Purchase and Sale Agreement (2002)Full Document 

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                           PURCHASE AND SALE AGREEMENT

                                     BETWEEN

                    FUND I, II, II-OW, VI AND VII ASSOCIATES

                                       AND

                       INFINITY PROPERTY FUND INCORPORATED

                        CHEROKEE COMMONS SHOPPING CENTER

                                 August 6, 2001

                              SCHEDULE OF EXHIBITS

Reference --------- Exhibit "A" Description of Property p 4 ----------- Exhibit "B" List of Personal Property p 5 ----------- Exhibit "C" List of Existing Commission Agreements and Management Agreement pp 2, 4 & Section 4.1(f) ----------- Exhibit "D" Form of Escrow Agreement p 3 ----------- Exhibit "E" Intentionally Omitted ----------- Exhibit "F" Rent Roll p 5 ----------- Exhibit "G" Exception Schedule Section 4.1 ----------- Exhibit "H" List of Operating Agreements p 5 ----------- Exhibit "I" Form of Tenant Estoppel Certificate p 6 & Section 6.1(d) ----------- Exhibit "J" Property Tax Appeals Section 4.1(g) ----------- Exhibit "K" Unpaid Tenant Inducement Costs and Leasing Commissions re current Section 5.4(e) ----------- tenants for which Seller is responsible Exhibit "L" Form of SNDA p 5 -----------
SCHEDULE OF CLOSING DOCUMENTS Schedule 1 Form of Limited Warranty Deed Schedule 2 Form of Assignment and Assumption of Leases and Security Deposits and Leasing Commission Obligations arising after Closing Schedule 3 Form of Bill of Sale to Personal Property Schedule 4 Form of Assignment and Assumption of Operating Agreements Schedule 5 Form of General Assignment of Seller's Interest in Intangible Property Schedule 6 Form of Seller's Affidavit (for Purchaser's Title Insurance Purposes) Schedule 7 Form of Seller's Certificate (as to Seller's Representations and Warranties) Schedule 8 Form of Seller's FIRPTA Affidavit Schedule 9 Form of Seller's Georgia Withholding Tax Affidavit Schedule 10 Form of Purchaser's Certificate (as to Purchaser's Representations and Warranties) Schedule 11 Form of Seller's Estoppel (as to Leases) Schedule 12 Form of Assignment of Declaration PURCHASE AND SALE AGREEMENT CHEROKEE COMMONS SHOPPING CENTER -------------------------------------------------------------------------------- THIS PURCHASE AND SALE AGREEMENT (the "Agreement"), made and entered into --------- this 6th day of August, 2001, by and between FUND I, II, II-OW, VI AND VII ASSOCIATES, a Georgia limited partnership ("Seller"), and INFINITY PROPERTY FUND ------ INCORPORATED, a Florida corporation ("Purchaser"). --------- W I T N E S E T H: - - - - - - - - - WHEREAS, Seller desires to sell certain improved real property commonly known as "Cherokee Commons Shopping Center" located at Highway 92 and Robin Road, Acworth, Cherokee County, Georgia, together with certain related personal and intangible property, and Purchaser desires to purchase such real, personal and intangible property; and WHEREAS, the parties hereto desire to provide for said sale and purchase on the terms and conditions set forth in this Agreement; NOW, THEREFORE, for and in consideration of the premises, the mutual covenants and agreements hereinafter set forth, and for other good and valuable consideration, the receipt, adequacy, and sufficiency of which are hereby acknowledged by the parties hereto, the parties hereto hereby covenant and agree as follows: ARTICLE 1. DEFINITIONS For purposes of this Agreement, each of the following capitalized terms shall have the meaning ascribed to such terms as set forth below: "Ancillary Closing Documents" shall mean, collectively, the Assignment and --------------------------- Assumption of Leases, the Assignment and Assumption of Operating Agreements, the General Assignment, and the Seller's Certificate. "Assignment and Assumption of Leases" shall mean the form of assignment and ----------------------------------- assumption of Leases and Security Deposits and obligations under the Commission Agreements to be executed and delivered by Seller and Purchaser at the Closing in the form attached hereto as Schedule 2. "Assignment and Assumption of Operating Agreements" shall mean the form of ------------------------------------------------- assignment and assumption of the Operating Contracts to be executed and delivered by Seller and Purchaser at the Closing in the form attached hereto