived, (ii) Purchaser hereby waives the right
to collect or seek to collect consequential or punitive damages and (iii)
Purchaser reasonably can demonstrate that the damages sustained by Purchaser as
a result of such inaccuracy exceed $50,000.
ARTICLE 11. BROKER
------------------
11.1. Broker. Seller and Purchaser each represent and warrant to the other
that each has had no conversations or dealings with any broker or finder in
connection with the transactions contemplated hereby, other than Broker.
Purchaser and Seller (each, an "INDEMNIFYING PARTY") shall indemnify, defend and
hold the other harmless from and against any and all loss, cost or expense
(including, without limitation, reasonable attorneys' fees) arising by reason of
a claim for a commission or other compensation made by a broker or finder (other
than Broker) claiming to have dealt with the Indemnifying Party. The provisions
of this Article 11 shall survive Closing or any termination of this Agreement.
ARTICLE 12. ASSIGNMENT
----------------------
12.1. No Assignment by Purchaser. Neither this Agreement nor any of the
rights of Purchaser hereunder (nor the benefits of such rights) may be assigned,
transferred or encumbered without Seller's prior written consent (which consent
may be withheld in Seller's sole and absolute discretion) and any purported
assignment, transfer or encumbrance without Seller's prior written
consent shall be void. Purchaser expressly covenants and agrees that (a) if
Purchaser is a corporation, a sale or transfer of more than fifty (50%) percent
(at any one time or, in the aggregate from time to time) of the shares of any
class of the issued and outstanding stock of Purchaser, its successors or
assigns, or the issuance of additional shares of any class of its stock to the
extent of more than fifty (50%) percent (at any one time or, in the aggregate
from time to time) of the number of shares of said class of stock issued and
outstanding on the date hereof, (b) if Purchaser is a partnership, joint venture
or limited liability company, a sale or transfer of more than fifty (50%)
percent (at any one time or, in the aggregate from time to time) of the
partnership, joint venture, membership or other unincorporated association
interests of Purchaser, its successors or assigns, or the issuance of additional
partnership, joint venture or member interests of any class to the extent of
more than fifty (50%) percent (at any one time or, in the aggregate from time to
time) of the amount of partnership, joint venture or member interests issued on
the date hereof shall, in any such case, constitute an assignment of this
Agreement. Unless, in each instance, the prior written consent of Seller has
been obtained, any such assignment shall constitute a material default under
this Agreement and shall entitle Seller to exercise all rights and remedies
under this Agreement, at law or equity, in the case of such a Default.
12.2. Permitted Assignment to Affiliate. Notwithstanding the provisions of
Section 14.1 above to the contrary, the named Purchaser in this Agreement shall
have the one-time right to assign its rights and obligations under this
Agreement to an Affiliate of such named Purchaser effective on or prior to the
Closing, provided that on or prior to the effective date of such assignment,
Purchaser delivers to Seller evidence of the ownership of Purchaser and the
proposed assignee so as to permit Seller to verify that such proposed assignee
is an Affiliate of Purchaser and (c) on or prior to the effective date of such
assignment, the Purchaser shall deliver to Seller a written assumption, in form
reasonably satisfactory to Seller and duly executed and acknowledged by the
assignee, in which the assignee agrees to assume all of Purchaser's covenants,
agreements and obligations under this Agreement. As of the date of the
assignment of this Agreement to an Affiliate in accordance with the foregoing
provisions of this Section 12.2, the representations of Purchaser named herein
set forth in Section 7.1 hereof shall be remade as to the Affiliate, as
Purchaser, except that the representations and warranties set forth in Section
7.1(a) hereof shall be modified accordingly. Purchaser named herein shall remain
fully liable for all of Purchaser's covenants, agreements and obligations under
this Agreement notwithstanding any such permitted assignment pursuant to this
Section 12.2.
ARTICLE 13. COVENANTS
---------------------
13.1. Operation of Premises. Between the date hereof and the Closing Date,
Seller shall continue to maintain the Premises in the ordinary course and
substantially in accordance with the practices and procedures customarily
followed by Seller in the maintenance of the Premises prior to the date hereof;
provided, however, that Seller shall have no obligation to make any repairs or
expenditures that are capital in nature.
13.2. Insurance. Between the date hereof and the Closing Date, Seller shall
either (a) maintain in full force and effect the fire and other casualty
insurance coverages described in Exhibit Q annexed hereto or (b) replace such
insurance policies with other policies providing coverage equivalent thereto.
13.3. Modification of Leases. Between the date hereof and the Closing Date,
Seller shall not modify or amend any of the Existing Leases or any of the New
Leases without Purchaser's prior written consent in each instance, which consent
may be withheld in Purchaser's sole and absolute discretion; provided, however,
Seller shall have the right, without Purchaser's consent, to enter into any
modification or amendment of an Existing Lease or a New Lease if the same is
required pursuant to the terms of the Existing Lease or the New Lease, as the
case may be, or if the same is entered into to effectuate or memorialize the
exercise of any right or option contained in the Existing Lease or the New
Lease, as the case may be. If required, Purchaser's consent shall be deemed
granted if not denied by notice (stating the grounds for denial with reasonable
specificity) given to Seller within five (5) Business Days after request for
such consent by Seller.
13.4. Termination of Leases. Between the date hereof and the Closing Date,
Seller shall not cancel, accept the surrender of, or terminate any of the
Existing Leases or New Leases without Purchaser's prior written consent in each
instance, which consent may be withheld in Purchaser's sole and absolute
discretion; provided, however, Seller shall have the right, without Purchaser's
consent, to cancel, accept the surrender of, or terminate an Existing Lease or a
New Lease (i) if such cancellation, surrender or termination is predicated upon
a default of the tenant thereunder or (ii) if such cancellation, surrender or
termination is made by the tenant pursuant to the terms of the Existing Lease or
the New Lease, as the case may be. If required, Purchaser's consent shall be
deemed granted if not denied by notice (stating the grounds for denial with
reasonable specificity) given to Seller within five (5) Business Days after
request for such consent by Seller.
13.5. New Leases. Between the date hereof and the Closing Date, Seller
shall not enter into any New Leases without Purchaser's prior written consent in
each instance, which consent may be withheld in Purchaser's sole and absolute
discretion.
13.6. Leasing Costs. Purchaser shall pay and be solely responsible for the
payment of (or, to extent paid by Seller, shall reimburse Seller at the Closing
for), all or a portion of any Leasing Costs paid or payable by the landlord
under the Leases in connection with (i) any New Lease or any modification or
amendment of any New Lease to which Purchaser has consented or to which
Purchaser's consent is not required in accordance with the terms hereof and (ii)
any modification or amendment of an Existing Lease to which Purchaser has
consented or to which Purchaser's consent is not required in accordance with the
terms hereof, including Leasing Costs which arise after the date hereof by
reason of a Contingent Commission Event.
13.7. Service Contracts. Between the date hereof and the Closing Date,
Seller shall not enter into any New Service Contracts or modify, renew or extend
the term of any of the Existing Service Contracts or New Service Contracts
without Purchaser's prior written consent in each instance, which consent may be
withheld in Purchaser's sole and absolute discretion; provided, however, Seller
shall have the right, without Purchaser's consent, to enter into any New Service
Contracts and modify, renew or extend the term of any Existing Service Contracts
or New Service Contracts (i) if the same is cancelable upon no more than thirty
(30) days' notice without payment by Purchaser of a cancellation fee or (ii) if
the same is required pursuant to the terms of any of the Existing Service
Contracts or New Service Contracts or if the same is entered into to effectuate
or memorialize the exercise of any right or option on the part of the other
party (i.e., the contractor) contained in any of the Existing Service Contracts
or New Service Contracts. If required, Purchaser's consent shall be deemed
granted if not denied by notice (stating the grounds for denial
with reasonable specificity) given to Seller within two (2) Business Days after
request for such consent by Seller. Notwithstanding anything contained in this
Section 15.7 to the contrary, Seller shall have the right, without Purchaser's
consent, to terminate any one or more of the Existing Service Contracts and the
New Service Contracts at any time on or prior to the Closing Date.
13.8. Leasing and Management Agreements. Seller shall at Closing terminate
the Property Management Agreement (as defined in Exhibit D annexed hereto) and,
subject to the provisions of the Assignment of Service Contracts, Licenses and
Permits, the Leasing Agency Agreement (as defined in Exhibit D annexed hereto).
13.9. Unlawful Detainer Action. Notwithstanding any contrary provision
contained herein, Seller reserves the right to prosecute to completion that
certain unlawful detainer action commenced by Seller against the tenant under
the G. Ray Hawkins Lease (the "Action") or to settle or otherwise dispose of the
Action in the manner that Seller deems appropriate. Seller shall be entitled to
prosecute and collect any judgment obtained by Seller prior to the Close of
Escrow in the Action. If the Action is pending at the Close of Escrow, Seller
shall assign to Purchaser all of its right, title and interest in the Action. If
subsequent to the Close of Escrow Purchaser obtains a judgment in the Action and
ultimately collects upon the same, the amounts collected (net of reasonable
attorneys' fees incurred by Purchaser in prosecuting the Action) shall be pro
rated and applied in accordance with the provisions of Article 6 hereof.
ARTICLE 14. MISCELLANEOUS
-------------------------
14.1. Notices. (a) All notices, demands, requests and other communications
required hereunder shall be in writing and shall be deemed to have been given:
(i) upon delivery, if personally delivered; (ii) three (3) days after deposit in
the United States Mail when delivered, postage prepaid, by certified or
registered mail; (iii) one (1) Business Day after deposit with a nationally
recognized overnight delivery service marked for delivery on the next Business
Day; or (iv) upon receipt when transmitted by telecopy, provided that notice is
also sent by one of the foregoing three methods, in each case addressed to the
party for whom it is intended at its address hereinafter set forth:
If to Seller:
Wellsford Capital Properties, L.L.C.
c/o Wellsford Real Properties, Inc.
