AGREEMENT OF PURCHASE AND SALE
between
Brandywine Operating Partnership, L.P., Purchaser,
and
RREEF MidAmerica/East Fund-IV, Seller
741 First Avenue
King of Prussia, Upper Merion Township, Montgomery County, Pennsylvania
Table of Contents
1. Purchase Price.. . . . . . . . . . . . . . . . . . . . . . . . . . 1
2. Deposit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
3. Review of the Property.. . . . . . . . . . . . . . . . . . . . . . 2
4. Title and Survey.. . . . . . . . . . . . . . . . . . . . . . . . . 3
5. Representations and Warranties.. . . . . . . . . . . . . . . . . . 4
5.1 Representations and Warranties of Seller.. . . . . . . . 4
5.2 Representations and Warranties of Purchaser. . . . . . . 7
5.3 Limitations. . . . . . . . . . . . . . . . . . . . . . 7
5.4 Condition of Property. . . . . . . . . . . . . . . . . . 8
6. Closing Conditions.. . . . . . . . . . . . . . . . . . . . . . . . 8
6.1 Title Insurance. . . . . . . . . . . . . . . . . . . . . 8
6.2 Estoppel Letters . . . . . . . . . . . . . . . . . . . . 8
6.3 Representations and Warranties . . . . . . . . . . . . . 9
6.4 Seller Performance . . . . . . . . . . . . . . . . . . . 9
7. Other Agreements.. . . . . . . . . . . . . . . . . . . . . . . . . 9
8. Closing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
8.1 Closing of Sale. . . . . . . . . . . . . . . . . . . . . 10
8.2 Prorations; Adjustments. . . . . . . . . . . . . . . . . 10
8.3 Proration of Service Charges.. . . . . . . . . . . . . . 11
8.4 Closing Costs. . . . . . . . . . . . . . . . . . . . . . 12
8.5 Possession.. . . . . . . . . . . . . . . . . . . . . . . 12
8.6 Seller's Closing Documents.. . . . . . . . . . . . . . . 12
8.7 Purchaser's Closing Documents. . . . . . . . . . . . . . 13
8.8 Joint Deliveries.. . . . . . . . . . . . . . . . . . . . 14
9. Miscellaneous. . . . . . . . . . . . . . . . . . . . . . . . . . . 14
9.1 Modifications. . . . . . . . . . . . . . . . . . . . . . 14
9.2 Casualty and Condemnation. . . . . . . . . . . . . . . . 14
9.3 Time of Essence. . . . . . . . . . . . . . . . . . . . . 14
9.4 Notices. . . . . . . . . . . . . . . . . . . . . . . . . 14
9.5 Parties Bound. . . . . . . . . . . . . . . . . . . . . . 16
9.6 Governing Law. . . . . . . . . . . . . . . . . . . . . . 16
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9.7 Continuation Until Closing; Leasing. . . . . . . . . . . 16
9.8 Brokers. . . . . . . . . . . . . . . . . . . . . . . . . 16
9.9 Attorneys' Fees. . . . . . . . . . . . . . . . . . . . . 17
9.10 Remedies for Non-Performance.. . . . . . . . . . . . . . 17
9.11 Brokers Commission.. . . . . . . . . . . . . . . . . . . 17
9.12 Survival of Covenants. . . . . . . . . . . . . . . . . . 17
9.13 Seller's Investment Committee Approval.. . . . . . . . . 17
9.14 ERISA. . . . . . . . . . . . . . . . . . . . . . . . . . 17
9.15 Entry and Indemnity. . . . . . . . . . . . . . . . . . . 18
9.16 Release. . . . . . . . . . . . . . . . . . . . . . . . . 18
9.17 Confidential Information. . . . . . . . . . . . . . . . 19
9.18 Calculation of Time Periods. . . . . . . . . . . . . . . 19
9.19 Entire Agreement.. . . . . . . . . . . . . . . . . . . . 19
9.20 Severability.. . . . . . . . . . . . . . . . . . . . . . 20
9.21 Facsimile Signatures.. . . . . . . . . . . . . . . . . . 20
9.22 Further Assurances.. . . . . . . . . . . . . . . . . . . 20
9.23 Offer. . . . . . . . . . . . . . . . . . . . . . . . . . 20
9.24 Seller Exculpation Clause. . . . . . . . . . . . . . . . 20
9.25 Purchaser Exculpation Clause.. . . . . . . . . . . . . . 21
9.26 SEC Reporting (8-K) Requirements.. . . . . . . . . . . . 21
List of Schedules and Exhibits. . . . . . . . . . . . . . . . . . . . . 23
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AGREEMENT OF PURCHASE AND SALE
BRANDYWINE OPERATING PARTNERSHIP, L.P., a Delaware limited partnership
("Purchaser") agrees to purchase, and RREEF MIDAMERICA/EAST FUND-IV, a
California group trust ("Seller") agrees to sell, that certain improved real
property, hereinafter referred to as the "Property", situated in the City of
King of Prussia, Upper Merion Township, Montgomery County, Commonwealth of
Pennsylvania, legally described on Exhibit A attached hereto and made a part
hereof, consisting of a single parcel of real estate improved with a building
commonly known as 741 First Avenue, King of Prussia, Pennsylvania, together
with all rights, privileges, easements and appurtenances thereto, including
any and all mineral rights, development rights, air rights, and the like; all
personal property owned by the Seller and located on or used in conjunction
with the Property (specifically excluding furniture, fixtures and equipment
owned by RREEF Management Company and located in the RREEF Management Company
office); any and all intangible personal property owned by Seller and used in
the operation of the Property, including the right to use the name of the
property (but not the name "RREEF"), to the extent assignable, but excluding
computer software and related licenses; contract rights, "Leases" of all or
any part of the Property, all licenses, permits and other written
authorizations necessary for the use, operation and ownership of the
Property, records, security deposits and prepaid rent, if any, and the
benefit of any guaranties of the Leases.
1. Purchase Price. The purchase price for the Property ("Purchase
Price") is Six Million Three Hundred Forty Thousand Dollars ($6,340,000.00),
payable by wire transfer of immediately available funds at Closing as defined
in Paragraph 8.1.
2. Deposit.
2.1 Purchaser has previously deposited, pursuant to this Agreement
and pursuant to the Other Agreements (defined in Paragraph 7 below), the
amount of Five Hundred Fifty Thousand Dollars ($550,000.00) (the "Deposit")
with Commonwealth Land Title Insurance Company ("Escrow Holder") as earnest
money to secure Purchaser's performance hereunder and under the Other
Agreements. The Deposit may be invested at the direction of Purchaser with
the approval of Seller. All investment income earned from the investment of
the Deposit, less investment fees, if any, will be added to and become a part
of the Deposit and will be applied toward the Purchase Price under the KOP
Agreement (defined in Paragraph 7) if Closing is completed in accordance with
this Agreement; otherwise all interest will be paid to the party entitled to
the Deposit. The escrow instructions to Escrow Holder will be in the form of
Schedule 2.1 attached hereto (the "Escrow Instructions"). If Purchaser does
not elect to terminate this Agreement pursuant to Section 3 below, prior to
the end of the Review Period (defined in Section 3.4), on or before one
business day after last day of the Review Period Purchaser shall deposit an
additional $500,000 with Escrow Holder, which shall be added to and become a
part of the Deposit for all purposes hereunder.
2.2 Of the total Deposit, the sum of $150,000 is agreed to be
non-refundable, and shall be refunded to Purchaser only (i) if Purchaser
terminates this Agreement under Section 3.4, under the circumstances set
forth in Section 3.4.1, or (ii) if the Agreement is terminated or if the
Closing fails to occur by reason of Seller's default. Under all other
circumstances, wherever under this Agreement and the Other Agreements the
Deposit is to be returned to Purchaser, $150,000 out of the Deposit shall be
paid to Seller, to be retained by Seller as fully earned.
3. Review of the Property.
3.1 From and after the "Effective Date" (as defined in Paragraph
9.23), Seller agrees to provide Purchaser and its agents or consultants with
access to the Property to inspect each and every part thereof to determine
its present condition and to conduct such physical and environmental studies
(including a mechanical and roof study and Phase I environmental assessment)
as it deems appropriate.
3.2 Within three (3) business days after the Effective Date Seller
will make available to Purchaser for inspection and copying, all to the
extent in the possession of Seller or its managing agent, a copy of each
existing Lease and equipment lease, service contract and maintenance or other
contract pertaining to the operations of the Property that will survive
Closing, a copy of each real estate tax bills for 1994-1996, both inclusive,
and unaudited financial statements for the Property for the years 1994-1996,
both inclusive.
3.3 Within three (3) business days after the Effective Date Seller
will make available to Purchaser for inspection and copying at the office of
Seller's managing agent, all to the extent in the possession of Seller or its
managing agent:
3.3.1 a copy of each environmental reports relating to the
Property prepared by third party consultants since January 1, 1995.
3.3.2 a copy of each current franchises, business or other
licenses, bonds, permits, certificates, authorizations and other evidences of
consent, approval, authorization or permission relating to or affecting the
Project of or from any person, including any governmental authority, held by
Seller, including any pending applications.
3.3.3 a copy of each material third party warranties and
guaranties, if any, which are in effect with respect to the Property.
3.4 Purchaser has until 5:00 p.m. CST on February 2, 1998 (the
"Review Period"), to determine in its sole discretion whether all matters
relating to the Property (except title and survey, which are governed by
Paragraph 4), are acceptable, and to obtain the approval of the transaction
contemplated herein by Seller's Board of Directors. If Purchaser concludes
that any matter relating to the Property is not acceptable or that its Board
has disapproved the
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transaction, Purchaser will so notify Seller (the "Termination Notice") prior
to the expiration of the Review Period (which notice shall contain a copy of
Purchaser's roof/structural report and other reports or studies, other than
environmental reports, obtained in connection with Purchaser's due
diligence). Upon timely delivery of the Termination Notice, this Agreement
will terminate without liability on the part of Seller or Purchaser, other
than Purchaser's indemnity contained in Paragraph 9.15 hereof and the
obligation to deliver to Seller a copy of any environmental report obtained
by Purchaser if requested by Seller within ten (10) days after receipt of the
Termination Notice. In the event that Purchaser does not timely so notify
Seller, Purchaser will be deemed to have concluded that all matters relating
to the Property are acceptable and to have elected to proceed with the
transaction upon the terms and conditions contained in this Agreement
(including the obligation to increase the amount of the Deposit by an
additional $500,000) without regard to this Paragraph 3.4.
3.4.1 If this Agreement is terminated pursuant to
Paragraph 3.4, the Deposit, less $150,000, will be returned to Purchaser as
provided in the Escrow Instructions. This $150,000 shall be paid to Seller,
unless Purchaser's termination resulted from (i) Seller's default, (ii) a
material deviation from the economics of the Property as presented in
Seller's offering memorandum (it being understood and agreed that Seller
makes no warranty or representation as to said offering memorandum), or (iii)
any material structural or environmental defect in the Property not known or
disclosed to Purchaser before December 22, 1997.
3.5 Purchaser agrees that any information obtained by Purchaser or
its authorized agents in the conduct of its due diligence will be treated as
confidential pursuant to Paragraph 9.17.