as Schedule 4. "Assignment of Declaration" shall mean the form of assignment and ------------------------- assumption of the Declaration to be executed by Seller and Purchaser at the Closing in the form attached hereto as Schedule 12. "Bill of Sale" shall mean the form of bill of sale to the Personal Property ------------ to be executed and delivered by Seller to Purchaser at the Closing in the form attached hereto as Schedule 3. "Broker" shall have the meaning ascribed thereto in Section 10.1 hereof. ------ "Business Day" shall mean any day other than a Saturday, Sunday or other ------------ day on which banking institutions in the State of Georgia are authorized by law or executive action to close. "Closing" shall mean the consummation of the purchase and sale of the ------- Property pursuant to the terms of this Agreement. "Closing Date" shall have the meaning ascribed thereto in Section 2.6 ------------ hereof. "Commission Agreements" shall have the meaning ascribed thereto in Section --------------------- 4.1(f) hereof, and such agreements are more particularly described on Exhibit "C" attached hereto and made a part hereof. "Declaration" shall mean that certain Declaration of Easements dated May 5, ----------- 1986, recorded in Deed Book 530, page 636, Cherokee County, Georgia records, as amended by Modification of Declaration dated May 16, 1987, recorded in Deed Book 614, page 517, and re-recorded in Deed Book 618, page 579, in the aforesaid records. "Due Diligence Material" shall have the meaning ascribed thereto in Section ---------------------- 3.7 hereof. "Earnest Money" shall mean the Initial Earnest Money, together with all ------------- interest which accrues thereon as provided in Section 2.3(b) hereof and in the Escrow Agreement. "Effective Date" shall mean the last date upon which the following shall -------------- have occurred: (a) Purchaser and Seller shall have delivered at least two (2) fully executed counterparts of this Agreement to the other, (b) Purchaser, Seller and Escrow Agent shall have executed and delivered at least one (1) fully executed counterpart of the Escrow Agreement to each other party, and (c) Purchaser shall have delivered the Initial Earnest Money (by federal wire transfer or delivery of Purchaser's check made payable to Escrow Agent) to Escrow Agent. "Environmental Law" shall mean any law, ordinance, rule, regulation, order, ----------------- judgment, injunction or decree relating to pollution or substances or materials which are considered to be hazardous or toxic, including, without limitation, the Resource Conservation and Recovery Act, the Comprehensive Environmental Response, Compensation and Liability Act, the Hazardous Materials Transportation Act, the Clean Water Act, the Toxic Substances Control Act, the Emergency Planning and Community Right to Know Act, any state and local environmental law (including, without limitation, the Georgia Hazardous Site Response Act ("HSRA")), all amendments and supplements to any of the foregoing and all regulations and publications promulgated or issued pursuant thereto. "Escrow Agent" shall mean the Title Company, at its office at 3350 ------------ Riverwood Parkway, Suite 1895, in Atlanta, Georgia 30339. "Escrow Agreement" shall mean that certain Escrow Agreement in the form ---------------- attached hereto as Exhibit "D" entered into contemporaneously with the execution and delivery of this Agreement by Seller, Purchaser and Escrow Agent with respect to the Earnest Money. "Existing Survey" shall mean that certain survey with respect to the Land --------------- and the Improvements prepared by Quadra-Tech, Inc. dated June 2, 1986, and last revised June 25, 1987. "FIRPTA Affidavit" shall mean the form of FIRPTA Affidavit to be executed ---------------- and delivered by Seller to Purchaser at Closing in the form attached hereto as Schedule 8. "First Title Notice" shall have the meaning ascribed thereto in Section 3.4 ------------------ hereof. "General Assignment" shall have the meaning ascribed thereto in Section ------------------ 5.1(g) hereof. "Hazardous Substances" shall mean any and all pollutants, contaminants, -------------------- toxic or hazardous wastes or any other substances that might pose a hazard to health or safety, the removal of which may be required or the generation, manufacture, refining, production, processing, treatment, storage, handling, transportation, transfer, use, disposal, release, discharge, spillage, seepage