535 Madison Avenue
26th Floor
New York, New York 10022
Attention: William Darrow
Telecopy No: (212) 421-7244
with a copy to:
Robinson Silverman Pearce Aronsohn & Berman LLP
1290 Avenue of the Americas
New York, New York 10104
Attention: Dennis M. Sughrue, Esq.
Telecopy No. (212) 541-4630
If to Purchaser:
Dial Advisory Group, Inc.
11506 Nicholes Street, Suite 200
Omaha, Nebraska 68154
Attention: Starr Schulke
Telecopy: (402) 493-7495
If to Escrowee:
Commerce Escrow Company
1545 Wilshire Blvd.
Suite 600
Los Angeles, California 90012
Attention: Mark Minsky
Telecopy No. (213) 484-0417
(b) Any party may designate a change of address by written notice to
the others given in accordance with the provisions of this Section 14.1.
(c) The attorney for any party may send notices on that party's
behalf.
14.2. Transaction Costs. Seller, in addition to its responsibility for
escrow costs payable by Seller, shall also be responsible for the cost of its
legal counsel, advisors and the other professionals employed by it in connection
with the sale of the Property. Purchaser, in addition to its responsibility for
escrow costs payable by Purchaser, shall also be responsible for the cost of (i)
Purchaser's due diligence, (ii) Purchaser's legal counsel, advisors, engineers,
consultants and other professionals employed by it in connection with
Purchaser's due diligence and the purchase of the Property, and (iii) any
financing Purchaser may elect to obtain, including the incremental cost of any
lender's policy of title insurance.
14.3. Governing Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of California.
14.4. Successors. All of the provisions of this Agreement and of any of the
documents and instruments executed in connection herewith shall apply to and be
binding upon, and inure to the benefit of Seller and Purchaser, their successors
and their permitted assigns.
14.5. No Third Party Beneficiary. This Agreement and each of the provisions
hereof are solely for the benefit of Purchaser and Seller and their permitted
assigns. No provisions of this
Agreement or of any of the documents and instruments executed in connection
herewith shall be construed as creating in any person or entity other than
Purchaser and Seller and their permitted assigns any rights of any nature
whatsoever.
14.6. Entire Agreement. This Agreement, together with the documents and
instruments executed and delivered in connection herewith, set forth the entire
agreement between Purchaser and Seller relating to the transactions contemplated
hereby and all other prior or contemporaneous agreements, understandings,
representations or statements, oral or written, relating directly to the
Property are superseded hereby.
14.7. Severability. If any provision in this Agreement is found by a court
of competent jurisdiction to be in violation of any applicable law, and if such
court should declare such provision of this Agreement to be unlawful, void,
illegal or unenforceable in any respect, the remainder of this Agreement shall
be construed as if such unlawful, void, illegal or unenforceable provision were
not contained therein, and the rights, obligations and interests of the parties
hereto under the remainder of this Agreement shall continue in full force and
effect undisturbed and unmodified in any way.
14.8. Modification. This Agreement and the terms hereof may not be changed,
waived, modified, supplemented, canceled, discharged or terminated orally, but
only by an instrument or instruments in writing executed and delivered by Seller
and Purchaser.
14.9. Waiver of Trial by Jury. EACH PARTY HEREBY WAIVES, IRREVOCABLY AND
UNCONDITIONALLY, TRIAL BY JURY IN ANY ACTION BROUGHT ON, UNDER OR BY VIRTUE OF
OR RELATING IN ANY WAY TO THIS AGREEMENT OR ANY OF THE DOCUMENTS OR CERTIFICATES
EXECUTED IN CONNECTION HEREWITH, THE PROPERTY, OR ANY CLAIMS, DEFENSES, RIGHTS
OF SET-OFF OR OTHER ACTIONS PERTAINING HERETO OR TO ANY OF THE FOREGOING.
14.10. Venue. Purchaser and Seller each hereby irrevocably waives any
objection that it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of this Agreement or the transactions
contemplated hereby brought in any federal or state court sitting in the State
of California and hereby further irrevocably waives any claim that any such
suit, action or proceeding brought in any such court has been brought in an
inconvenient forum. Seller and Purchaser further hereby expressly submit to the
jurisdiction of all federal and state courts sitting in the State of California.
14.11. No Recording. Neither this Agreement nor any memorandum hereof shall
be recorded. Each party hereby agrees to indemnify and hold harmless the other
for all liabilities, losses, damages, liens, suits, claims, costs and expenses
(including reasonable attorneys' fees) incurred by the others by reason of a
breach of the foregoing covenant.
14.12. Captions. The captions and table of contents in this Agreement are
inserted for convenience of reference only and in no way define, describe or
limit the scope or intent of this Agreement or any of the provisions hereof.
14.13. Counterparts; Effectiveness of Agreement. This Agreement may be
executed in any number of counterparts, each of which shall constitute an
original but all of which together will
constitute one instrument. This Agreement shall not be effective unless and
until the same has been executed and delivered by all parties hereto whether in
one or more counterparts.
14.14. Merger. The delivery of the Deed to Purchaser and the closing of
title to the Property shall be deemed to constitute full performance and
discharge by Seller of every agreement and obligation on the part of Seller to
be performed hereunder, and no agreement, promise, representation or warranty,
express or implied, on the part of Seller shall survive Closing unless expressly
set forth to the contrary herein.
14.15. 1031 Exchange. Purchaser may desire to exchange the Property for
property of like-kind and qualifying use pursuant to Section 1031 of the
Internal Revenue Code, as amended. In connection therewith, Seller shall (i)
permit Purchaser to assign its interest (but not its obligations, to the extent
such obligations survive the Close of Escrow in accordance with the terms of
this Agreement) in this Agreement to a "Qualified Intermediary" as provided in
Treasury Regulations Section 1.1031(k)-1(g)(4) and (ii) accept payment of the
Closing Payment from such Qualified Intermediary. Seller shall cooperate with
Purchaser to the extent reasonably necessary to effectuate such exchange. In no
event, however, shall Seller be obligated to incur any expense, make any
representation or warranty or perform any covenant in favor of Purchaser or any
other party in connection with such exchange. Purchaser shall indemnify and hold
Seller harmless from and against any and all claims or costs incurred by Seller
in connection with such exchange.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
Seller:
------
WELLSFORD CAPITAL PROPERTIES, L.L.C.
By: Wellsford Capital, its sole member
By: /s/ William H. Darrow II
--------------------------------
Name: William H. Darrow II
Title: Vice President
Purchaser:
---------
DIAL ADVISORY GROUP, INC.
By: /s/ Philip J. Gibson
--------------------------------
Name: Philip J. Gibson
Title: President
Agreed as to Article 3 only:
COMMERCE ESCROW COMPANY:
By: /s/ Mark R. Minsky
--------------------------------
Name: Mark R. Minsky
Title: Vice President
Exhibit A
(the Ground Lease)
Joint Occupancy Lease (the "Ground Lease"), dated as of May 14, 1984, by and
between Santa Monica-Malibu Unified School District ("Lessor"), and City
Developers, Inc. ("CDI"), with respect to certain property located at 1651
Sixteenth Street and 900 Colorado Avenue both in Santa Monica, California, which
Lease was recorded as Instrument No. 85-994306 and amended by a Confirmatory
Memorandum of Joint Occupancy Lease, dated April 18, 1988, and recorded as
Instrument No. 88-557913.
The Ground Lease has been modified and assigned by the following addenda, letter
agreements and assignments.
1. First Addendum to Joint Occupancy Lease between Lessor and CDI dated
as of May 14, 1984 and executed on July 17, 1984;
2. Second Addendum to Joint Occupancy Lease between Lessor and CDI dated
as of May 14, 1984 and executed on July 17, 1984;
3. Assignment by CDI to Midis Properties, Ltd.("Midis") dated September
19, 1984 and recorded August 27, 1985 as Instrument No. 85-994307.
4. Third Addendum to Joint Occupancy Lease between Lessor and CDI
effective July 31, 1985;
5. Fourth Addendum to Joint Occupancy Lease between Lessor and CDI, dated
July 1986;
6. Fifth Addendum to Joint Occupancy Lease between Lessor and CDI, dated
July 1, 1986;
7. Letter agreement dated November 25, 1986 between Lessor and Midis;
8. Letter agreement dated October 21, 1987 between Lessor and Midis;
9. Sixth Addendum to Joint Occupancy Lease among Lessor, Midis and Santa
Monica HSR Limited Partnership ("HSR"), dated December 8, 1987;
10. Seventh Addendum to Joint Occupancy Lease among Lessor, Midis and HSR,
dated as of (undated) , 1993. ------------
11. Assignment by Midis to CAM Properties, Inc. et al, by assignment dated
December 12, 1994 and recorded June 30, 1995 as Instrument No.
95-1050542, and further assigned to Bay City Holdings, L.P. by
assignment dated December 12, 1994 and recorded June 30, 1995 as
Instrument No. 95-1050543.
12. Assignment of Joint Occupancy Lease, dated October 21, 1998 by and
between Bay City Holdings, L.P. and Wellsford Capital Properties,
L.L.C.
Exhibit B
(the Land)
PARCEL I:
- ---------
THE PARCEL OF LAND IN THE RANCHO SAN VICENTE Y SANTA MONICA, IN THE CITY OF
SANTA MONICA, SHOWN AS PARCEL 11, THREE AND TWO HUNDRED SIXTY-TWO THOUSANDTHS
(3.262) ACRES, AND MARKED APEDRO CARL CARRILLO@ ON THE MAP ATTACHED TO THE
CERTIFIED COPY OF THE FINAL DECREE OF PARTITION IN CASE NO. B-25296 OF THE
SUPERIOR COURT OF SAID COUNTY, RECORDED IN BOOK 6387, PAGE 1 OF DEEDS, RECORDS
OF LOS ANGELES COUNTY, STATE OF CALIFORNIA.