4. Title and Survey. Purchaser has ordered, at its expense (and upon
receipt, Purchaser shall promptly deliver copies to Seller): (i) a commitment
for a 1992 form ALTA Owner's title insurance policy with respect to the
Property from Commonwealth Land Title Insurance Company (the "Title Insurer")
in the amount of the Purchase Price, and (ii) copies of all documents
relating to title exceptions referred to therein. Seller has already
ordered, and Purchaser has received, at Purchaser's sole expense, a plat of
survey of the Property made in accordance with Minimum Standard Detail
Requirements for ALTA/ACSM Land Title Surveys (1992) pursuant to the accuracy
standards of an Urban Survey. On or before January 30, 1998, Purchaser
agrees to notify Seller of any objection Purchaser may have to any exceptions
reported in the commitment or any matter shown on the plat of survey (the
"Unacceptable Exceptions"). Seller will be responsible for satisfaction of
the Title Insurer's Schedule B-1 seller requirements. All other exceptions
and survey matters will be deemed acceptable to Purchaser. If Purchaser
fails to give such notice to Seller, the survey and all of the exceptions in
the title commitment will be deemed acceptable to Purchaser. Seller will
have ten (10) days after receipt of Purchaser's notice within which to notify
Purchaser whether Seller elects to either (a) eliminate or induce the Title
Insurer to insure over (subject to Purchaser's consent, not to be
unreasonably withheld) the Unacceptable Exceptions or (b) terminate this
Agreement. If Seller agrees to eliminate or induce to the Title Insurer to
insure over (with Purchaser's consent) the
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Unacceptable Exceptions, Seller will be obligated to do so at its cost on or
prior to Closing. If Seller elects to terminate this Agreement, neither
party will have any further rights or obligations hereunder, except as
provided in Paragraph 9.15. If Seller fails to give any timely notice,
Seller will be deemed to have elected to terminate this Agreement. If any
other recorded exception to title is discovered after the commitment is
delivered to Purchaser, and Purchaser does not elect to waive such exception
upon the first to occur of (a) the Closing or (b) seven (7) days after being
notified of such exception and to proceed with the consummation of the
Closing, Seller will have fifteen (15) days after the expiration of said
seven (7) day period (and Closing will be delayed if necessary, so that it
occurs not earlier than twenty-two (22) days after Purchaser is notified of
such exception) after notifying Purchaser of such discovery in which to use
commercially reasonable efforts to eliminate or to induce the Title Insurer
to insure over (subject to Purchaser's approval, not to be unreasonably
withheld) such exception, and if such exception is not eliminated or insured
over as aforesaid within said 15-day period, Purchaser may terminate this
Agreement, in which event the Deposit will be returned to Purchaser and
neither party will have any further rights or obligations hereunder except as
provided in Paragraph 9.15, or close the sale subject to such exception.
Seller agrees that it will pay off at Closing (and not induce the Title
Insurer to insure over) title exceptions representing monetary liens of a
definite or ascertainable amount voluntarily granted by Seller. In using
commercially reasonable efforts to eliminate or to induce the Title Insurer
to insure over Unacceptable Exceptions, Seller will not be required to
litigate or to expend more than $10,000 in the aggregate. Ad valorem real
estate taxes not yet due and payable and all title and survey matters which
are not Unacceptable Exceptions are hereinafter referred to as Acceptable
Exceptions.
5. Representations and Warranties.
5.1 Representations and Warranties of Seller. As used in this
Paragraph 5.1 and elsewhere in this Agreement, the phrase "to the knowledge
of Seller" or phrases of similar import mean and are limited to the actual
current knowledge, without duty to investigate or inquire, of Seller's
portfolio manager (Pamela Boneham) and Seller's local manager having ongoing
management responsibility with respect to the Property (Barbara Gillentine),
and not to any constructive knowledge of any of the foregoing individuals or
of Seller or any investment advisor to Seller, any entity that is a partner
in such investment advisor, or any affiliates of any thereof, or to any
officer, agent, representative, or employee of Seller or such investment
advisor, any such constituent partner, or any such affiliate. Seller hereby
warrants and represents to Purchaser (with such representations and
warranties to be re-made as of Closing pursuant to Paragraph 8.6.10) as
follows:
5.1.1 Pending Proceedings. With the exception of the
items set forth in Schedule 5.1 (the "Disclosure Schedule") to the knowledge
of Seller, Seller has received no written notice of special assessments,
condemnation, environmental, zoning or other land use regulation proceedings,
either pending or planned to be instituted, with respect to the Property or
any part thereof.
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5.1.2 Status of Seller and Closing Documents. Subject to
Paragraph 9.13, this Agreement has been, and all the closing documents to be
delivered by Seller to Purchaser at Closing are or will be, duly authorized,
executed, and delivered by Seller, will be sufficient to convey insurable
title, are legal, valid, and binding obligations of Seller, are enforceable
in accordance with their respective terms, and do not violate any provisions
of any agreement to which Seller or the Property is subject or bound. Seller
is duly organized and validly existing and, if required, duly qualified to
transact business in the State in which the Property is located.
5.1.3 Non-Foreign Status. Seller is not a foreign person
within the meaning of Section 1445(f)(3) of the Internal Revenue Code of
1986, as amended.
5.1.4 Compliance with Laws. With the exception of the
items set forth in the Disclosure Schedule, Seller has received no
governmental notice, not heretofore corrected, alleging that the Property or
its current uses are in violation of any zoning, building, health, traffic,
environmental, flood control or all other applicable rules, regulations,
codes, ordinances, or statutes of any local, state and federal authorities or
any other governmental authority (collectively, the "Laws") asserting
jurisdiction over the Property.
5.1.5 Service Contracts. With the exception of the items
set forth in the Disclosure Schedule, to Seller's knowledge, there are no
agreements or contracts affecting the Property (including, without
limitation, any management, leasing, services or maintenance agreements)
which are not terminable at will by Seller without further liability, upon
not more than 30 days' prior written notice. The contracts and agreements to
be assigned to Purchaser pursuant to Paragraph 8.6.5 are listed on Schedule
5.1.5 attached hereto. Seller agrees to terminate the existing management
agreement covering the Property on or before Closing.
5.1.6 No Default. The execution and delivery of this
Agreement, and consummation of the transaction described in this Agreement,
does not and will not constitute a default under any contract, lease, or
agreement to which Seller is a party or by which Seller is bound.
5.1.7 No Suits. Except as set forth in the Disclosure
Schedule and except for personal injury or property damage actions for which
there is adequate insurance coverage and where the insurance carrier has
accepted the tender of the defense without reservation, to Seller's
knowledge, there is no action, suit or proceeding pending or threatened
against or affecting the Property or any portion thereof, or relating to or
arising out of the ownership, management or operation of the Property, in any
court or before or by any federal, state, or municipal department,
commission, board, bureau or agency or other governmental instrumentality.
5.1.8 Environmental Condition. Each of the following
representations contained in this Paragraph 5.1.8 is wholly qualified and
limited by (a) any matters disclosed in
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any materials made available or delivered to Purchaser by Seller pursuant to
Paragraph 3 above or otherwise, (b) any matters disclosed in any
environmental reports or studies obtained by Purchaser, and (c) any other
matters of which Purchaser has actual knowledge. Subject to the foregoing,
Seller represents:
5.1.8.1 With the exception of items listed in the
Disclosure Schedule, and except (i) in amounts customarily found in office
uses and in the other uses for which the Property is suited and used and (ii)
in compliance with applicable law, to Seller's knowledge, Seller has not
released, generated or handled Hazardous Materials on the Property, and
Seller has no knowledge of any release, generation or handling of Hazardous
Materials on the Property by any tenants or the incorporation of Hazardous
Materials by the tenants in any improvements on the Property during the time
Seller owned the Property. For the purposes hereof, "Hazardous Material"
means any substance, chemical, waste or other material which is listed,
defined or otherwise identified as "hazardous" or "toxic" under any federal,
state, local or administrative agency ordinance or law, including, without
limitation, the Comprehensive Environmental Response, Compensation and
Liability Act, 42 U.S.C. Sections 9601 et seq. and the Resource Conservation
and Recovery Act, 42 U.S.C. Sections 6901 et seq., or any regulation, order,
rule or requirement adopted hereunder, as well as any formaldehyde, urea,
polychlorinated biphenyls, petroleum, petroleum product or by-product, crude
oil, natural gas, natural gas liquids, liquefied natural gas, or synthetic
gas usable for fuel or mixture thereof, radon, asbestos, and "source,"
"special nuclear" and "by-product" material as defined in the Atomic Energy
Act of 1985, 42 U.S.C. Sections 3011 et seq.
5.1.8.2 With the exception of items listed in the
Disclosure Schedule, to Seller's knowledge, Seller has not received any
summons, citation, directive, letter or other communication, written or oral,
from the United States Environmental Protection Agency or the State
environmental protection agency having jurisdiction over the Property.
5.1.9 Options. Seller has granted no options or rights of
first refusal to acquire any interest in the Property not set forth in the
Leases delivered to Purchaser or in documents of record disclosed in the
title commitment.
5.1.10 Rent Roll. To Seller's knowledge, the information
set forth on the rent roll attached hereto as Schedule 5.1.10 is true and
accurate in all material respects.
5.1.11 Tenant Rights. There are no termination, extension,
cancellation, or expansion rights under any occupancy arrangements with
respect to the Property except as contained in the Leases.
5.1.12 Leasing Commissions. All leasing commissions, free
rent and tenant improvement allowances due and payable as of the date hereof
by Seller have been paid or will have been paid on or before Closing. To
Seller's knowledge, the only current leases as to
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which commissions, free rent and tenant improvement allowances may become due
in the future are listed on Schedule 5.1.12, which future obligations shall
be expressly assumed by Purchaser.
5.1.13 There are no employees of the Property or Seller who
will become employees of Purchaser or for which Purchaser shall be
responsible in any way.
5.2 Representations and Warranties of Purchaser. Purchaser hereby
represents and warrants to Seller that this Agreement has been, and all the
documents to be delivered by Purchaser to Seller will be, duly authorized,
executed, and are or will be legal, valid, and binding obligations of
Purchaser, are or will be enforceable in accordance with their respective
terms, and do not and will not at Closing violate any provisions of any
agreement to which Purchaser is subject.