PARCEL II:
- ----------
LOTS 13 AND 14 OF THE STANDARD TRACT, IN THE CITY OF SANTA MONICA, AS PER MAP
FILED IN BOOK 5, PAGE 83 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF LOS
ANGELES SAID COUNTY, CALIFORNIA.
ALSO THAT PORTION OF LOT 15 OF SAID STANDARD TRACT AND, THAT PORTION OF THE
RANCHO SAN VICENTE Y SANTA MONICA, RECORDED IN BOOK 3, PAGE 30 OF PATENTS, IN
THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY, DESCRIBED AS A WHOLE AS
FOLLOWS:
BEGINNING AT THE MOST NORTHERLY CORNER OF LOT 14 OF THE STANDARD TRACT, AS PER
MAP FILED IN BOOK 5, PAGE 83 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF
LOS ANGELES COUNTY; THENCE SOUTH 44? 45' EAST ALONG THE NORTHEASTERLY LINE OF
SAID LOT 14 TO THE MOST EASTERLY CORNER OF SAID LOT 14; THENCE SOUTHWESTERLY
ALONG THE SOUTHEASTERLY LINE OF LOTS 13 AND 14 OF SAID STANDARD TRACT TO THE
MOST SOUTHERLY CORNER OF SAID LOT 13; THENCE SOUTH 44? 45' EAST ALONG THE
SOUTHEASTERLY PROLONGATION OF THE SOUTHWESTERLY LINE OF SAID LOT 13, 116.66
FEET, MORE OR LESS, TO A POINT IN A LINE DISTANT 30 FEET (MEASURED AT RIGHT
ANGLES) NORTHWESTERLY FROM AND PARALLEL TO THE SOUTHEASTERLY LINE OF SAID
STANDARD TRACT; THENCE NORTH 37? 26' EAST ALONG SAID PARALLEL LINE 50.44 FEET,
MORE OR LESS, TO ITS INTERSECTION WITH THE NORTHEASTERLY LINE OF SAID STANDARD
TRACT; THENCE SOUTH 44? 45' EAST ALONG SAID NORTHEASTERLY LINE 30.28 FEET, MORE
OR LESS, TO A POINT IN THE NORTHWESTERLY LINE 30.28 FEET MORE OR LESS, TO A
POINT IN THE NORTHWESTERLY RIGHT OF WAY LINE OF THE SOUTHERN PACIFIC COMPANY.
SAID POINT BEING ALSO THE MOST EASTERLY CORNER OF SAID STANDARD TRACT, THENCE
NORTH 37? 26' EAST 203.28 FEET, MORE OR LESS, ALONG SAID NORTHWESTERLY RIGHT OF
WAY LINE OF THE SOUTHERN PACIFIC COMPANY TO THE MOST SOUTHERLY CORNER OF THAT
CERTAIN 30 FOOT STRIP OF LAND CONVEYED TO LOS ANGELES PACIFIC RAILROAD COMPANY
BY E.P. CLARK IN BOOK
2805, PAGE 199 OF DEEDS; THENCE NORTH 44? 45' WEST 30 FEET TO THE MOST WESTERLY
CORNER OF SAID 30 FOOT STRIP OF LAND; THENCE NORTHEASTERLY 235.90 FEET, MORE OR
LESS, ALONG THE NORTHWESTERLY LINE OF SAID 30 FOOT STRIP OF LAND TO A POINT IN
THE SOUTHEASTERLY PROLONGATION OF THE NORTHEASTERLY LINE OF TENTH STREET , 80
FEET WIDE; THENCE NORTHWESTERLY ALONG SAID PROLONGED LINE OF 140.4 FEET, MORE OR
LESS, TO A POINT IN THE SOUTHEASTERLY LINE OF COLORADO AVENUE (FORMERLY RAILROAD
AVENUE) 80 FEET WIDE; THENCE SOUTHWESTERLY ALONG THE SOUTHEASTERLY LINE OF SAID
COLORADO AVENUE 435.10 FEET, MORE OR LESS, TO THE POINT OF BEGINNING.
Exhibit C
(Existing Leases)
1. Standard Industrial/Commercial Multi-Tenant Lease-Modified Net, dated as of
February 7, 1997, by and between Bay City Holdings, LP, as Lessor, and
Direct Partners, L.L.C., as Lessee, which Lease was amended pursuant to
that First Amendment to Lease, dated as of August 15, 1997, by and between
Lessor and Lessee, which Lease was assigned, pursuant to that certain
Assignment and Assumption of Standard Industrial/Commercial Multi-Tenant
Lease, dated as of April 30, 1999, by and between Direct Partners L.L.C.,
as assignor, and DP Acquisition Inc., as assignee. (Agreement of Sublease
dated as of May 11, 2000, by and between Direct Partners Inc., as
Sublessor, and Groundswell Inc., as Sublessee).
2. Standard Industrial Lease - Multi-Tenant, dated as of July 1, 1993, by and
between Midas Properties Ltd., as Lessor, and G. Ray Hawkins, as Tenant.
3. Standard Industrial Lease - Multi-Tenant, dated as of April 20, 1995, by
and between Bay City Holdings L.P., as Lessor, and Direct Partners, as
Lessee, which Lease was amended pursuant to that First Amendment To Lease,
dated August 15, 1997, by and between Lessor and Direct Partners LLC,
successor in interest to Direct Partners, as Lessee. (the "Direct Partners
Lease").
4. Standard Industrial Lease - Net, dated as of October 15, 1992, by and
between Midas Properties, Ltd., as Lessor and Dalkey Post, Inc., as Lessee,
which Lease was amended pursuant to that Amendment Number One To Lease
Agreement, dated July 9, 1997, by and between Lessor and Lessee.
5. Lease Agreement, dated as of August 30, 2000, by and between Wellsford
Capital Properties LLC, as Landlord and The Accelerator Group LLC, as
Tenant.
6. Standard Industrial Lease - Net, dated as of October 1, 1992, by and
between Midas Properties, Ltd., as Lessor, and Christopher Grimes, as
Lessee, which Lease was amended pursuant to that Amendment Number One To
Lease Agreement, dated as of March 7, 1997, by and between Bay City Holding
LP, successor in interest to Midas Properties Ltd., as Lessor and Lessee.
7. Standard Industrial/Commercial Multi-Tenant Lease - Modified Net, dated as
of May 31, 1996, by and between Bay City Holdings LP, as Lessor and Darling
Construction & Realty Corporation, as Lessee. (Sublease, dated as of
January 17, 1997, by and between Darling Contruction, as Sublessor and
Crazy Horse Editorial, as Sublessee, Further Sublease, dated as of October
1, 1997, by and between Crazy Horse Editorial, as Sublessor and Conning,
Hammers, Klok & Wagner, as Sublessee, Further Sublease, dated as of
September 14, 1999, by and between Conning, Hammers, Klok & Wagner, as
Sublessor and Base 2, as Sublessee).
8. Lease Agreement, dated as of November 22, 1999, by and between Wellsford
Capital Properties LLC, as Landlord, and AFT Corporation, as Tenant.
9. Lease Agreement, dated as of March 9, 1999, by and between Wellsford
Capital Properties L.L.C., as Landlord, and Mary Martinuzzi dba Mary M.
Photography, as Tenant.
10. Standard Industrial Lease - Multi-Tenant, dated as of April 1, 1995, by and
between Bay City Holdings LP, as Lessor and Graying & Balding, Inc., as
Lessee, which Lease was amended pursuant to that First Amendment To Lease,
dated as of May 12, 1995, by and between Lessor and Lessee. (Standard
Sublease, dated as of May 19, 1999, by and between Graying & Balding, Inc.,
as Sublessor and Intervisual Communication, Inc., as Sublessee).
11. Lease Agreement, dated as of October 25, 1999, by and between Wellsford
Capital Properties LLC, as Landlord and GMP Architects, Inc., as Tenant.
12. Lease Agreement, dated as of August 29, 2000, by and between Wellsford
Capital Properties LLC, as Landlord and Interior Spaces, Inc., as Tenant.
13. Lease Agreement, dated as of May 19, 2000, by and between Wellsford Capital
Properties LLC, as Landlord and The Pet Allergy Center, Inc., as Tenant.
14. Lease Agreement, dated as of May 22, 2000, by and between Wellsford Capital
Properties LLC, as Landlord and Gabrielle Raumberger dba Gabrielle
Raumberger Design, as Tenant.
15. Lease Agreement, dated as of February 5, 1999, by and between Wellsford
Capital Properties LLC, as Landlord and Shigura, Ltd., as Tenant.
16. Lease Agreement, dated as of February 1, 1999, by and between Wellsford
Capital Properties LLC, as Landlord and Gary E. Carr and Sandra B. Carr, as
Tenant.
17. Standard Industrial/Commercial Multi-Tenant Lease - Modified Net, dated as
of December 17, 1996, by and between Bay City Holdings LP, as Lessor and
Anti Gravity Products aka Daniel Lutz, as Lessee.