5.3 Limitations. Each of the representations and warranties of
Seller contained in Paragraph 5.1: (i) is made as of the date of this
Agreement; (ii) will be deemed to be remade by Seller, and to be true in all
material respects, as of Closing, subject to other matters expressly
permitted in this Agreement or otherwise specifically approved in writing by
Purchaser; and (iii) will survive for a period of one (1) year after the
Closing Date, as defined in Paragraph 8.1. Any claim that Purchaser may have
at any time against Seller for a breach of any such representation or
warranty, whether known or unknown, which is not asserted by notice from
Purchaser to Seller within such six (6) month period will not be valid or
effective, and Seller will have no liability with respect thereto. Nor will
Seller have any liability to Purchaser for a breach of any representation or
warranty unless the valid claims for all such breaches collectively aggregate
more than One Hundred Thousand Dollars ($100,000.00), in which event the full
amount of such valid claims shall be actionable, subject to the limitation in
Section 9.10. The continued accuracy in all material respects of the
aforesaid representations and warranties is a condition precedent to
Purchaser's obligation to close. If any of said representations and
warranties is not correct in all material respects at the time the same is
made or as of Closing, and Seller had no knowledge of such inaccuracy when
the representation or warranty was made, or when remade at Closing, or if
such warranty or representation becomes inaccurate on or prior to Closing
other than by reason of Seller's default hereunder, Purchaser may, upon being
notified of such occurrence on or prior to Closing either (a) terminate this
Agreement without liability on the part of Seller or Purchaser, other than
Purchaser's indemnity contained in Paragraph 9.15 and the Deposit will be
returned to Purchaser, or (b) waive such matter and proceed to Closing, by
notice to Seller given within ten (10) days after Purchaser is notified of
such occurrence, but in no event later than Closing. If Purchaser fails to
give any notice within the required time period, Purchaser will be deemed to
have elected to waive such matter and to proceed to Closing. If any of said
representations and warranties are not correct in all material respects at
the time the same is made or as of Closing, and Seller had knowledge of such
inaccuracy when the representation or warranty was made, or, by its default
hereunder caused the representation or warranty to be inaccurate when remade
at Closing, Purchaser may either (x) terminate this Agreement subject to its
obligations under Paragraph 9.15, receive a return of the Deposit and recover
from Seller all of Purchaser's actual, reasonable out-of-pocket costs
incurred in connection with its review of
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the Property or (y) waive the breach and its rights under clause (x) and
proceed to Closing, by notice to Seller given within ten (10) days after
Purchaser is notified of such occurrence, but in no event later than Closing.
If Purchaser fails to give any notice within the required time period,
Purchaser will be deemed to have elected to waive such matter and to proceed
to Closing.
5.4 Condition of Property. Except as expressly set forth in this
Agreement, Seller has not made and does not hereby make any representations,
warranties or other statements as to the condition of the Property and
Purchaser acknowledges that at Closing it is purchasing the Property on an
"AS IS, WHERE IS" basis and without relying on any representations and
warranties of any kind whatsoever, express or implied, from Seller, its
agents or brokers as to any matters concerning the Property. Except as
expressly set forth in this Agreement, no representations or warranties have
been made or are made and no responsibility has been or is assumed by Seller
or by any partner, officer, person, firm, agent or representative acting or
purporting to act on behalf of Seller as to the condition or repair of the
Property or the value, expense of operation, or income potential thereof or
as to any other fact or condition which has or might affect the Property or
the condition, repair, value, expense of operation or income potential of the
Property or any portion thereof. The parties agree that all understandings
and agreements heretofore made between them or their respective agents or
representatives are merged in this Agreement and the Schedules and Exhibits
hereto annexed, which alone fully and completely express their agreement, and
that this Agreement has been entered into after full investigation, or with
the parties satisfied with the opportunity afforded for investigation,
neither party relying upon any statement or representation by the other
unless such statement or representation is specifically embodied in this
Agreement or the Exhibits annexed hereto. Purchaser acknowledges that Seller
has requested Purchaser to inspect fully the Property and investigate all
matters relevant thereto and, with respect to the condition of the Property,
to rely solely upon the results of Purchaser's own inspections or other
information obtained or otherwise available to Purchaser, rather than any
information that may have been provided by Seller to Purchaser.
6. Closing Conditions. Purchaser's obligation to proceed to Closing
is conditioned upon Seller's performance of the following obligations and
satisfaction of the following conditions, in addition to all of its other
obligations and conditions contained in this Agreement, provided that
Purchaser may in its sole discretion elect to waive failure by Seller to
perform any particular obligation.
6.1 Title Insurance. The Title Insurer is prepared to issue a
policy of title insurance insuring Purchaser's interest in the Property being
conveyed, subject only to Acceptable Exceptions.
6.2 Estoppel Letters. Seller has delivered to Purchaser not later
than the date of Closing, estoppel letters substantially in the form of
Schedule 6.2 ("Required Estoppel Form") or in form otherwise reasonably
acceptable to Purchaser, prepared by Seller and
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addressed to Purchaser, from tenants occupying in the aggregate at least 75%
of the Property, measured by square footage. All estoppel letters must be
dated not more than forty-five (45) days prior to the date of Closing. An
estoppel letter form, even though not in the Required Estoppel Form, will be
deemed reasonably acceptable to Purchaser if said letter contains the
following information: confirming rent, security deposit, square footage and
termination date; that no rent has been paid more than one month in advance;
that the lease is in full force and effect and that a true and correct copy
of the lease with all amendments and modifications is attached; and that all
work to be performed by Landlord has been performed and that the tenant has
no knowledge of any Landlord default.
6.2.1 If Seller is unable to obtain the requisite estoppel
letters as described above, Seller may (but is not required to) substitute
for any unsigned estoppel letter from a tenant other than a Major Tenant an
estoppel letter in the Required Estoppel Form, which may be completed,
executed and delivered by Seller and warranted and represented by Seller,
provided that such substituted estoppel letters will not collectively
represent in excess of 10% of all of the tenants, measured by square footage.
Seller's representations and warranties in the certificates will survive the
Closing subject to the limitations of Paragraph 5.3. In the event that,
following the Closing Date, Seller or Purchaser obtains an estoppel letter
complying with the requirements of Paragraph 6.2 with respect to any lease
for which Seller delivered a substituted estoppel letter, Seller will deliver
such estoppel letter to Purchaser and, upon such delivery, Seller will be
automatically released from any liability or obligation under the substituted
estoppel letter previously delivered by Seller with respect to such lease.
Purchaser may (but shall not be required to) accept a substituted estoppel
letter as to a Major Tenant as well.
6.2.2 If Seller is unable to obtain and deliver sufficient
tenant estoppel certificates as required under Paragraph 6.2, or if the
letters received under Paragraph 6.2 or substituted estoppels permitted under
Paragraph 6.2.1 contain information or omissions unacceptable to Purchaser in
its reasonable discretion, then Seller will not be in default by reason
thereof, but Purchaser may, by notice given to Seller before the Closing,
elect (i) to waive said conditions and proceed with the Closing or (ii) to
terminate this Agreement, and receive a refund of the Deposit. If Purchaser
elects to terminate this Agreement, neither party will have any further
rights or obligations hereunder except as provided in Paragraph 9.15.
6.3 Representations and Warranties. All of Seller's
representations and warranties made pursuant to Paragraph 5.1 remain true and
correct in all material respects.
6.4 Seller Performance. Seller has delivered all of the documents
and other items required pursuant to Paragraph 8.6 and has performed all
other covenants, undertakings and obligations required by this Agreement, to
be performed or complied with by Seller at or prior to Closing.
7. Other Agreements. The obligations of Purchaser and Seller to close
hereunder shall also be conditioned upon the simultaneous closing of (a) the
purchase by Purchaser or an
9
affiliate of Purchaser, of twelve industrial and office buildings and a
parcel of vacant land in King of Prussia Business Park, King of Prussia,
Pennsylvania, pursuant to that certain Agreement of Purchase and Sale of even
date herewith ("KOP Agreement") between Purchaser, as purchaser, and RREEF
USA Fund-I ("KOP Owner"), as seller, and (b) the purchase by Purchaser or an
affiliate of Purchaser, of the industrial building commonly known as 180
Wheeler Court, Bucks County, Pennsylvania, pursuant to that certain Agreement
of Purchase and Sale of even date herewith (the "Wheeler Court Agreement";
the KOP Agreement and the Wheeler Court Agreement collectively the "Other
Agreements") between Purchaser, as purchaser, and RREEF MidAmerica East-V
Six, Inc. ("Wheeler Court Owner"; the KOP Owner and the Wheeler Court Owner
are collectively referred to as the "Other Owners"), as seller. This
condition may be waived by the parties. Without limiting the generality of
the foregoing, if Purchaser terminates this Agreement pursuant to Section 3
or Section 4, the Other Owners shall have the right to terminate the Other
Agreements as well; or, if Purchaser terminates one or more of the Other
Agreements pursuant to Section 3 or Section 4 of the Other Agreements, Seller
shall have the right to terminate this Agreement as well. A default by
Purchaser under one or more of the Other Agreements shall be deemed a
Purchaser default hereunder, and a default by an Other Owner under one or
more of the Other Agreements shall be deemed a Seller default hereunder.
8. Closing.
8.1 Closing of Sale. The purchase and sale contemplated herein
shall close (herein referred to as the "Closing") at the office of the Title
Insurer, or as otherwise mutually agreed, on a date selected by Seller, which
date (the "Closing Date") shall not be earlier than the date which is fifteen
(15) days after the expiration of the Review Period nor more than thirty (30)
days after expiration of the Review Period, time being of the essence. At
Closing, Seller will deliver to Purchaser a Special Warranty Deed ("Deed") in
the form of Schedule 8.6.1 and other closing documents required hereunder and
Purchaser will cause payment of the Purchase Price to be made to Seller by
wire transfer. The sale (payment of the Purchase Price and delivery of the
Deed) may, at Purchaser's option to be exercised by notice to Seller at least
five (5) days prior to the Closing Date, be closed through escrow with the
Title Insurer in accordance with the general provisions of the usual form of
escrow agreement used in similar transactions by such Title Insurer with
special provisions inserted (i) as may be required to conform with this
Agreement and (ii) to close on a so-called "New York Style" basis.
8.2 Prorations; Adjustments. The parties will prorate taxes,
rental, and other income, and operating or other expenses of the Property as
of 12:01 a.m. on the date after Closing (i.e., Seller is entitled to the
income and responsible for the expenses of the day of Closing). All income
will be prorated on the basis of income actually received by Seller, as
opposed to income which is due or for which Seller has rendered invoices but
which has not been paid (i.e., Seller will not be entitled to any credit for
receivables, and there will be no proration as to such receivables). Any
taxes or other expenses of the Property for any period prior to Closing which
are payable by tenants of the Property subsequent to Closing (e.g., real
estate taxes paid in arrears and not yet billed to tenants), will reduce the
credit to Purchaser for such items (i.e., no
10
credit from Seller for pass-through items for which Purchaser will later
collect from the tenants). To the extent that the taxes to be prorated are
not known with certainty, such proration will be based upon the most recent
tax bill or county estimate, to be re-prorated upon issuance of final bills.
Seller also agrees to give Purchaser a credit against the Purchase Price for
all cash security deposits required to be held pursuant to the Leases (less
portions thereof applied by Seller to tenant defaults and not subsequently
restored by the tenant in question) and all interest due thereon and shall
assign to Purchaser any other tenant deposits held by Seller. Purchaser will
pay amounts subsequently received by it from tenants constituting base rent,
capital reimbursements or other income due from tenants and attributable to
Seller's period of ownership, but not collected as of the date of Closing, to
Seller promptly upon receipt; provided that amounts received from tenants by
Purchaser will be first applied to current charges, and the balance will be
applied to payments due to Seller. Notwithstanding the foregoing, Seller
shall expressly reserve the right to seek to collect, directly from the
tenants after Closing and with Purchaser's cooperation, any delinquencies and
other amounts attributable to Seller's period of ownership, but not collected
as of the date of Closing. To the extent Seller has received amounts from
tenants for real estate taxes and 1997 and 1998 operating expenses in excess
of amounts paid by Seller with respect to such expenses, Seller will credit
such excess to Purchaser at Closing, and Seller will provide adequate backup
information in connection with such credit. On or after the Closing, Seller
will have no further obligations with respect to any Leases or other
agreements affecting the Property, including, without limitation, tenant
improvement work, leasing commissions and free rent.
8.2.1 Seller and Purchaser hereby agree to use their
reasonable efforts to calculate prorations (including real estate tax
prorations) so as to permit settlement thereof on the Closing Date, provided,
however, that if any of such prorations cannot be calculated accurately on
the Closing Date, then the same will be calculated as soon as reasonably
practicable after the Closing Date, but in no event later than the later to
occur of (i) thirty (30) days after Seller receives its final cost
certification for the year in which Closing occurs, or (ii) March 31 of the
year following the year in which Closing occurs, and either party owing the
other party a sum of money based on such subsequent proration(s) shall
promptly pay said sum to the other party, together with interest thereon at
the rate of two percent (2%) per annum over the "prime rate" (as announced
from time to time in the Wall Street Journal) from the Closing Date to the
date of payment if payment is not made within thirty (30) days after delivery
of a bill therefor together with reasonable back-up documentation. This
obligation of the parties will survive Closing.
8.3 Proration of Service Charges. To the extent Seller, as
opposed to tenants, is responsible for payment of utility charges, Seller
will attempt to have utility meters read as of the Closing Date. To the
extent that this is not possible and to the extent that any other obligation
for continuing services is incurred, and statements are rendered for such
services covering periods both before and after the Closing Date, the amount
will be adjusted between the parties as of the Closing Date on a per-diem
basis. Seller will forward any such statements which it receives to
Purchaser and Purchaser will pay the same. Seller will remit to Purchaser its
proportionate share immediately upon demand.
11
8.4 Closing Costs. Purchaser agrees to pay (i) the Title
Insurer's escrow and/or closing fees (including any payment to the closing
officer of the Title Insurer as may be the local custom at the Closing), (ii)
the cost of the title commitment and basic policy and endorsements, if any,
required to meet Seller's obligations hereunder and the cost of any
endorsements to the title policy required by Purchaser, including extended
coverage, (iii) all recording fees and taxes with respect to the Deed, (iv)
all costs of Purchaser's physical inspections of the Property (environmental,
engineering) and other due diligence activities; (v) all costs of survey,
including fees and charges of Gannett Fleming Associates (originally engaged
by Seller); (vi) cancellation charges, if applicable, to Coventry Abstract
(originally engaged by Seller); and (vii) one-half (1/2) of applicable
transfer taxes. Seller agrees to pay (i) all recording fees with respect to
clearing Seller's title, and (ii) one-half (1/2) of applicable transfer
taxes. Except as otherwise provided in Paragraph 9.9, each party is
responsible for its own attorneys' and other professional fees. All other
closing costs shall be allocated in accordance with the prevailing local
custom.
8.5 Possession. Subject to the rights of tenants pursuant to
Leases delivered to Purchaser, Seller will deliver possession of the Property
and of any conveyed personal property to the Purchaser on the date of Closing
and Seller will thereupon deliver to Purchaser the originals of all Leases,
all correspondence with tenants, tenant/lease files, operating statements,
plans and specifications, supplies and advertising materials, booklets, keys,
and other items used in connection with operation of the Property.
8.6 Seller's Closing Documents. As part of the Closing, Seller
will deliver to Purchaser:
8.6.1 the Deed, in the form of Schedule 8.6.1
8.6.2 an affidavit in customary form that Seller is not a
foreign person within the meaning of Section 1445(e) of the Internal Revenue
Code of 1986, in the form of Schedule 8.6.2;
8.6.3 such affidavits as are customarily required by Title
Insurer in connection with issuance of the owner's basic title insurance
policy, including a mechanics' lien and judgment affidavit;
8.6.4 an assignment of the Leases in the form of Schedule
8.6.4 ("Lease Assignment");
8.6.5 an assignment of contracts and warranties in the
form of Schedule 8.6.5 ("Contracts Assignment"), assigning to Purchaser all
contracts listed on Schedule 5.1.5, other than those designated by Purchaser
for termination by notice to Seller not less than thirty (30) days prior to
Closing;
12
8.6.6 an assignment of intangibles in the form of Schedule
8.6.6 ("Intangibles Assignment");
8.6.7 letters, in form to be supplied by Purchaser, to the
tenants at the Property, instructing the tenants to pay rent to Purchaser
and to recognize Purchaser as landlord under their Leases;
8.6.8 a bill of sale conveying all personal property of
Seller, if any, located at the Property and used in connection with the
maintenance or operation thereof (specifically excluding furniture, fixtures
and equipment owned by RREEF Management Company and located in the RREEF
Management Company office), in the form of Schedule 8.6.8;
8.6.9 a rent roll, certified by Seller as being true and
correct, to Seller's knowledge, as of the Closing Date, in the form
previously delivered to Purchaser;
8.6.10 a "bring down certificate" stating that Seller's
representations and warranties are true and correct as of the Closing Date,
in the form of Schedule 8.6.10;
8.6.11 estoppel certificates as required by Paragraph 6.2
herein; and
8.6.12 all other documents, instruments or writings which
may be reasonably required to consummate the transactions contemplated herein.
8.7 Purchaser's Closing Documents. As part of the Closing,
Purchaser will deliver to Seller:
8.7.1 good federal funds in an amount equal to the
Purchase Price, less the Deposit and interest thereon and plus or minus
prorations as provided herein and plus funds sufficient to pay Purchaser's
closing costs hereunder;
8.7.2 such affidavits as are customarily required by Title
Insurer in connection with issuance of the owner's title insurance policy;
8.7.3 executed counterpart of the Lease Assignment;
8.7.4 executed counterpart of the Contracts Assignment;
8.7.5 executed counterpart of the Intangibles Assignment;
8.7.6 all other documents, instruments or writings which
may be reasonably required to consummate the transactions contemplated herein.
13
8.8 Joint Deliveries. At the Closing, Seller and Purchaser will
execute and deliver to each other the following documents in proper form:
8.8.1 Closing Statement;
8.8.2 City, county and state transfer tax declarations or
similar instruments; and
8.8.3 All other documents, instruments or writings which
may be reasonably required to consummate the transactions contemplated herein.
9. Miscellaneous.
9.1 Modifications. This Agreement can be amended only in writing
signed by both of the parties.
9.2 Casualty and Condemnation. Seller agrees to keep its
customary replacement cost insurance covering the Property in effect until
the Closing. If between the Effective Date and the Closing the improvements
on the Property are destroyed or damaged to the extent that repairs cost in
excess of $250,000 in the estimate of an architect or contractor selected by
Seller and reasonably acceptable to Purchaser, or if condemnation proceedings
are commenced against the Property, Purchaser may (i) terminate this
Agreement or (ii) elect to accept the Property in its then condition, in
which event Seller will pay or assign to Purchase at Closing all proceeds of
insurance (plus the applicable deductible) or condemnation awards payable to
Seller by reason of such damage or condemnation. In the event Purchaser
makes neither election by the earlier of (a) Closing or (b) ten (10) days
after being advised of such casualty or condemnation, Purchaser will be
deemed to have elected to accept the Property in its then condition. In the
event of any other damage to the Property, Seller may either repair the
damage or give Purchaser a reduction in the Purchase Price equal to the cost
of repairing such damage, as certified by an architect or contractor selected
by Seller and reasonably acceptable to Purchaser. In the event of any damage
where Purchaser does not have the right to terminate and Seller elects to
repair such damage, the Closing Date shall be delayed for the number of days
required to repair the damage, which Seller agrees to do in accordance with
all Laws and in a good and workmanlike manner.
9.3 Time of Essence. Time (including, without limitation, the
date specified as the Closing Date) is of the essence of this Agreement.
9.4 Notices. All notices required or permitted hereunder must be
in writing and shall be served on the parties at the following address:
If to Purchaser: Brandywine Realty Trust
14
Newtown Square Corporate Campus
16 Campus Blvd.
Suite 150
Newtown Square, PA 19073
Attn: Gerard H. Sweeney, President & CEO
Brad A. Molotsky, General Counsel
Facsimile: (610-325-5622)
If to Seller: RREEF MidAmerica/East Fund-IV
c/o The RREEF Funds
875 N. Michigan Avenue
Suite 4100
Chicago, IL 60611
Attn: Mr. John Turney & Ms. Pamela Boneham
Facsimile: (312) 266-9346
with a copy to: RREEF MidAmerica/East Fund-IV
c/o The RREEF Funds
650 Park Avenue
Suite 210
King of Prussia, PA 19406
Attn: Ms. Barbara Gillentine
Facsimile: (610) 337-2308
and a copy to: D'Ancona & Pflaum
30 North LaSalle Street
Suite 2900
Chicago, Illinois 60602
Attn: Lawrence J. Moss
Facsimile: (312) 580-0923
Any such notices may be sent by (a) certified mail, return receipt requested, in
which case notice will be deemed delivered three (3) business days after
deposit, postage prepaid in the U.S. mail or (b) a nationally recognized
overnight courier, in which case notice will be deemed delivered one business
day after deposit with such courier or (c) facsimile transmission, in which case
notice will be deemed delivered upon electronic verification that transmission
to recipient was completed, provided that notices sent by facsimile transmission
on a day other than a business day, or before 9:00 a.m. or after 5:00 p.m.
recipient's time on a business day, shall be deemed given on the first business
day following the date of transmission or (d) personal delivery. The above
addresses and facsimile numbers may be changed by notice to the other party;
provided that no notice of a change of address or facsimile number will be
effective until actual receipt of such notice.
15
9.5 Parties Bound. Neither party may assign this Agreement
without the prior written consent of the other, and any such prohibited
assignment shall be void; provided that Purchaser may assign this Agreement
without Seller's consent to an Affiliate; provided that the assignee is not a
party-in-interest as described in Paragraph 9.14. Subject to the foregoing,
this Agreement is binding upon and inure to the benefit of the respective
legal representatives, successors, assigns, heirs, and devisees of the
parties. For the purposes of this Paragraph, the term "Affiliate" means (a)
an entity that directly or indirectly controls, is controlled by or is under
common control with the Purchaser or (b) an entity at least a majority of
whose economic interest is owned by Purchaser; and the term "control" means
the power to direct the management of such entity through voting rights,
ownership or contractual obligations.
9.6 Governing Law. The performance and interpretation of this
Agreement is controlled by the law of the Commonwealth of Pennsylvania.
9.7 Continuation Until Closing; Leasing.
9.7.1 Between the Effective Date and the Closing, Seller
agrees to keep and perform all of the obligations to be performed by landlord
under any Leases and Laws. Seller agrees to operate the Property in the same
manner as before the making of this Agreement, the same as though Seller were
retaining the Property. Seller agrees not to convey the Property, nor to
grant any liens or easements with respect thereto.