18. Joint Occupancy Lease, dated as of May 14, 1984, by and between Santa
Monica-Malibu Unified School District, as Lessor and City Developers, Inc.,
as Lessee, which Lease is modified pursuant to First Addendum To Joint
Occupancy Lease, dated as of May 14, 1984, by and between Lessor and
Lessee, which Lease is modified pursuant to Second Addendum To Joint
Occupancy Lease, dated as of May 14, 1984, by and between Lessor and
Lessee, which Lease is modified pursuant to Third Addendum to Joint
Occupancy Lease, dated as of July 31, 1985, by and between Lessor and
Lessee, which Lease is modified pursuant to Fourth Addendum to Joint
Occupancy Lease, dated as of July 1986, by and between Lessor and Lessee,
which Lease is modified pursuant to Fifth Addendum to Joint Occupancy
Lease, dated as of July 1, 1986, by and between Lessor and Lessee, which
Lease is modified pursuant to Letter Agreement. Dated as of July 1, 1986,
by and between Lessor and Lessee, which Lease is modified pursuant to
Letter Agreement, dated as of November 25, 1986, by and between Lessor and
Lessee, which Lease is modified pursuant to Letter Agreement, dated as of
October 21, 1987, by and between Lessor and Lessee, which Lease is modified
pursuant to Sixth Addendum to Joint Occupancy Lease, dated as of December
8, 1987, by and between Lessor and Midas Properties Ltd., successor in
interest to City Developers, Inc.
and Santa Monica HSR Limited Partnership ("HSR"), as Lessee, which Lease is
modified pursuant to Seventh Addendum to Joint Occupancy Lease, which is
undated, by and among Lessor, Midas and HSR, which canceled the First
through Fifth Addendums and two Letter Agreements with respect to the
Sixteenth Street and Colorado Avenue properties, which Lease was assigned
pursuant to Absolute Assignment of Leasehold Estate and Consent, dated as
of December 12, 1994 by and between Lessor and Lessee, recorded June 30,
1995 as Document No. 95-1050543.
19. Lease Agreement, dated as of February 28, 2000, by and between Wellsford
Capital Properties LLC, as Landlord and Interpacket Networks, Inc., as
Tenant.
20. Standard Industrial Multi-Tenant Lease - Modified Net, dated as of December
4, 1996, by and between Bay City Holdings LP, as Lessor and Dot Imaging &
Printing, Inc., as Lessee.
21. Standard Industrial/Commercial Multi-Tenant Lease - Modified Net, dated as
of June 19, 1997, by and between Bay City Properties LP, as Lessor and
Santa Monica Malibu Unified School District, as Lessee (the "Santa Monica -
Malibu School District Lease").
22. Standard Industrial/Commercial Multi-Tenant Lease - Modified Net, dated as
of April 6, 1998, by and between Bay City Properties LP, as Lessor and
Laurant Beverly Hills, Inc., as Lessee. (Sublease, dated as of (undated),
by and between Laurant Beverly Hills, Inc., as Sublessor and KAOS
Entertainment, Inc., as Sublessee).
23. Standard Industrial/Commercial Multi-Tenant Lease - Modified Net, dated as
of January 14, 1998, by and between Bay City Properties LP, as Lessor and
American Medical Response of Southern California, as Lessee.
24. Lease Agreement, dated as of November 16, 2000, by and between Wellsford
Capital Properties LLC, as Landlord and Beyond Imagination Graphics, as
Tenant.
25. Standard Industrial/Commercial Multi-Tenant Lease - Modified Net, dated as
of April 15, 1997, by and between Bay City Holdings LP, Lessor and
Commercial Graphics Corporation, as Lessee, which Lease was transferred
pursuant to Consent To Transfer, which is undated, by and between
Commercial Graphics Corporation, as Tenant and ARC Acquisition Corporation,
as Transferee.
Exhibit D
(Service Contracts and Brokerage Agreements)
1. Property Management Agreement, dated as of April 1, 2000, by and between
Wellsford Capital Properties, LLC and Charles Dunn Real Estate Services,
Inc. (the "Property Management Agreement").
2. Leasing Agreement dated May 1, 2000 for Bay City Holdings between Wellsford
Real Properties, LLC and Westmac Commercial Brokerage Company (the "Leasing
Agency Agreement").
3. Service Contract, dated as of September 10, 1998, by and between Bay City
Holdings, LP and Coverall of the San Fernando Valley, Inc.
4 Service Agreement, dated as of January 1, 2000, by and between Bay City
Holding Inc. and Consolidated Services Inc. (900 Colorado Avenue)
5. Service Agreement, dated as of January 1, 2000, by and between Bay City
Holding Inc. and Consolidated Services Inc. (1630 17th Street)
6. Service Agreement, dated as of January 1, 2000, by and between Bay City
Holding Inc. and Consolidated Services Inc. (1651 16th Street)
7. Agreement, dated as of July 17, 2000, by and between Wellsford Capital
Properties LLC and Vivitar Security Systems, Inc. (900 Colorado Avenue)
8. System Purchase Agreement. Dated as of February 22, 1996, by and between
Bay City Holdings and API Security Inc. (1651 16th Street)
9. Service Contract, dated as of November 25, 1997, by and between Wellsford
Capital Properties LLC and Live Art Plantscapes.
10. Service Contract, dated as of June 30, 1998, by and between Bay City
Holdings LC and Klean Sweep. Inc.
Exhibit E
(Form of Assignment of Ground Lease)
ASSIGNMENT OF GROUND LEASE
--------------------------
THIS ASSIGNMENT OF GROUND LEASE (this "ASSIGNMENT"), is made as of the ___
day of January, 2001, by and between WELLSFORD CAPITAL PROPERTIES, L.L.C., a
Delaware limited liability company having an address c/o Wellsford Real
Properties, Inc., 535 Madison Avenue, 26th Floor, New York, New York 10022
("ASSIGNOR"), and DIAL ADVISORY GROUP, INC., a Nebraska corporation having an
office at 11506 Nicholes Street, Suite 200, Omaha, Nebraska 68154 ("ASSIGNEE").
R E C I T A L S
---------------
Pursuant to that certain Purchase and Sale Agreement dated as of December
___, 2000 between Assignor, as seller, and Assignee, as purchaser (the "PURCHASE
AGREEMENT"), Assignor is selling to Assignee its interest as lessee under that
certain ground lease described in Schedule A annexed hereto (the "GROUND
LEASE"), which Ground Lease demises premises located at 1651 Sixteenth Street
and 900 Colorado Boulevard, Santa Monica, California, which premises are more
particularly described on Schedule B annexed hereto.
NOW, THEREFORE, in consideration of the foregoing promises, covenants and
undertakings contained in this Assignment, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties agree as follows:
ASSIGNMENT AND ASSUMPTION
-------------------------
Assignor hereby assigns, transfers, sets-over, delivers and conveys unto
Assignee all of the rights, benefits and privileges of Assignor, as lessee under
the Ground Lease, TO HAVE AND TO HOLD unto Assignee.
Assignee assumes and agrees to discharge and perform all duties,
obligations and liabilities of the lessee under the Ground Lease first arising
or accruing from and after the date hereof.
This Assignment is made by Assignor without recourse, representation or
warranty of any kind, except as may be expressly set forth in the Purchase
Agreement and subject to the limitations on survival of representations and
warranties set forth therein.
This Assignment shall be binding upon, enforceable by and shall inure to
the benefit of the successors and assigns of the parties.
This Assignment may be signed in multiple counterparts which, when taken
together and signed by all parties and delivered to any other party hereto,
shall constitute a binding Assignment between the parties.
This Assignment shall be governed by and construed in accordance with the
laws of the State of California.
IN WITNESS WHEREOF, Assignor and Assignee have duly executed this
Assignment as of the date first set forth above.
ASSIGNOR:
WELLSFORD CAPITAL PROPERTIES, L.L.C.
By: Wellsford Capital, a Maryland real estate investment trust
By:
--------------------------------
Name:
Title:
ASSIGNEE:
DIAL ADVISORY GROUP, INC.
By:
--------------------------------
Name:
Title:
Schedule A to Exhibit E
-----------------------
Joint Occupancy Lease (the "Ground Lease"), dated as of May 14, 1984, by and
between Santa Monica-Malibu Unified School District ("Lessor"), and City
Developers, Inc. ("CDI"), with respect to certain property located at 1651
Sixteenth Street, 900 Colorado Avenue in Santa Monica, California, which Lease
was recorded as Instrument No. 85-994306 and amended by a Confirmatory
Memorandum of Joint Occupancy Lease, dated April 18, 1988, and recorded as
Instrument No. 88-557913.
The Ground Lease has been modified and assigned by the following addenda, letter
agreements and assignments.
1. First Addendum to Joint Occupancy Lease between Lessor and CDI dated as of
May 14, 1984 and executed on July 17, 1984;
2. Second Addendum to Joint Occupancy Lease between Lessor and CDI dated as of
May 14, 1984 and executed on July 17, 1984;
3. Assignment by CDI to Midis Properties, Ltd.("Midis") dated September 19,
1984 and recorded August 27, 1985 as Instrument No. 85-994307.
4. Third Addendum to Joint Occupancy Lease between Lessor and CDI effective
July 31, 1985;
5. Fourth Addendum to Joint Occupancy Lease between Lessor and CDI, dated July
1986;
6. Fifth Addendum to Joint Occupancy Lease between Lessor and CDI, dated July
1, 1986;
7. Letter agreement dated November 25, 1986 between Lessor and Midis;
8. Letter agreement dated October 21, 1987 between Lessor and Midis;
9. Sixth Addendum to Joint Occupancy Lease among Lessor, Midis and Santa
Monica HSR Limited Partnership ("HSR"), dated December 8, 1987; ---
10. Seventh Addendum to Joint Occupancy Lease among Lessor, Midis and HSR,
dated as of (undated), 1993.
11. Assignment by Midis to CAM Properties, Inc. et al, by assignment dated
December 12, 1994 and recorded June 30, 1995 as Instrument No. 95-1050542,
and further assigned to Bay City Holdings, L.P. by assignment dated
December 12, 1994 and recorded June 30, 1995 as Instrument No. 95-1050543.