9.7.2 Seller shall not permit or consent to any new
leases, amendments, extensions, renewals (other than pursuant to tenant
renewal options, if any) or subleases without first submitting them to
Purchaser for Purchaser's approval on an approval form in the form attached
hereto as Schedule 9.7.2, which approval shall not be unreasonably withheld.
Purchaser shall have three (3) business days to notify Seller of its approval
of such leases, amendments, extensions, renewals or subleases, and in the
event that Purchaser does not so notify Seller, the leases, amendments,
extensions, renewals or subleases, as the case may be, shall be deemed
approved.
9.7.3 With respect to any new lease or lease modification
entered into by Seller after December 18, 1997 and approved by Purchaser, by
the terms of which Seller obligates itself to perform or performs or pays or
contracts for any tenant improvement work or additional landlord work
required pursuant to such lease, or pays or contracts for any leasing
commissions or grants any free rent period or other financial concessions,
then such expenses and/or free rent or other concessions, and all other
third-party costs incurred (including attorneys' fees) in connection with
such lease, will be a credit to Seller at Closing to the extent Seller paid
such amounts prior to Closing; otherwise Purchaser agrees to assume liability
for the payment and performance of such obligations in accordance with the
terms thereof.
9.8 Brokers. Seller and Purchaser each (i) represents and
warrants to the other that it has not dealt with any broker or finder in
connection with the transaction contemplated by
16
this Agreement other than the parties, if any, to be paid a commission as
specified in Paragraph 9.11, and (ii) agrees to defend, indemnify and hold
the other harmless from and against any losses, damages, costs, or expenses
(including attorneys' fees) incurred by such other party due to a breach of
the foregoing warranty by the indemnifying party.
9.9 Attorneys' Fees. Notwithstanding any limitation on remedies
or amounts recoverable set forth elsewhere herein, if any action is brought
by either party against the other party, the party in whose favor final
judgment is entered will be entitled to recover court costs incurred and
reasonable attorneys' fees at trial, upon appeal and on any petition for
review.
9.10 Remedies for Non-Performance. Purchaser's remedies regarding
breach of warranty or representation by Seller are governed by Paragraph 5.3.
In the event of any other default by Seller hereunder, Purchaser may, as its
sole and exclusive remedy, either (i) terminate this Agreement and seek
damages, subject to performance of Purchaser's indemnities set forth in
Paragraph 9.15, and receive back the Deposit or (ii) seek specific
performance. If said sale is not consummated because of a default under this
Agreement on the part of Purchaser, the Deposit will be paid to and retained
by Seller as Seller's sole and exclusive remedy. Seller and Purchaser
acknowledge that the Deposit is a reasonable forecast of just compensation
for the harm that could be caused by Purchaser's default and that the harm
suffered by Seller is difficult or impossible to accurately ascertain or
predict. NOTWITHSTANDING ANY OTHER PROVISION OF THIS AGREEMENT TO THE
CONTRARY, SELLER'S TOTAL LIABILITY FOR DAMAGES FOR BREACH OF THE COVENANTS,
AGREEMENTS, WARRANTIES AND REPRESENTATIONS UNDER THIS AGREEMENT AND THE OTHER
AGREEMENTS, COLLECTIVELY, SHALL NEVER EXCEED TWO MILLION DOLLARS
($2,000,000.00), AND IN NO EVENT SHALL SELLER BE LIABLE FOR SPECIAL,
EXEMPLARY, CONSEQUENTIAL OR PUNITIVE DAMAGES.
9.11 Brokers Commission. Seller agrees to pay the brokerage
commission due The Flynn Company pursuant to a separate agreement.
9.12 Survival of Covenants. All covenants hereunder which, by
their terms, are intended to survive Closing will survive Closing hereunder.
9.13 Seller's Investment Committee Approval. This condition has
been satisfied.
9.14 ERISA. Purchaser represents and warrants to Seller that none
of Purchaser's assets are "plan assets," (as that term is defined by 29 CFR
Section 2510.3-101) because all plans that are subject to the provisions of
the Employee Retirement Income Security Act of 1974, as amended, and which
have invested in Purchaser hold only "equity interests," (as that term is
defined by 29 CFR Section 2510.3-101(b)(1)) that are "publicly-offered
securities," (as that term is defined by 29 CFR Section 2510.3-101(b)(2)).
Purchaser further represents and warrants to Seller that
17
it is not any one of the types of entities listed in 29 CFR Section
2510.3-101(h), the character of which would identify its assets as "plan
assets."
9.15 Entry and Indemnity. In connection with any entry by
Purchaser, or its agents, employees or contractors onto the Property,
Purchaser shall give Seller reasonable advance notice of such entry and shall
conduct such entry and any inspections in connection therewith so as to
minimize, to the greatest extent possible, interference with Seller's
business and the business of Seller's tenants and otherwise in a manner
reasonably acceptable to Seller. Without limiting the foregoing, prior to any
entry to perform any on-site testing, Purchaser shall give Seller notice
thereof, including the identity of the company or persons who will perform
such testing and the proposed scope of the testing. Seller shall approve or
disapprove the scope and methodology of such proposed testing within three
(3) business days after receipt of such notice, such approval to be within
the sole and unfettered discretion of Seller; Seller's failure to notify
Purchaser of its approval or disapproval shall be deemed to be Seller's
disapproval thereof. If Purchaser or its agents, employees or contractors
take any sample from the Property in connection with any such approved
testing, upon Seller's request, Purchaser shall provide to Seller a portion
of such sample being tested to allow Seller, if it so chooses, to perform its
own testing. Seller or its representative may be present to observe any
testing or other inspection performed on the Property. Upon Seller's
request, Purchaser shall promptly deliver to Seller copies of any reports
relating to any testing or other inspection of the Property performed by
Purchaser or its agents, employees or contractors. Purchaser shall maintain,
and shall assure that its contractors maintain, public liability and property
damage insurance in amounts and in form and substance adequate to insure
against all liability of Purchaser, its agents, employees or contractors,
arising out of any entry or inspections of the Property pursuant to the
provisions hereof, and Purchaser shall provide Seller with evidence of such
insurance coverage upon request by Seller. Purchaser shall indemnify, defend
and hold Seller harmless from and against any costs, damages, liabilities,
losses, expenses, liens or claims (including, without limitation, reasonable
attorney's fees) arising out of or relating to any entry on the Property by
Purchaser, its agents, employees or contractors in the course of performing
the inspections, testings or inquiries provided for in this Agreement,
including without limitation damage to the Property or release of hazardous
substances or materials onto the Property, excluding, however, any costs
incurred by Seller in supervising Purchaser's testing. The foregoing
indemnity shall survive beyond the Closing, or if the sale is not
consummated, beyond the termination of this Agreement.
9.16 Release. Except to the extent of the representations and
warranties of Seller expressly set forth in this Agreement, and except to the
extent of a breach by Seller of applicable laws, but otherwise
notwithstanding any other provision of this Agreement to the contrary,
Purchaser, on behalf of itself and its successors and assigns, waives its
right to recover from, and forever releases and discharges, Seller, Seller's
affiliates, Seller's investment manager, the partners, trustees,
shareholders, directors, officers, employees and agents of each of them, and
their respective heirs, successors, personal representatives and assigns
(collectively, the "Seller Related Parties"), from any and all demands,
claims, legal or administrative proceedings, losses, liabilities, damages,
penalties, fines, liens, judgments, costs or expenses whatsoever (including,
18
without limitation, attorneys' fees and costs), whether direct or indirect,
known or unknown, foreseen or unforeseen, which may arise on account of or in
any way be connected with the physical condition of the Property or any law
or regulation applicable thereto, including, without limitation, the
Comprehensive Environmental Response, Compensation and Liability Act of 1980,
as amended (42 U.S.C. Sections 9601 et seq.), the Resources Conservation and
Recovery Act of 1976 (42 U.S.C. Section 6901 et seq.), the Clean Water Act
(33 U.S.C. Section 466 et seq.), the Safe Drinking Water Act (14 U.S.C.
Sections 1401-1450), the Hazardous Materials Transportation Act (49 U.S.C.
Section 1801 et seq.), and the Toxic Substance Control Act (15 U.S.C.
Sections 2601-2629)
9.17 Confidential Information. The parties acknowledge that the
transaction described herein is of a confidential nature and shall not be
disclosed except to consultants, investors, advisors, and affiliates, or as
required by law. No party will make any public disclosure of the specific
terms of this Agreement, except as required by law. Without limiting the
generality of the foregoing, any press release or other public disclosure
regarding this Agreement or the transactions contemplated herein, and the
wording of same, must be approved in advance by both parties. In connection
with the negotiation of this Agreement and the preparation for the
consummation of the transactions contemplated hereby, each party acknowledges
that it will have access to confidential information relating to the other
party. Each party shall treat such information as confidential, preserve the
confidentiality thereof, and not duplicate or use such information, except to
advisors, consultants, investors and affiliates in connection with the
transactions contemplated hereby. In the event of the termination of this
Agreement for any reason whatsoever, Purchaser will return to Seller, at
Seller's request, all documents, work papers, and other material (including
all copies thereof) obtained from Seller in connection with the transactions
contemplated hereby, and each party shall use its best efforts, including
instructing its employees and others who have had access to such information,
to keep confidential and not to use any such information. The provisions of
this Paragraph 9.17 will survive the Closing or, if the purchase and sale is
not consummated, any termination of this Agreement.
9.18 Calculation of Time Periods. Unless otherwise specified, in
computing any period of time described herein, the day of the act or event,
after which the designated period of time begins to run, is not to be
included and the last day of the period so computed is to be included, unless
such last day is a Saturday, Sunday or legal holiday, in which event the
period shall run until the end of the next day which is neither a Saturday,
Sunday, or legal holiday (i.e., a day on which federally chartered banks are
not open for business in Chicago, Illinois). The last day of any period of
time described herein shall be deemed to end at 5 p.m. Chicago, Illinois time
on the last day of such period of time. All days other than Saturdays,
Sundays and legal holidays in which national banks are closed in Chicago,
Illinois are business days hereunder.
9.19 Entire Agreement. This Agreement and any other document to be
furnished pursuant to the provisions hereof embody the entire agreement and
understanding of the parties hereto as to the subject matter contained
herein. There are no restrictions, promises,
19
representations, warranties, covenants, or undertakings other than those
expressly set forth or referred to in such documents. This Agreement and
such documents supersede all prior agreements and understandings among the
parties with respect to the subject matter hereof
9.20 Severability. Any term or provision of this Agreement that is
invalid or unenforceable in any jurisdiction will, as to such jurisdiction,
be ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement, or affecting the validity or enforceability of any of the terms or
provisions of this Agreement.
9.21 Facsimile Signatures. Executed facsimile copies of this
Agreement or any amendments hereto shall be binding upon the parties, and
facsimile signatures appearing hereon or on any amendments hereto shall be
deemed to be original signatures.
9.22 Further Assurances. In addition to the acts and deeds recited
herein and contemplated to be performed, executed and/or delivered by Seller
to Purchaser at Closing, Seller agrees to perform, execute and deliver, but
without any obligation to incur any additional liability or expense, on or
after the Closing any further deliveries and assurances as may be reasonably
necessary to consummate the transactions contemplated hereby or to further
perfect the conveyance, transfer and assignment of the Property to Purchaser.
9.23 Offer. Execution and delivery of this Agreement by Purchaser
constitutes an offer to purchase the Property on the terms contained herein.
Delivery by Seller of a copy of the fully executed Agreement by facsimile
transmission on or before the Expiration Date, followed by a manually signed
copy thereof delivered the next business day after transmission of such copy,
shall constitute acceptance by Seller as of the date of the facsimile
transmission. The date on which Seller delivers a fully executed copy of this
Agreement to Purchaser, or delivers a copy by facsimile transmission followed
by a manually signed copy as provided in the preceding sentence is referred
to herein as the "Effective Date."
9.24 Seller Exculpation Clause. The obligations of Seller
contained herein are intended to be binding only on the property of the trust
party to this Agreement of Purchase and Sale and shall not be personally
binding upon, nor shall any resort be had to the private properties of, any
of the trustees, investment managers, any general partners thereof, or any
employees or agents of the trustees or investment managers. All documents to
be executed by Seller shall also contain the foregoing exculpation.
20
9.25 Purchaser Exculpation Clause. No recourse shall be had for
any obligation of Brandywine Operating Partnership, L.P. and Brandywine
Realty Trust under this Agreement or under any document executed in
connection herewith or pursuant hereto, or for any claim based thereon or
otherwise in respect thereof, against any past, present or future trustee,
shareholder, officer or employee of Brandywine Operating Partnership, L.P. or
Brandywine Realty Trust, whether by virtue of any statute or rule of law, or
by the enforcement of any assessment or penalty or otherwise, all such
liability being expressly waived and released by the Seller and all parties
claiming by, through or under Seller.
9.26 SEC Reporting (8-K) Requirements. For the period of time
commencing on the date hereof and continuing through the first anniversary of
the Closing Date, and without limitation of other document production
otherwise required of Seller hereunder, Seller shall, from time to time, upon
reasonable advance written notice from Purchaser, provide Purchaser and its
representatives, with (a) access to all financial information pertaining to
the period of Seller's ownership and operation of the Property, which
information is relevant and reasonably necessary, in the opinion of
Purchaser's outside, third party accountants (the "Accountants"), to enable
Purchaser and its Accountants to prepare financial statements in compliance
with any or all of (i) Rule 3-05 or 3-15 of Regulation S-X of the Securities
and Exchange Commission (the "Commission"), as applicable; (ii) any other
rule issued by the Commission and applicable to Purchaser; and (iii) any
registration statement, report or disclosure statement filed with the
Commission, by, or on behalf of Purchaser; and (b) a representation letter,
signed by the
21
individual(s) responsible for Seller's financial reporting, substantially in
the form of Schedule 9.26 attached hereto, which representation letter may be
required by the Accountants in order to render an opinion concerning Seller's
financial statements.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the dates set forth below.
SELLER: PURCHASER:
RREEF MIDAMERICA/EAST FUND-IV BRANDYWINE OPERATING
PARTNERSHIP, L.P.
By: RREEF America L.L.C., its By: Brandywine Realty Trust,
investment advisor its authorized general
partner
By:________________________________ By:____________________________
Authorized Representative Gerard H. Sweeney
President and Chief
Dated: ____________________________ Executive Officer
Dated:_________________________
22
List of Schedules and Exhibits
Schedules
2.1 Escrow Instructions
5.1 Disclosure Schedule
5.1.5 Service Contracts
5.1.10 Rent Roll
5.1.12 Future Leasing Commissions, Tenant Improvements and
Free Rent
6.2 Form of Estoppel Letter
8.6.1 Form of Deed
8.6.2 FIRPTA Certificate
8.6.4 Assignment and Assumption of Leases
8.6.5 Assignment and Assumption of Contracts and Warranties
8.6.6 Assignment of Intangibles
8.6.8 Bill of Sale
8.6.10 Bring-Down Certificate
9.26 SEC Compliance Representation Letter
Exhibits
A Legal Description of Property
A-1 Descriptive List of the Property
23
Schedule 2.1
EARNEST MONEY ESCROW INSTRUCTIONS
(earnest money escrow instructions previously executed)
Schedule 5.1
DISCLOSURE SCHEDULE
A 1996 Environmental Audits was prepared by ATC Environmental, Inc.
for the Property. This Audit has been made available to Purchaser for
inspection and copying, and, each of the Seller warranties of Section 5.1.8
and its subparagraphs are qualified and limited by any matters disclosed in
such Audit.
Schedule 5.1.5
Service Contracts
A.T. BUILDERS
BFI
BERWYN GLASS
BOYLE ELECTRICAL CONTRACTORS
BURHANS GLASS COMPANY, INC.
CONTROLLED ENVIRONMENTS
CROWN CONTRACTORS, INC.
JOSEPH W. DAVIS, INC.
DIROCCO BROTHERS COMPANY
DURASEAL, INC.
ELDREDGE
FIDELITY ALARM COMPANY
GALLAGHER EXCAVATING, INC. (GEI)
GUARDIAN ALARM SYSTEMS
HONEYWELL
MOON LANDSCAPING
OLIVER SPRINKLER
PENNTEX CONSTRUCTION COMPANY
PHOENIX MECHANICAL, INC.
RHETT HAMILTON JONES ASSOCIATES
SANTANGELO HAULING CO.
SECURITY ELEVATOR COMPANY
SYSTEMATIC ROOFING ANALYSIS
TELEPHONE DIAGNOSTIC SERVICES, INC.
TERMINIX INTERNATIONAL CO.
VECTORDYNE
DAVID WHITE PLUMBING
Schedule 5.1.10
Rent Roll
Schedule 5.1.12
Future Leasing Commissions, Tenant Improvements and Free Rent
1. If Tozour Trane, the tenant of 741 First Avenue, does not exercise certain
termination options, commissions may become due to The Flynn Company in the
amounts of $20,260.50 and $16,109.00 on May 1, 2000 and May 1, 2003,
respectively.
Schedule 6.2
TENANT ESTOPPEL LETTER
__________ __, 1998
Brandywine Realty Trust
Newtown Square Corporate Campus
16 Campus Boulevard
Newtown Square, PA 19073
Attention: Gerard H. Sweeney,
President and Chief Executive Officer
NationsBank, N.A.,
Real Estate Banking
8300 Greensboro Drive, Suite 300
McLean, VA 22102
Attention: Gary P.F. Carr
Re: Lease from ________, for Suite ____, located
at [BUILDING ADDRESS]
[CITY/TOWNSHIP], Pennsylvania (the
"Property")
To Whom it May Concern:
The undersigned is the holder of the tenant's interest under the lease
described on Exhibit A attached hereto (the "Lease") demising a portion of
the Property (the "Leased Premises"). We understand that Brandywine Realty
Trust, its assignee or nominee ("Brandywine") intends to acquire the
Property, and that NationsBank, N.A., as Agent for the parties listed on
Schedule 1 attached hereto ("Lender") may be the holder of a first mortgage
on the Property, and that Brandywine and Lender require this certification
from us.
Accordingly, we hereby certify to Brandywine and Lender as follows:
1. The Lease is in full force and effect and has not been modified,
amended or supplemented in any way, except as follows (Insert dates of all
modifications, amendments, or supplements; if none, write "None"):____________
______________________________________________________________________________.
2. There are no other representations, warranties, agreements,
concessions, commitments, or other understandings between the undersigned and
the Landlord regarding the Property other than as set forth in the Lease or
paragraph 1 above.
3. The landlord under the Lease has completed and delivered, and the
undersigned has accepted, the Leased Premises in the condition required by the
Lease and the term of the Lease commenced on _________. The Leased Premises
consists of approximately ___________ square feet. The undersigned has taken
possession of and is occupying the Leased Premises on a rent-paying basis and
the monthly base rent payable thereunder is $_________, payable in advance. All
improvements and work required under the Lease to be made by the landlord
thereunder and all facilities required under the Lease to be furnished to the
Leased Premises have been completed to the satisfaction of the undersigned,
except as follows (Insert description of any improvements and work to be
completed by the landlord under the Lease; if none, write "None"):
_____________________________.
4. The fixed expiration date set forth in the Lease, excluding renewals
and extensions, is ________________. The undersigned neither has any option or
right to purchase the Property or any portion thereof nor does the undersigned
have any right or option to terminate the Lease or any of its obligations
thereunder in advance of the scheduled termination date of the Lease as noted
above, except as follows (Insert description of any purchase rights or options,
and/or any early termination rights; if none, write "None"):
_______________________________.
5. All rents, additional rents and other sums due and payable under the
Lease have been paid in full and no rents, additional rents or other sums
payable under the Lease have been paid for more than one (1) month in advance
of the due dates thereof.
6. The landlord under the Lease is not in default under any of the
requirements, provisions, terms, conditions or covenants of the Lease to be
performed or complied with by the landlord under the Lease, and no event has
occurred or situation exists which would, with the passage of time and/or the
giving of notice, constitute a default or an event of default by the landlord
under the Lease.
7. The undersigned is not in default under any of the requirements,
provisions, terms, conditions, or covenants of the Lease to be performed or
complied with by the undersigned, and no event has occurred or situation
exists which would, with the passage of time and/or the giving of notice,
constitute a default or an event of default by the undersigned under the
Lease.
2
8. The undersigned has received no notice from any governmental
authority or other person or party claiming a violation of, or requiring
compliance with, any Federal, State or local statute, ordinance, rule,
regulation or other requirement of law, for environmental contamination at
the Leased Premises, to the best knowledge of the undersigned no hazardous,
toxic or polluting substances or wastes have been generated, treated,
manufactured, stored, refined, used, handled, transported, released, spilled,
disposed of or deposited by Tenant on, in or under the Leased Premises.
9. Neither the undersigned nor the landlord under the Lease has commenced
any action or given or received any notice for the purpose of terminating the
Lease.
10. There are no existing defenses, offsets, claims, or credits against
the payment of rent or the performance of the undersigned's obligations under
the Lease.
11. The undersigned has paid to the landlord under the Lease a security
deposit of $____________.
Very truly yours,
By:
---------------------------------
Name:
Title:
3
Exhibit A
(Description of Lease)
4
Schedule 8.6.1
Form of Deed
SPECIAL WARRANTY DEED:
THIS INDENTURE made this ____ day of ____________, 1998,
BETWEEN RREEF MIDAMERICA/EAST FUND-IV, A CALIFORNIA GROUP TRUST
(hereinafter called the Grantor/s), of the one part and
_____________________
(hereinafter called the Grantee/s), of the second part,
WITNESSETH That in consideration of Ten and No/100 Dollars ($10.00) in hand
paid, the receipt whereof is hereby acknowledged, the said Grantor/s do/does
hereby grant, bargain, sell and convey unto the said Grantee/s, his/her/their
successors and /or assigns,
ALL THAT CERTAIN real estate, situated in the County of Montgomery and
Commonwealth of Pennsylvania known and described on the attached Exhibit A
"Legal Description," attached hereto an hereby made a part hereof.