12. Assignment of Joint Occupancy Lease, dated October 21, 1998 by and between
Bay City Holdings, L.P. and Wellsford Capital Properties, L.L.C.
Schedule B to Exhibit E
-----------------------
PARCEL I:
- ---------
THE PARCEL OF LAND IN THE RANCHO SAN VICENTE Y SANTA MONICA, IN THE CITY OF
SANTA MONICA, SHOWN AS PARCEL 11, THREE AND TWO HUNDRED SIXTY-TWO THOUSANDTHS
(3.262) ACRES, AND MARKED APEDRO CARL CARRILLO@ ON THE MAP ATTACHED TO THE
CERTIFIED COPY OF THE FINAL DECREE OF PARTITION IN CASE NO. B-25296 OF THE
SUPERIOR COURT OF SAID COUNTY, RECORDED IN BOOK 6387, PAGE 1 OF DEEDS, RECORDS
OF LOS ANGELES COUNTY, STATE OF CALIFORNIA.
PARCEL II:
- ----------
LOTS 13 AND 14 OF THE STANDARD TRACT, IN THE CITY OF SANTA MONICA, AS PER MAP
FILED IN BOOK 5, PAGE 83 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF LOS
ANGELES SAID COUNTY, CALIFORNIA.
ALSO THAT PORTION OF LOT 15 OF SAID STANDARD TRACT AND, THAT PORTION OF THE
RANCHO SAN VICENTE Y SANTA MONICA, RECORDED IN BOOK 3, PAGE 30 OF PATENTS, IN
THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY, DESCRIBED AS A WHOLE AS
FOLLOWS:
BEGINNING AT THE MOST NORTHERLY CORNER OF LOT 14 OF THE STANDARD TRACT, AS PER
MAP FILED IN BOOK 5, PAGE 83 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF
LOS ANGELES COUNTY; THENCE SOUTH 44? 45' EAST ALONG THE NORTHEASTERLY LINE OF
SAID LOT 14 TO THE MOST EASTERLY CORNER OF SAID LOT 14; THENCE SOUTHWESTERLY
ALONG THE SOUTHEASTERLY LINE OF LOTS 13 AND 14 OF SAID STANDARD TRACT TO THE
MOST SOUTHERLY CORNER OF SAID LOT 13; THENCE SOUTH 44? 45' EAST ALONG THE
SOUTHEASTERLY PROLONGATION OF THE SOUTHWESTERLY LINE OF SAID LOT 13, 116.66
FEET, MORE OR LESS, TO A POINT IN A LINE DISTANT 30 FEET (MEASURED AT RIGHT
ANGLES) NORTHWESTERLY FROM AND PARALLEL TO THE SOUTHEASTERLY LINE OF SAID
STANDARD TRACT; THENCE NORTH 37? 26' EAST ALONG SAID PARALLEL LINE 50.44 FEET,
MORE OR LESS, TO ITS INTERSECTION WITH THE NORTHEASTERLY LINE OF SAID STANDARD
TRACT; THENCE SOUTH 44? 45' EAST ALONG SAID NORTHEASTERLY LINE 30.28 FEET, MORE
OR LESS, TO A POINT IN THE NORTHWESTERLY LINE 30.28 FEET MORE OR LESS, TO A
POINT IN THE NORTHWESTERLY RIGHT OF WAY LINE OF THE SOUTHERN PACIFIC COMPANY.
SAID POINT BEING ALSO THE MOST EASTERLY CORNER OF SAID STANDARD TRACT, THENCE
NORTH 37? 26' EAST 203.28 FEET, MORE OR LESS, ALONG SAID NORTHWESTERLY RIGHT OF
WAY LINE OF THE SOUTHERN PACIFIC COMPANY TO THE MOST SOUTHERLY CORNER OF THAT
CERTAIN 30 FOOT STRIP OF LAND CONVEYED TO LOS ANGELES PACIFIC RAILROAD COMPANY
BY E.P. CLARK IN BOOK 2805, PAGE 199 OF DEEDS; THENCE NORTH 44? 45' WEST 30 FEET
TO THE MOST WESTERLY CORNER OF SAID 30 FOOT STRIP OF LAND; THENCE NORTHEASTERLY
235.90 FEET, MORE OR LESS, ALONG THE NORTHWESTERLY LINE OF SAID 30 FOOT
STRIP OF LAND TO A POINT IN THE SOUTHEASTERLY PROLONGATION OF THE NORTHEASTERLY
LINE OF TENTH STREET , 80 FEET WIDE; THENCE NORTHWESTERLY ALONG SAID PROLONGED
LINE OF 140.4 FEET, MORE OR LESS, TO A POINT IN THE SOUTHEASTERLY LINE OF
COLORADO AVENUE (FORMERLY RAILROAD AVENUE) 80 FEET WIDE; THENCE SOUTHWESTERLY
ALONG THE SOUTHEASTERLY LINE OF SAID COLORADO AVENUE 435.10 FEET, MORE OR LESS,
TO THE POINT OF BEGINNING.
Exhibit F
[INTENTIONALLY OMITTED]
Exhibit G
(Form of Bill of Sale)
BILL OF SALE
------------
WELLSFORD CAPITAL PROPERTIES, L.L.C., a Delaware limited liability company
having an address c/o Wellsford Real Properties, Inc., 535 Madison Avenue, 26th
Floor, New York, New York 10022 ("SELLER"), for and in consideration of the sum
of Ten Dollars ($10.00), lawful money of the United States, to it in hand paid,
at or before delivery of these presents by DIAL ADVISORY GROUP, INC., a Nebraska
corporation having an office at 11506 Nicholes Street, Suite 200, Omaha,
Nebraska 68154 ("PURCHASER"), the receipt of which is hereby acknowledged, has
bargained and sold, and by these presents does grant and convey unto Purchaser,
its successors and assigns forever all right, title and interest of Seller in
and to all of the equipment, furniture, fittings, fixtures and articles of
personal property owned by Seller and affixed or attached to, installed or
placed in or upon and used for or useable in any present or future enjoyment,
occupancy or operation of the real property described in Schedule A annexed
hereto, including, without limitation, those items set forth on Schedule B
annexed hereto.
This Bill of Sale is made without recourse, representation or warranty of
any kind.
TO HAVE AND TO HOLD the same unto Purchaser its successors and assigns
forever.
This Bill of Sale shall be governed by and construed in accordance with the
laws of the State of California.
IN WITNESS WHEREOF, Seller has caused this instrument to be duly executed
as of this day of , 2000.
WELLSFORD CAPITAL PROPERTIES, L.L.C.
By: Wellsford Capital, a Maryland real estate investment trust
By:
--------------------------------
Name:
Title:
Exhibit H
(Form of Assignment of Leases)
ASSIGNMENT AND ASSUMPTION OF LEASES
-----------------------------------
THIS ASSIGNMENT AND ASSUMPTION OF LEASES (this "ASSIGNMENT"), is made as of
the ___ day of January, 2001, by and between WELLSFORD CAPITAL PROPERTIES,
L.L.C., a Delaware limited liability company having an address c/o Wellsford
Real Properties, Inc., 535 Madison Avenue, 26th Floor, New York, New York 10022
("ASSIGNOR"), and DIAL ADVISORY GROUP, INC., a Nebraska corporation having an
office at 11506 Nicholes Street, Suite 200, Omaha, Nebraska 68154 ("ASSIGNEE").
R E C I T A L S
---------------
Pursuant to that certain Sale and Purchase Agreement dated as of the date
hereof between Assignor, as seller, and Assignee, as purchaser (the
"AGREEMENT"), Assignor is selling the Property (as that term is defined in the
Agreement) to Assignee.
NOW, THEREFORE, in consideration of the foregoing promises, covenants and
undertakings contained in this Assignment, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties agree as follows:
ASSIGNMENT AND ASSUMPTION
-------------------------
Assignor hereby assigns, transfers, sets-over, delivers and conveys unto
Assignee all of the rights, benefits and privileges of Assignor, as landlord,
under the leases (the "LEASES") described in Schedule A annexed hereto and
incorporated herein by this reference, including without limitation, all rents,
issues and profits arising therefrom (subject to adjustment as set forth in the
Agreement), TO HAVE AND TO HOLD all and singular subject as aforesaid, unto
Assignee.
Assignee assumes and agrees to discharge and perform all duties,
obligations and liabilities of the landlord under the Leases first arising or
accruing from and after the date hereof.
This Assignment is made by Assignor without recourse, representation or
warranty of any kind, except as may be expressly set forth in the Agreement, and
subject to the limitations on survival of representations and warranties set
forth therein.
This Assignment shall be binding upon, enforceable by and shall inure to
the benefit of the successors and assigns of the parties.
This Assignment may be signed in multiple counterparts which, when taken
together and signed by all parties and delivered to any other party hereto,
shall constitute a binding Assignment between the parties.
This Assignment shall be governed by and construed in accordance with the
laws of the State of California.
IN WITNESS WHEREOF, Assignor and Assignee have duly executed this
Assignment as of the date first set forth above.
ASSIGNOR:
WELLSFORD CAPITAL PROPERTIES, L.L.C.
By: Wellsford Capital, a Maryland real estate investment trust
By:
--------------------------------
Name:
Title:
ASSIGNEE:
DIAL ADVISORY GROUP, INC.
By:
--------------------------------
Name:
Title:
Schedule A to Exhibit H
*[To follow]*
Exhibit I
(Form of Assignment of Service Contracts, Licenses and Permits)
ASSIGNMENT AND ASSUMPTION
-------------------------
OF SERVICE CONTRACTS, LICENSES AND PERMITS
------------------------------------------
THIS ASSIGNMENT AND ASSUMPTION OF CONTRACTS, PERMITS, AND WARRANTIES (this
"ASSIGNMENT") is made as of the ___ day of January, 2001, by and between
WELLSFORD CAPITAL PROPERTIES, L.L.C., a Delaware limited liability company
having an address c/o Wellsford Real Properties, Inc., 535 Madison Avenue, 26th
Floor, New York, New York 10022 ("ASSIGNOR"), and DIAL ADVISORY GROUP, INC., a
Nebraska corporation having an office at 11506 Nicholes Street, Suite 200,
Omaha, Nebraska 68154 ("ASSIGNEE").
R E C I T A L S
---------------
Pursuant to that certain Purchase and Sale Agreement dated as of December
___, 2000 between Assignor, as seller, and Assignee, as purchaser (the
"AGREEMENT"), Assignor is selling the Property to Assignee. All capitalized
terms not defined herein shall have the respective meanings ascribed thereto in
the Agreement.
NOW THEREFORE, in consideration of the foregoing promises, covenants and
undertakings contained in this Assignment, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties agree as follows:
A G R E E M E N T
-----------------
1. The term "PROPERTY INTERESTS", as used herein, shall mean, collectively,
all of Assignor's right, title and interest in and to the Service Contracts,
Licenses and Permits affecting the real property described on Schedule A annexed
hereto.
2. (a) Assignor hereby assigns, transfers, sets-over, delivers and conveys
to Assignee all of Assignor's right, title and interest in and to the Property
Interests.
(b) Assignee hereby accepts the foregoing assignment and agrees to
assume, keep, perform and fulfill all of the terms, conditions and
obligations which are required to be kept, performed and fulfilled by
Assignor in connection with or arising out of the Property Interests, first
arising or accruing from and after the date hereof.
(c) Assignee further hereby assumes the obligations of Assignor with
respect to post-termination leasing commissions payable in accordance with
Exhibit B, Section 9 of the Leasing Agency Agreement.
3. This Assignment is made by Assignor without recourse,
representation or warranty or any kind, except as may be expressly set
forth in the Agreement, and subject to the limitations on the survival of
representations and warranties set forth therein.
4. This Assignment shall be binding upon, enforceable by and shall
inure to the benefit of the successors and assigns of the parties.
5. This Assignment may be signed in multiple counterparts which, when
taken together and signed by all parties and delivered to any other party
hereto, shall constitute a binding Assignment between the parties.
6. This Assignment shall be governed by and construed in accordance
with the laws of the State of California.
IN WITNESS WHEREOF, Assignor and Assignee have duly executed this
instrument as of the date first set forth above.
ASSIGNOR:
WELLSFORD CAPITAL PROPERTIES, L.L.C.
By: Wellsford Capital, a Maryland real estate investment trust
By:
--------------------------------
Name:
Title:
ASSIGNEE:
DIAL ADVISORY GROUP, INC.
By:
--------------------------------
Name:
Title:
Schedule A to Exhibit I
PARCEL I:
- ---------
THE PARCEL OF LAND IN THE RANCHO SAN VICENTE Y SANTA MONICA, IN THE CITY OF
SANTA MONICA, SHOWN AS PARCEL 11, THREE AND TWO HUNDRED SIXTY-TWO THOUSANDTHS
(3.262) ACRES, AND MARKED APEDRO CARL CARRILLO@ ON THE MAP ATTACHED TO THE
CERTIFIED COPY OF THE FINAL DECREE OF PARTITION IN CASE NO. B-25296 OF THE
SUPERIOR COURT OF SAID COUNTY, RECORDED IN BOOK 6387, PAGE 1 OF DEEDS, RECORDS
OF LOS ANGELES COUNTY, STATE OF CALIFORNIA.
PARCEL II:
- ----------
LOTS 13 AND 14 OF THE STANDARD TRACT, IN THE CITY OF SANTA MONICA, AS PER MAP
FILED IN BOOK 5, PAGE 83 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF LOS
ANGELES SAID COUNTY, CALIFORNIA.
ALSO THAT PORTION OF LOT 15 OF SAID STANDARD TRACT AND, THAT PORTION OF THE
RANCHO SAN VICENTE Y SANTA MONICA, RECORDED IN BOOK 3, PAGE 30 OF PATENTS, IN
THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY, DESCRIBED AS A WHOLE AS
FOLLOWS:
BEGINNING AT THE MOST NORTHERLY CORNER OF LOT 14 OF THE STANDARD TRACT, AS PER
MAP FILED IN BOOK 5, PAGE 83 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF
LOS ANGELES COUNTY; THENCE SOUTH 44? 45' EAST ALONG THE NORTHEASTERLY LINE OF
SAID LOT 14 TO THE MOST EASTERLY CORNER OF SAID LOT 14; THENCE SOUTHWESTERLY
ALONG THE SOUTHEASTERLY LINE OF LOTS 13 AND 14 OF SAID STANDARD TRACT TO THE
MOST SOUTHERLY CORNER OF SAID LOT 13; THENCE SOUTH 44? 45' EAST ALONG THE
SOUTHEASTERLY PROLONGATION OF THE SOUTHWESTERLY LINE OF SAID LOT 13, 116.66
FEET, MORE OR LESS, TO A POINT IN A LINE DISTANT 30 FEET (MEASURED AT RIGHT
ANGLES) NORTHWESTERLY FROM AND PARALLEL TO THE SOUTHEASTERLY LINE OF SAID
STANDARD TRACT; THENCE NORTH 37? 26' EAST ALONG SAID PARALLEL LINE 50.44 FEET,
MORE OR LESS, TO ITS INTERSECTION WITH THE NORTHEASTERLY LINE OF SAID STANDARD
TRACT; THENCE SOUTH 44? 45' EAST ALONG SAID NORTHEASTERLY LINE 30.28 FEET, MORE
OR LESS, TO A POINT IN THE NORTHWESTERLY LINE 30.28 FEET MORE OR LESS, TO A
POINT IN THE NORTHWESTERLY RIGHT OF WAY LINE OF THE SOUTHERN PACIFIC COMPANY.
SAID POINT BEING ALSO THE MOST EASTERLY CORNER OF SAID STANDARD TRACT, THENCE
NORTH 37? 26' EAST 203.28 FEET, MORE OR LESS, ALONG SAID NORTHWESTERLY RIGHT OF
WAY LINE OF THE SOUTHERN PACIFIC COMPANY TO THE MOST SOUTHERLY CORNER OF THAT
CERTAIN 30 FOOT STRIP OF LAND CONVEYED TO LOS ANGELES PACIFIC RAILROAD COMPANY
BY E.P. CLARK IN BOOK 2805, PAGE 199 OF DEEDS; THENCE NORTH 44? 45' WEST 30 FEET
TO THE MOST WESTERLY CORNER OF SAID 30 FOOT STRIP OF LAND; THENCE NORTHEASTERLY
235.90 FEET, MORE OR LESS, ALONG THE NORTHWESTERLY LINE OF SAID 30 FOOT
STRIP OF LAND TO A POINT IN THE SOUTHEASTERLY PROLONGATION OF THE NORTHEASTERLY
LINE OF TENTH STREET , 80 FEET WIDE; THENCE NORTHWESTERLY ALONG SAID PROLONGED
LINE OF 140.4 FEET, MORE OR LESS, TO A POINT IN THE SOUTHEASTERLY LINE OF
COLORADO AVENUE (FORMERLY RAILROAD AVENUE) 80 FEET WIDE; THENCE SOUTHWESTERLY
ALONG THE SOUTHEASTERLY LINE OF SAID COLORADO AVENUE 435.10 FEET, MORE OR LESS,
TO THE POINT OF BEGINNING.
Exhibit J
[INTENTIONALLY OMITTED]
Exhibit K
[INTENTIONALLY OMITTED]
Exhibit L
[INTENTIONALLY OMITTED]
Exhibit M
(Form of Ground Lease Estoppel Certificate)
GROUND LEASE ESTOPPEL CERTIFICATE
Reference is hereby made to that certain Joint Occupancy Lease (the "Ground
Lease") as more particularly described on Exhibit A, which is attached hereto.
Santa Monica-Malibu Unified School District (the "Ground Lessor")
understands that Dial Advisory Group, Inc., a Nebraska corporation having an
office at 11506 Nicholes Street, Suite 200, Omaha, Nebraska 68154 (the
"Purchaser") may acquire the estate created by the Ground Lease and assume the
obligations of Wellsford Capital Properties, L.L.C. ("Ground Lessee"), as lessee
thereunder. In that regard, Ground Lessor hereby ratifies and certifies to
Purchaser and to any lender financing Purchaser's acquisition of the estate
created by the Ground Lease (the "Lender") and to their respective successors
and/or assigns as follows:
1. The legal description of the premises subject to the Ground Lease is set
forth on Exhibit B annexed hereto.
2. The Ground Lease is in full force and effect and has not been modified
except as set forth on Exhibit A annexed hereto.
3. There is no security deposit held by the Ground Lessor under the Ground
Lease.
4. Ground Lessee has paid basic rent under the Ground Lease through .
5. Ground Lessor hereby consents to the assignment of the Ground Lease to
Purchaser.
6. Ground Lessor hereby consents to the existing use of the Premises.
7. Ground Lessee has no obligation to Ground Lessor with respect to the
Assigned Property, as defined in the Seventh Addendum to Joint Occupancy
Lease, dated as of (undated), 1993, by and among Ground Lessor, Midis
Properties, Limited and Santa Monica HSR Limited Partnership.
8. To Ground Lessor's knowledge, there are no outstanding claims of any kind
by Ground Lessor against Ground Lessee.
9. To Ground Lessor's knowledge, no event has occurred which may be considered
an event of default under the Ground Lease.