TOGETHER with all and singular the buildings, improvements, ways, streets,
alleys, driveways, passages, waters, water-courses, rights, liberties,
privileges, hereditaments and appurtenances whatsoever unto the hereby granted
premises belonging, or in anywise appertaining, and the reversions and
remainders, rents, issues and profits thereof; and all the estate, right, title,
interest, use, trust, property, possession, claim and demand whatsoever of
Grantor as well at law as in equity, of, in, and to the same.
TO HAVE AND TO HOLD the said lot or piece of ground described with the buildings
and improvements thereon erected, hereditaments and premises hereby granted, or
mentioned and intended so to be, with the appurtenances unto the said Grantee,
and its successors and assigns to and for the only proper use and behoof of the
said Grantee, and its successors and assigns, forever.
AND the said Grantor/s do/does hereby covenant to and with the said Grantee/s
that he/she/they, the said Grantor/s, his/her/their successors and/or assigns,
SHALL AND WILL warrant specially and forever defend the herein above described
premises, with the hereditaments and appurtenances, unto the said Grantor/s and
against every other person lawfully claiming or who shall hereafter claim the
same or any part thereof, by, from and under his/her/their successors and/or
assigns or any of them, subject to validly and legally existing encumbrances of
record.
IN WITNESS WHEREOF, the said Grantor/s has/have caused these presents to be duly
executed, the day and year first above written.
ATTEST: RREEF MIDAMERICA/EAST FUND-IV,
a California group trust
By:___________________________ By: RREEF America L.L.C., a
Delaware limited liability company,
its investment advisor
By:_______________________
Authorized Representative
[Add Pennsylvania address certification]
2
STATE OF _____________________)
) SS.
COUNTY OF ____________________)
I,_______________________________________________, a notary public in and
for said County, in the State aforesaid, DO HEREBY CERTIFY that ______________
__________________ and ___________________________, personally known to me to be
the ______________________ and ______________ of RREEF MIDAMERICA/EAST FUND-IV,
a California group trust, and personally known to me to be the same persons
whose names are subscribed to the foregoing instrument, appeared before me this
day in person and acknowledged that as such __________________________ and
_________________, they signed and delivered the said instrument as their free
and voluntary act, and as the free and voluntary act and deed of said trust,
for the uses and purposes therein set forth.
GIVEN under my hand and official seal this ____ day of _________________,
1998.
----------------------------------
Notary Public
Commission expires
------------------------------------------------------------
3
EXHIBIT A
Legal Description
Schedule 8.6.2
FIRPTA CERTIFICATE
Section 1445 of the Internal Revenue Code provides that a transferee of a
U.S. real property interest must withhold tax if the transferor is a foreign
person. To inform the transferee that withholding of tax is not required upon
the disposition of a U.S. real property interest by __________________________
__________________________________________, a _______________________ ("Seller")
hereby certifies the following:
1. Seller is not a foreign corporation, foreign partnership, foreign trust or
foreign estate (as those terms are defined in the Internal Revenue Code and
Income Tax Regulations);
2. Seller's U.S. employer identification number is 94-6566801; and
3. Seller's principal place of business is 101 California Street, 26th
floor, San Francisco, CA 94111-5853
Seller understands that this certification may be disclosed to the
Internal Revenue Service by transferee and that any false statement contained
herein could be punished by fine, imprisonment, or both.
Under penalties of perjury I declare that I have examined this
certification and to the best of my knowledge and belief it is true, correct
and complete, and I further declare that I have authority to sign this
document on behalf of Seller.
________________________________________
________________________________________
By: ____________________________________
Authorized Representative
Subscribed and sworn to
before me this ____ day of
______, 1998.
______________________________
Notary Public
Schedule 8.6.4
ASSIGNMENT AND ASSUMPTION OF LEASES
THIS ASSIGNMENT AND ASSUMPTION OF LEASES (the "Assignment") dated
as the dates of execution set forth below, but effective as of the Conveyance
Date (as herein defined), is between _________________________________________,
a Delaware corporation, ("Assignor") and ________________, a _______________
("Assignee").
A. Assignor is the lessor under certain leases executed with respect
to that certain real property and improvements thereon known as
____________________, _______________________, and more particularly
described in Exhibit "A" attached hereto (the "Property"), which leases are
described in Exhibit B attached hereto (the "Leases").
B. Assignor and Assignee have entered into an Agreement of Purchase
and Sale with an Effective Date of ______________, 1998 (the "Agreement"),
pursuant to which Assignee agreed to purchase the Property from Assignor and
Assignor agreed to sell the Property to Assignee, on the terms and conditions
contained therein.
C. Assignor desires to assign its interest as lessor in the Leases to
Assignee, and Assignee desires to accept the assignment thereof, on the terms
and conditions below.
ACCORDINGLY, the parties hereby agree as follows:
1. As of the date on which the Property is conveyed to Assignee pursuant
to the Agreement (the "Conveyance Date") [SHOULD BE THE DAY FOLLOWING CLOSING],
Assignor hereby assigns to Assignee all of its right, title, and interest in and
to the Leases except rents and other sums due Assignor first accruing on or
prior to the Conveyance Date, and, effective as of the day following the
Conveyance Date, Assignee hereby accepts such assignment.
2. Assignor hereby assumes full responsibility for all obligations and
defaults of landlord under the Leases accruing prior to and including the
Conveyance Date. Assignor also agrees to defend, indemnify and hold Assignee
harmless from any claims, liabilities or costs (including reasonable attorneys'
fees) arising from Assignor's failure to perform said obligations, provided that
Assignee makes a claim hereunder on or before one (1) year following the
Conveyance Date.
3. Assignee hereby assumes full responsibility for all obligations of
landlord under the Leases accruing after the Conveyance Date and Assignee hereby
agrees to defend, indemnify and hold Assignor harmless from any claims,
liabilities or costs (including reasonable attorneys' fees) arising from
Assignee's failure to perform said obligations. Without limiting the generality
of the foregoing, Assignee assumes full responsibility for the free rent, unpaid
tenant improvement allowances and leasing commissions under the Leases as listed
on Exhibit C.
4. This Assignment shall be governed by the laws of the Commonwealth of
Pennsylvania.
5. This Assignment may be executed in counterparts.
6. The obligations of Assignor contained herein are intended to be
binding only on the property of the Assignor and shall not be personally binding
upon, nor shall any resort be had to the private properties of, any of the
investment managers of Assignor, or any general partners thereof, or any
employees or agents of the investment managers.
IN WITNESS WHEREOF, Assignor and Assignee have executed this Assignment and
Assumption of Leases.
ASSIGNOR: ASSIGNEE:
_______________________________ _______________________________
_______________________________ _______________________________
By:____________________________ By:____________________________
Authorized Representative
Title:_________________________
Dated:_________________________ Dated:_________________________
2
EXHIBIT A
Legal Description
3
EXHIBIT B
Existing Leases
(rent roll to be attached)
4
EXHIBIT C
Free Rent, Tenant Improvement Allowances and Leasing Commissions
5
Schedule 8.6.5
ASSIGNMENT AND ASSUMPTION OF CONTRACTS AND WARRANTIES
THIS ASSIGNMENT AND ASSUMPTION OF CONTRACTS AND WARRANTIES (the
"Assignment") dated as the dates of execution set forth below, but effective as
of the Conveyance Date (as herein defined), is between
_____________________________ ___________________________________, ("Assignor")
and ________________, a ___________________ ("Assignee").
A. Assignor and Assignee have entered into an Agreement of Purchase
and Sale with an Effective Date of ______________, 1998 (the "Agreement"),
pursuant to which Assignee agreed to purchase Assignor's interest in the real
property legally described on Exhibit A attached hereto (the "Property"), on
the terms and conditions contained therein.
B. Whereas the execution and delivery of this Assignment is a condition
precedent to the purchase of the Property by the Assignee.
ACCORDINGLY, the parties hereby agree as follows:
1. As of the date on which the Property is conveyed to Assignee pursuant
to the Agreement (the "Conveyance Date")[SHOULD BE THE DAY FOLLOWING CLOSING],
Assignor hereby assigns to Assignee all of its right, title, and interest in and
to the following:
2. Assignor hereby grants, transfers and assigns to Assignee all the
right, title and interest of Assignor in and to the following:
(a) All contracts listed on Exhibit B attached hereto.
(b) All presently effective and assignable warranties, guaranties,
representations or covenants given to or made in favor of Assignor or Assignor's
affiliates in connection with the acquisition, development, construction,
maintenance, repair, renovation or inspection of the Property.
The foregoing are collectively referred to herein as the "Contracts."
3. Assignor hereby assumes full responsibility for all obligations and
defaults of Assignor under the Contracts accruing to and including the
Conveyance Date. Assignor also agrees to defend, indemnify and hold Assignee
harmless from any claims, liabilities or costs (including reasonable attorneys'
fees) arising from Assignor's failure to perform said obligations, provided that
Assignee makes a claim hereunder on or before one (1) year following the
Conveyance Date.
4. Assignee hereby assumes full responsibility for all obligations of
owner of the Property under the Contracts accruing after the Conveyance Date
and Assignee hereby agrees to defend, indemnify and hold Assignor harmless
from any claims, liabilities or costs (including reasonable attorneys' fees)
arising from Assignee's failure to perform said obligations.
5. This Assignment shall be governed by the laws of the Commonwealth of
Pennsylvania.
6. This Assignment may be executed in counterparts.
7. The obligations of Assignor contained herein are intended to be
binding only on the property of the Assignor and shall not be personally binding
upon, nor shall any resort be had to the private properties of, any of the
investment managers of Assignor, or any general partners thereof, or any
employees or agents of the investment managers.
IN WITNESS WHEREOF, Assignor and Assignee have executed this Assignment
and Assumption of Contracts and Warranties.
ASSIGNOR: ASSIGNEE:
_______________________________ _______________________________
_______________________________ _______________________________
By:____________________________ By:____________________________
Authorized Representative
Title:_________________________
Dated:_________________________ Dated:_________________________
2
EXHIBIT A
Legal Description
3
EXHIBIT B
Contracts
A.T. BUILDERS
BFI
BERWYN GLASS
BOYLE ELECTRICAL CONTRACTORS
BURHANS GLASS COMPANY, INC.
CONTROLLED ENVIRONMENTS
CROWN CONTRACTORS, INC.
JOSEPH W. DAVIS, INC.
DIROCCO BROTHERS COMPANY
DURASEAL, INC.
ELDREDGE
FIDELITY ALARM COMPANY
GALLAGHER EXCAVATING, INC. (GEI)
GUARDIAN ALARM SYSTEMS
HONEYWELL
MOON LANDSCAPING
OLIVER SPRINKLER
PENNTEX CONSTRUCTION COMPANY
PHOENIX MECHANICAL, INC.
RHETT HAMILTON JONES ASSOCIATES
SANTANGELO HAULING CO.
SECURITY ELEVATOR COMPANY
SYSTEMATIC ROOFING ANALYSIS
TELEPHONE DIAGNOSTIC SERVICES, INC.