This certificate has been given to Purchaser with the understanding that
Purchaser and Lender shall rely thereon. The undersigned hereby certifies that
he or she is duly authorized to sign and deliver this Ground Lease Estoppel
Certificate.
Ground Lessor:
SANTA MONICA-MALIBU UNIFIED SCHOOL DISTRICT
By:
--------------------------------
Name:
Title:
Date: , 2000.
Exhibit A to Exhibit M
(the Ground Lease)
Joint Occupancy Lease, dated as of May 14, 1984, by and between Santa
Monica-Malibu Unified School District ("Lessor"), and City Developers, Inc.
("CDI"), with respect to certain property located at 1651 Sixteenth Street and
900 Colorado Avenue both in Santa Monica, California, which Lease was recorded
as Instrument No. 85-994306 and amended by a Confirmatory Memorandum of Joint
Occupancy Lease, dated April 18, 1988, and recorded as Instrument No. 88-557913.
The Ground Lease has been modified and assigned by the following addenda, letter
agreements and assignments.
1. First Addendum to Joint Occupancy Lease between Lessor and CDI dated as of
May 14, 1984 and executed on July 17, 1984;
2. Second Addendum to Joint Occupancy Lease between Lessor and CDI dated as of
May 14, 1984 and executed on July 17, 1984;
3. Assignment by CDI to Midis Properties, Ltd.("Midis") dated September 19,
1984 and recorded August 27, 1985 as Instrument No. 85-994307.
4. Third Addendum to Joint Occupancy Lease between Lessor and CDI effective
July 31, 1985;
5. Fourth Addendum to Joint Occupancy Lease between Lessor and CDI, dated July
1986;
6. Fifth Addendum to Joint Occupancy Lease between Lessor and CDI, dated July
1, 1986;
7. Letter agreement dated November 25, 1986 between Lessor and Midis;
8. Letter agreement dated October 21, 1987 between Lessor and Midis;
9. Sixth Addendum to Joint Occupancy Lease among Lessor, Midis and Santa
Monica HSR Limited Partnership ("HSR"), dated December 8, 1987;
10. Seventh Addendum to Joint Occupancy Lease among Lessor, Midis and HSR,
dated as of (undated) , 1993.
11. Assignment by Midis to CAM Properties, Inc. et al, by assignment dated
December 12, 1994 and recorded June 30, 1995 as Instrument No. 95-1050542,
and further assigned to Bay City Holdings, L.P. by assignment dated
December 12, 1994 and recorded June 30, 1995 as Instrument No. 95-1050543.
12. Assignment of Joint Occupancy Lease, dated October 21, 1998 by and between
Bay City Holdings, L.P. and Wellsford Capital Properties, L.L.C.
Exhibit B to Exhibit M
(Legal Description)
PARCEL I:
- ---------
THE PARCEL OF LAND IN THE RANCHO SAN VICENTE Y SANTA MONICA, IN THE CITY OF
SANTA MONICA, SHOWN AS PARCEL 11, THREE AND TWO HUNDRED SIXTY-TWO THOUSANDTHS
(3.262) ACRES, AND MARKED APEDRO CARL CARRILLO@ ON THE MAP ATTACHED TO THE
CERTIFIED COPY OF THE FINAL DECREE OF PARTITION IN CASE NO. B-25296 OF THE
SUPERIOR COURT OF SAID COUNTY, RECORDED IN BOOK 6387, PAGE 1 OF DEEDS, RECORDS
OF LOS ANGELES COUNTY, STATE OF CALIFORNIA.
PARCEL II:
- ----------
LOTS 13 AND 14 OF THE STANDARD TRACT, IN THE CITY OF SANTA MONICA, AS PER MAP
FILED IN BOOK 5, PAGE 83 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF LOS
ANGELES SAID COUNTY, CALIFORNIA.
ALSO THAT PORTION OF LOT 15 OF SAID STANDARD TRACT AND, THAT PORTION OF THE
RANCHO SAN VICENTE Y SANTA MONICA, RECORDED IN BOOK 3, PAGE 30 OF PATENTS, IN
THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY, DESCRIBED AS A WHOLE AS
FOLLOWS:
BEGINNING AT THE MOST NORTHERLY CORNER OF LOT 14 OF THE STANDARD TRACT, AS PER
MAP FILED IN BOOK 5, PAGE 83 OF MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF
LOS ANGELES COUNTY; THENCE SOUTH 44? 45' EAST ALONG THE NORTHEASTERLY LINE OF
SAID LOT 14 TO THE MOST EASTERLY CORNER OF SAID LOT 14; THENCE SOUTHWESTERLY
ALONG THE SOUTHEASTERLY LINE OF LOTS 13 AND 14 OF SAID STANDARD TRACT TO THE
MOST SOUTHERLY CORNER OF SAID LOT 13; THENCE SOUTH 44? 45' EAST ALONG THE
SOUTHEASTERLY PROLONGATION OF THE SOUTHWESTERLY LINE OF SAID LOT 13, 116.66
FEET, MORE OR LESS, TO A POINT IN A LINE DISTANT 30 FEET (MEASURED AT RIGHT
ANGLES) NORTHWESTERLY FROM AND PARALLEL TO THE SOUTHEASTERLY LINE OF SAID
STANDARD TRACT; THENCE NORTH 37? 26' EAST ALONG SAID PARALLEL LINE 50.44 FEET,
MORE OR LESS, TO ITS INTERSECTION WITH THE NORTHEASTERLY LINE OF SAID STANDARD
TRACT; THENCE SOUTH 44? 45' EAST ALONG SAID NORTHEASTERLY LINE 30.28 FEET, MORE
OR LESS, TO A POINT IN THE NORTHWESTERLY LINE 30.28 FEET MORE OR LESS, TO A
POINT IN THE NORTHWESTERLY RIGHT OF WAY LINE OF THE SOUTHERN PACIFIC COMPANY.
SAID POINT BEING ALSO THE MOST EASTERLY CORNER OF SAID STANDARD TRACT, THENCE
NORTH 37? 26' EAST 203.28 FEET, MORE OR LESS, ALONG SAID NORTHWESTERLY RIGHT OF
WAY LINE OF THE SOUTHERN PACIFIC COMPANY TO THE MOST SOUTHERLY CORNER OF THAT
CERTAIN 30 FOOT STRIP OF LAND CONVEYED TO LOS ANGELES PACIFIC RAILROAD COMPANY
BY E.P. CLARK IN BOOK 2805, PAGE 199 OF DEEDS; THENCE NORTH 44? 45' WEST 30 FEET
TO THE MOST WESTERLY CORNER OF SAID 30 FOOT STRIP OF LAND; THENCE NORTHEASTERLY
235.90 FEET, MORE OR LESS, ALONG THE NORTHWESTERLY LINE OF SAID 30 FOOT
STRIP OF LAND TO A POINT IN THE SOUTHEASTERLY PROLONGATION OF THE NORTHEASTERLY
LINE OF TENTH STREET , 80 FEET WIDE; THENCE NORTHWESTERLY ALONG SAID PROLONGED
LINE OF 140.4 FEET, MORE OR LESS, TO A POINT IN THE SOUTHEASTERLY LINE OF
COLORADO AVENUE (FORMERLY RAILROAD AVENUE) 80 FEET WIDE; THENCE SOUTHWESTERLY
ALONG THE SOUTHEASTERLY LINE OF SAID COLORADO AVENUE 435.10 FEET, MORE OR LESS,
TO THE POINT OF BEGINNING.
Exhibit N
(Form of Tenant Estoppel Certificate)
, 2000
-----------
Landlord: Wellsford Capital Properties, L.L.C.
Tenant:
Original Lease Date: .
The undersigned Tenant under the above-referenced Lease (the "LEASE") hereby
ratifies and certifies to DIAL ADVISORY GROUP, INC., a Nebraska corporation
having an office at 11506 Nicholes Street, Suite 200, Omaha, Nebraska 68154
("PURCHASER"), as the prospective purchaser of the real property commonly known
as 1651 Sixteenth Street and 900 Colorado Boulevard, Santa Monica, California
(the "PROPERTY") of which the premises demised under the Lease is a part (the
"PREMISES"), and to any lender providing financing to Purchaser in connection
with its acquisition of such real property ("LENDER"), and to their respective
successors and/or assigns, as follows:
1. The CURRENT term of the Lease commenced on ____________ and expires on
__________. Tenant has accepted and is in possession of the Premises.
2. The Lease presently calls for monthly installments of fixed or base rent of
$___________.
4. _______ Rent has been paid to and including ____________, 2000, and no
advance rental or other payment has been made in connection with the Lease,
except rental for the current month. Tenant has no defenses or set-offs to
the payment of rent.
5. A security deposit in the amount of $ _________ is being held by Landlord.
6. There is no existing event of default on the part of the Landlord or the
Tenant in any of the terms and conditions of the Lease.*
7. The Lease is valid and in full force and effect and represents the entire
agreement between the parties, and the Lease has (check one):
( ) not been amended, modified, supplemented, extended, renewed or
assigned.
( ) been amended, modified, supplemented, extended, renewed or
assigned as follows by the following described agreements:
_______________________________________________.
8. As of the date hereof, Landlord has fully performed all of its obligations
under the Lease and satisfied all commitments made to induce Tenant to
enter into the Lease
- ----------
* Will accept modified to Tenant's knowledge as to Landlord default.
and Tenant is not entitled to any rental inducements, "free rent", rent
allowance, rent credits or other concession or economic inducements in
connection with the Lease throughout the remainder of the term except as
follows:
---------------------------------------------------------------------------
---------------------------------------------------------------------------
---------------------------------------------------------------------------
--------------------------------------------------.