TERMINIX INTERNATIONAL CO.
VECTORDYNE
DAVID WHITE PLUMBING
4
Schedule 8.6.6
ASSIGNMENT OF INTANGIBLES
THIS ASSIGNMENT AND ASSUMPTION OF INTANGIBLES ("Assignment") dated
as the dates of execution set forth below, but effective as of the Conveyance
Date (as herein defined), is between ______________________________________,
("Assignor") and ________________, a ___________________ ("Assignee").
A. Assignor and Assignee have entered into an Agreement of Purchase
and Sale with an Effective Date of ______________, 1998 (the "Agreement"),
pursuant to which Assignee agreed to purchase Assignor's interest in the real
property legally described on Exhibit A attached hereto (the "Property"), on
the terms and conditions contained therein.
B. Whereas the execution and delivery of this Assignment is a condition
precedent to the purchase of the Property by the Assignee.
ACCORDINGLY, the parties hereby agree as follows:
1. As of the date on which the Property is conveyed to Assignee pursuant
to the Agreement (the "Conveyance Date")[SHOULD BE THE DAY FOLLOWING CLOSING],
Assignor hereby assigns to Assignee all of its right, title, and interest in and
to the following:
(i) All licenses, permits, certificates of occupancy, approvals,
dedications, subdivision maps or plats and entitlements issued, approved or
granted by federal, state or municipal authorities or otherwise in
connection with the Property and its renovation, construction, use,
maintenance, repair, leasing and operation; and all licenses, consents,
easements, rights of way and approvals required from private parties to
make use of utilities, to insure pedestrian ingress and egress to the
Property and to insure continued use of any vaults under public rights-of-
way presently used in the operation of the Property.
(ii) any trade style or trade name used in connection with the
Property; and,
(iii) all correspondence with the tenants under tenant leases, all
booklets and manuals relating to the maintenance and operation of the
Property.
The foregoing are collectively referred to herein as the "Intangibles".
2. Assignor agrees to assume full responsibility for its obligations
under the Intangibles accruing on or prior to the Conveyance Date and Assignor
agrees to defend, indemnify and hold Assignee harmless from any claims,
liabilities or costs arising from
Assignor's failure to perform said obligations, provided that Assignee makes
a claim hereunder on or before one (1) year following the Conveyance Date.
3. Assignee assumes full responsibility for all obligations of the owner
of the property accruing under the Intangibles from the day after the Conveyance
Date and Assignee agrees to defend, indemnify and hold Assignor and its
predecessors in title harmless from all claims, liabilities or costs arising
from Assignee's failure to perform said obligations.
4. This instrument may be executed in counterparts.
5. The obligations of Assignor contained herein are intended to be
binding only on the property of the Assignor and shall not be personally binding
upon, nor shall any resort be had to the private properties of, any of the
investment managers of Assignor, or any general partners thereof, or any
employees or agents of the investment managers
IN WITNESS WHEREOF, the parties have executed this Assignment of
Intangibles.
ASSIGNOR: ASSIGNEE:
_______________________ ______________________________
_____________________________, ______________________________
By: By:
Authorized Representative
Title:
Dated: Dated:
2
EXHIBIT A
Legal Description
3
Schedule 8.6.8
BILL OF SALE
________________________________________________________________________
("Seller"), in consideration of Ten and No/100 Dollars and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, hereby sells, transfers, assigns and sets over unto
__________________ ("Purchaser"), all of its right, title and interest in and
to any and all personal property, which personal property is owned by Seller
and located on the real estate legally described on Exhibit A attached hereto
(the "Personal Property"), including, but not limited to, the Personal
Property listed on Exhibit B.
Seller hereby represents and warrants to Purchaser that Seller is the
absolute owner of the Personal Property free and clear of all liens, charges and
encumbrances, and that Seller has full right, power and authority to sell the
Personal Property and to make this Bill of Sale. All warranties of quality,
fitness and merchantability are hereby excluded.
The obligations of Seller contained herein are intended to be binding only
on the property of the Seller and shall not be personally binding upon, nor
shall any resort be had to the private properties of, any of the investment
managers of Seller, or any general partners thereof, or any employees or agents
of the investment managers
IN WITNESS WHEREOF, Seller has executed this Bill of Sale as of the ___ day
of _______, 1998, but effective on the date on which the Property is conveyed by
Seller to Purchaser.
______________________________
______________________________
By:___________________________
Authorized Representative
STATE OF _________ )
) SS
COUNTY OF ________ )
The undersigned, a Notary Public in and for said County in the State
aforesaid, DOES HEREBY CERTIFY that ________________, authorized representative
of _________________________________________________________________, who is
personally known to me to be the same person whose name is subscribed to the
foregoing instrument as such authorized representative, appeared before me this
day in person and acknowledged that __he, being duly authorized, signed, sealed
and delivered the said instrument as h___ free and voluntary act, and as the
free and voluntary acts of said corporation, for the uses and purposes therein
set forth.
GIVEN under my hand and Notarial Seal this _____ day of
______________, 1998.
_______________________
Notary Public
My Commission Expires:
____________________, 19___
2
EXHIBIT A
Legal Description
3
EXHIBIT B
Personal Property
(none)
Schedule 8.6.10
SELLER'S CLOSING CERTIFICATE
THIS CLOSING CERTIFICATE is made as of the ___ day of ________________,
1998, by and between ______________________________________________________
("Seller"), to and in favor of ____________________________________________,
a __________ ("Purchaser"), under and pursuant to that certain Agreement of
Purchase and Sale by and between Seller and __________, with an Effective
Date as defined therein (the "Agreement"), for the purchase and sale of that
certain Property situated in the _________, _______ County, ____________ (as
defined in the Agreement).
Pursuant to Paragraphs 5.3 and 8.6.10 of the Agreement and except as
disclosed on Exhibit A attached hereto and made a part hereof, Seller hereby
reconfirms, remakes and rewarrants to Purchaser as of the date hereof each of
the representations, warranties and covenants given by Seller contained in
Paragraph 5.1 of the Agreement in the same manner as such representations,
warranties and covenants were given in the Agreement, each of which is
incorporated herein and made a part hereof by this reference. Except as
modified hereby, Seller hereby confirms that each of said representations,
warranties and covenants are true and accurate in all material respect as of the
date hereof. Seller's reconfirming, remaking and rewarranting of its
representations, warranties and covenants is subject to the limitations set
forth in Paragraph 5.3 of the Agreement.
The obligations of Seller contained herein are intended to be binding only
on the property of the Seller and shall not be personally binding upon, nor
shall any resort be had to the private properties of, any of the investment
managers of Seller, or any general partners thereof, or any employees or agents
of the investment managers
IN WITNESS WHEREOF, Seller has executed this Closing Certificate on the day
and year first above written, but effective upon the date on which the Property
is conveyed by Seller to Purchaser.
SELLER:
_____________________________
_____________________________
By: _____________________________
Authorized Signatory
EXHIBIT A
Disclosure
Schedule 9.7.2
New Lease Approval Form
Property: ___________________________________________________________________
Tenant: _____________________________________________________________________
Square Feet: ________________________________________________________________
Location: ___________________________
Anticipated Lease Commencement: _____________________________________________
Anticipated Rent Commencement: ______________________________________________
Term: _______________________________________________________________________
FREE RENT: __________________________________________________________________
Rental Rate: Period PSF Rate Annual Income
________________ ________________ ________________
________________ ________________ ________________
________________ ________________ ________________
Note: Above rental rates do not include Tenant Electric
Tenant Improvement Allowance: PSF ______________ Amount ___________________ T.I.
Mechanism: ___________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
OPTIONS: ________________ ________________ ________________
________________ ________________ ________________
________________ ________________ ________________
Initial Commission:
BROKER % Amount
__________________ _______________ _________________________________________
__________________ _______________ _________________________________________
Broker Future Entitlements: __________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Other Comments: ______________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
Approved By: ________________
Schedule 9.26
SEC COMPLIANCE REPRESENTATION LETTER
(Accountant Name & Address)
Dear Sirs:
In connection with your audit of the statement of revenues and certain
expenses of the Property situated in the City of King of Prussia, Montgomery
County, Pennsylvania, commonly known as 741 First Avenue (the "Property") for
the year ended December 31, 199__ (the "Operating Statement"), prepared for the
purpose of complying with the rules and regulations of the Securities and
Exchange Commission, the undersigned ("Seller") makes the following limited,
qualified and specific representations, which are true to Seller's knowledge (as
such phrase is hereinafter defined):
1. Seller has made available or caused its property manager to make
available to Brandywine Operating Partnership, L.P. ("Buyer"), or its
representatives, Seller's financial records and files in Seller's
actual possession pertaining to the operation of the Property (such
records and files being collectively referred to herein as the
"Files").
2. Except as disclosed in the Files, Seller is not aware of any events or
transactions which have occurred since December 31, 199_ and prior to
the date hereof that would have a material effect on the Operating
Statement for the period then ended.
3. We recognize that, as the Owner of the Property, we are responsible
for directing the fair presentation of the Operating Statement. We
believe the Operating Statement is fairly presented in conformity with
generally accepted accounting principals.
As used in this letter, the words "Seller's knowledge" shall be deemed to
mean, and shall be limited to, the actual (as distinguished from implied,
imputed or constructive) knowledge of Joseph S. Cappelletti and Barbara
Gillentine without such person having any obligation to make an independent
inquiry or investigation.
Notwithstanding any provision in this letter to the contrary, Seller is
executing this letter solely as an accommodation to and at the request of Buyer
and, except to the extent Seller is liable to Buyer for representations and
warranties expressly set forth in that certain Agreement of Purchase and Sale,
dated _________ 1998, by and between Seller and Buyer (the "Sale Agreement"),
this letter is subject to the condition that Seller shall not be liable or
responsible to Buyer, any parent, subsidiary or other affiliate of Buyer, or any
officer, director, employee, agent, representative, shareholder, partner or
principal of Buyer or any such parent, subsidiary or other affiliate thereof or
any accountant or other professionals engaged by or on behalf of any of the
foregoing, including, without limitation, [accountant] (all of the foregoing
being collectively referred to herein as the "Buyer Parties"), as a result of
the fact that any of the statements made herein are in any way inaccurate,
untrue or incorrect. By the acceptance of this letter, except for rights and
remedies that Buyer may have under the Sale Agreement with respect to
representations and warranties expressly set forth in the Sale Agreement, each
of the Buyer Parties shall be deemed to have waived any and all rights and
remedies that any of them may have against Seller, whether at law or in equity,
as a result of the fact that any of the statements made herein are in any way
inaccurate, untrue or incorrect.
4
Seller has executed this letter for the limited purposes set forth herein,
and for the use of [accountant] only. No other parties may rely on the
statements set forth herein.
Very truly yours,
RREEF MIDAMERICA/EAST FUND-IV,
a California group trust
By: RREEF America L.L.C.,
a Delaware limited liability company
By:_______________________________
Name: Joseph S. Cappelletti
Title: Its Authorized Representative
By: __________________________________
Name: Barbara J. Gillentine
Title: Its Authorized Representative
5
EXHIBIT A
Legal Description of Property