9. All construction, build-out, improvements, or alterations to the Premises
required under the Lease have been fully completed in accordance with the
plans and specifications described in the Lease and all contributions
required to be made by Landlord throughout the term of the Lease on account
thereof have been made except as follows:
---------------------------------------------------------------------------
---------------------------------------------------------------------------
---------------------------------------------------------------------------
--------------------------------------------------.
10. There are no actions, voluntary or involuntary, pending against the Tenant
under the bankruptcy laws of the United States or any state thereof.
11. Tenant has no renewal, extension, cancellation or expansion rights under
the Lease, except to the extent expressly set forth in the Lease.
12. Tenant has no right of first offer or refusal with respect to, or other
option to purchase, all or any portion of the Premises.
13. Tenant has not assigned, transferred or pledged the Lease or any interest
therein or sublet any portion thereof except as follows:
This certificate has been given to Purchaser and Lender with the
understanding that Purchaser is acquiring the Property in reliance on this
Tenant Estoppel Certificate and Lender will rely hereon in connection with loans
which will be secured by the Property. The undersigned hereby certifies that he
or she is duly authorized to sign and deliver this Tenant Estoppel Certificate.
Tenant:
Date: _________, ______. By:_____________________________________
Name:
Title:
Exhibit O
(Rent Roll)
Exhibit P
(Representation Disclosure Statement)
1. Seller has commenced an unlawful detainer action against a tenant at the
Premises, G. Ray Hawkins. As of the commencement of the unlawful detainer
action, the tenant was in arrears in the payment of Fixed Rent and Overage
Rent in the amount of $32,338.98. The commencement of the unlawful detainer
action was preceded by Seller's delivery to the tenant of a notice to pay
rent or surrender possession of the premises demised under the lease, dated
November 8, 2000.
2. The tenant under the Anti Gravity Products lease is in arrears in the
payment of Fixed Rents and Overage Rents for a period of two months.
Exhibit P-1
(Violations)
1. Violations noted on Test 19 Inspection - 5 year Test Results, reporting
results of inspection of 16th Street Premises conducted on March 9, 2000.
2. Violations noted on Title 19 Inspection - 5 year Test Results, reporting
results of inspection of Colorado Avenue Premises conducted on June 6,
2000.
Exhibit Q
(Insurance Coverage)
Exhibit R
(Permitted Exceptions)
1. The Ground Lease.
2. The Leases and the rights of tenants thereunder, including, without
limitation, memoranda of the Leases.
3. Zoning and building regulations, ordinances, and requirements adopted by
any governmental or municipal authority having jurisdiction thereof, and
amendments and additions thereto now in force and effect, which relate to
the Premises.
4. Any agreements, financing statements, chattel mortgages, liens or
encumbrances entered into by, or arising from, the acts of any tenant.
5. Subject to adjustment as herein provided, real estate taxes, tax liens,
water and sewer charges, assessments and vault charges, and the liens of
any of the foregoing.
6. An easement for the purpose shown below and rights incidental thereto as
set forth in a document.
Purpose: public utilities
Recorded: December 4, 1950
Instrument/File No.: 2491, Official Records
Affects: a portion of said land, as more particularly
described in said document
7. Covenants, conditions and restrictions as set forth in the document.
Recorded: May 27, 1958
Instrument/File: 2817, Official Records
8. An easement for the purpose shown below and rights incidental thereto as
set forth in a document.
Granted to: General Telephone Company of California, a
corporation
Purpose: public utilities
Recorded: September 7, 1965
Instrument/File No.: 2574, Official Records
Affects: a portion of said land, as more particularly
described in said document
9. An easement for the purpose shown below and rights incidental thereto as
set forth in a document.
Granted to: Southern California Edison Company, a
corporation, its successors and/or assigns
Purpose: public utilities
Recorded: October 9, 1986
Instrument/File No.: 86-1363248 Official Records
Affects: a portion of said land, as more particularly
described in said document
10. The effect of "Certificate of Interest in Real Property"
Dated: September 24, 1990
Executed by: William J. Anthony - Directors of General
Services State of California
In favor of: not shown
Recorded: October 5, 1990 as Instrument
No. 90-1705280, Official Records
Among other things, said document provides for:
The Director of General Services of the State of California hereby
certifies that the State of California has an interest by Virtue of Funds
Apportioned under the Leroy F. Greene Lease-Purchase Law of 1976 (CH. 22.
Part 10 Div. 1 ED Code) in Real Property of the following named School
District:
Name of School District: Santa Monica - Malibu Unified
Address: 1651 16th Street, Santa Monica, California 90404
Notice is hereby given pursuant to said Section 17730 that this
Certificate has the same force, effect, and priority as a Judgment Lien
Imposed upon real property not exempt from execution, as to any party
hereafter acquiring real property from said School District, unless
discharged or released as provided in said Section.
Reference is made to said document for full particulars.
11. An unrecorded lease with certain terms, covenants, conditions and
provisions set forth therein:
Lessor: The Bay City Holdings LP
Lessee: Direct Partners, a limited liability Company
Disclosed by: Notice of Non-Responsibility
Recorded: August 15, 1997
Instrument/File No.: 97-1268525 Official Records
The present ownership of the leasehold created by said lease and other
matters affecting the interest of the lessee are not shown herein.
12. Water rights, claims or title to water, whether or not shown by the public
records.
13. State of facts as disclosed by the Surveys.
14. An unrecorded lease with certain terms, covenants, conditions and
provisions set forth therein.
Lessor: Wellsford Capital Properties, LLC
Lessee: American Medical Response of Southern
California
Disclosed by: Notice of Non-Responsibility
Recorded: October 10, 2000
Instrument/File No. 00-1585619 Official Records
15. An unrecorded lease with certain terms, covenants, conditions and
provisions set forth therein.
Lessor: Wellsford Capital Properties, LLC
Lessee: Interior Spaces, Inc.
Disclosed by: Notice of Non-Responsibility
Recorded: October 10, 2000
Instrument/File No.: 00-1585620 Official Records.
FIRST AMENDMENT
TO SALE-PURCHASE AGREEMENT
AND JOINT ESCROW INSTRUCTIONS
THIS FIRST AMENDMENT TO SALE-PURCHASE AGREEMENT AND JOINT ESCROW
INSTRUCTIONS (this "AGREEMENT") dated as of December 18, 2000 between WELLSFORD
CAPITAL PROPERTIES, L.L.C, a Delaware limited liability company having an
address c/o Wellsford Real Properties, Inc. 535 Madison Avenue, 26th Floor, New
York, New York 10022 ("SELLER") and DIAL ADVISORY GROUP, INC., a Nebraska
corporation having an address at 11506 Nicholes Street, Suite 200, Omaha,
Nebraska 68154 ("PURCHASER").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, Seller and Purchaser entered into a Sale-Purchase Agreement and
Joint Escrow Instructions (the "PURCHASE AGREEMENT") dated December 8, 2000, as
modified by letter agreement dated December 13, 2000, with respect to Seller's
leasehold estate in certain premises known as 900 Colorado Avenue and 1651
Sixteenth Street, Santa Monica, California; and
WHEREAS, Seller and Purchaser wish further to modify the Purchase Agreement
in the manner hereinafter set forth.
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, Seller and Purchaser hereby agree as follows:
1. Defined Terms. Capitalized terms used herein and not otherwise defined
shall have the meanings ascribed thereto in the Purchase Agreement.
2. Waiver of Due Diligence Contingency. Purchaser acknowledges that
Purchaser has satisfactorily completed its due diligence investigations of the
Property and hereby waives its right to terminate the Purchase Agreement in
accordance with the provisions of Section 4.1 thereof.
3. Purchase Price. Section 3.1 of the Purchase Agreement is hereby modified
so that, in lieu of $16,550,000, the Purchase Price set forth therein shall be
$16,419,425.
4. Title. Seller acknowledges receipt from Bryan Cave, Purchaser's counsel,
of a letter dated December 18, as to matters affecting title to the Property.
Seller further acknowledges that such letter shall constitute a ATitle Objection
Notice,@ as that term is defined in the Purchase Agreement, which Title
Objection Notice was timely received in accordance with the terms of the
Purchase Agreement.
5. Estoppel Certificates. Section 5.2(b) of the Purchase Agreement is
hereby modified so that, in lieu of not being required to obtain a Tenant
Estoppel Certificate from the tenant under the G. Ray Hawkins Lease, Seller
shall not be required to obtain a Tenant Estoppel Certificate from the tenant
under the Laurant Beverly Hills lease.
6. Rent Roll. The rent roll annexed to the Purchase Agreement as Exhibit O
is hereby deleted in its entirety and replaced with Exhibit O annexed hereto.
7. Miscellanous.
(a) The Purchase Agreement, as amended by this Agreement, shall
continue in full force and effect and is hereby ratified in all respects.
(b) This Agreement shall bind, and inure to the benefit of, the
parties hereto and their respective successors and assigns.
(c) This Agreement shall not be modified orally, but only by an
agreement in writing executed by Seller and Purchaser.
(d) This Agreement shall be governed by and construed in accordance
with the laws of the State of California, without giving effect to the
conflict of law principles thereof.
(e) This Agreement may be executed in counterparts, each of which
shall constitute an original and all of which, when taken together, shall
constitute but one and the same agreement.
(f) This Agreement may be executed and delivered by facsimile.
IN WITNESS WHEREOF, Seller and Purchaser have entered into this
Agreement as of the date and year first above written.
SELLER:
WELLSFORD CAPITAL PROPERTIES,
L.L.C.
By: Wellsford Capital, its Manager
By:
----------------------
William H. Darrow
Vice President
PURCHASER:
DIAL ADVISORY GROUP, INC.
By:
----------------------
Name:
Title:
EXHIBIT O
(Rent Roll)