or filtration of which is or shall be restricted, prohibited or penalized under any Environmental Law (including, without limitation, lead paint, asbestos, urea formaldehyde foam insulation, petroleum and any part thereof or related products and polychlorinated biphenyls). "Improvements" shall mean all buildings, structures and improvements now or ------------ on the Closing Date situated on the Land, including without limitation, all parking areas and facilities, improvements and fixtures located on the Land. "Initial Earnest Money" shall mean the sum of One Hundred Thousand and --------------------- No/100 Dollars ($100,000.00 U.S.). "Inspection Period" shall mean the period expiring at 5:00 P.M. Eastern ----------------- Standard Time on September 25, 2001. "Intangible Property" shall mean all intangible property, if any, owned by ------------------- Seller and related to the Land and Improvements, including without limitation, Seller's rights and interests, if any, in and to the following (to the extent assignable): (i) the name "Cherokee Commons Shopping Center", (ii) all assignable plans and specifications and other architectural and engineering drawings for the Land and Improvements; (iii) all assignable warranties or guaranties given or made in respect of the Improvements or Personal Property; (iv) all transferable consents, authorizations, variances or waivers, certificates of occupancy, licenses, permits and approvals from any governmental or quasi-governmental agency, department, board, commission, bureau or other entity or instrumentality solely in respect of the Land or Improvements; (v) all of Seller's right, title and interest in and to all assignable Operating Agreements that Purchaser agrees to assume (or is deemed to have agreed to assume); and (vi) the EPA ID Number (as hereinafter defined).. "Land" shall mean those certain tracts or parcels of real property located ---- in Cherokee County, Georgia, which are more particularly described on Exhibit "A" attached hereto and made a part hereof, together with all rights, privileges and easements appurtenant to said real property, and all right, title and interest of Seller, if any, in and to any land lying in the bed of any street, road, alley or right-of-way, open or closed, adjacent to or abutting the Land. "Lease" and "Leases" shall mean the leases or occupancy agreements, ----- ------ including those in effect on the Effective Date which are more particularly identified on Exhibit "F" attached hereto, and any amended or new leases entered into pursuant to Section 4.3(a) of this Agreement, which as of the Closing affect all or any portion of the Land or Improvements. "Major Tenant" shall mean The Kroger Co. ------------ "Management Agreement" shall have the meaning ascribed thereto in Section -------------------- 4.1(f) hereof and is more particularly described on Exhibit "C" attached hereto and made a part hereof. "Monetary Objection " or "Monetary Objections" shall mean (a) any mortgage, ------------------ ------------------- deed to secure debt, deed of trust or similar security instrument encumbering all or any part of the Property, (b) any mechanic's, materialman's or similar lien (unless resulting from any act or omission of Purchaser or any of its agents, contractors, representatives or employees or any tenant of the Property), (c) the lien of ad valorem real or personal property taxes, assessments and governmental charges affecting all or any portion of the Property which are delinquent, and (d) any judgment of record against Seller in the county or other applicable jurisdiction in which the Property is located. "Operating Agreements" shall mean all those certain contracts and -------------------- agreements more particularly described on Exhibit "H" attached hereto and made a part hereof relating to the repair, maintenance or operation of the Land, Improvements or Personal Property which will extend beyond the Closing Date, including, without limitation, all equipment leases. "Other Notices of Sale" shall have the meaning ascribed thereto in Section --------------------- 5.1(s) hereof. "Permitted Exceptions" shall mean, collectively, (a) liens for taxes, -------------------- assessments and governmental charges not yet due and payable or due and payable but not yet delinquent, (b) the Leases, and (c) such other easements, restrictions and encumbrances that do not constitute Monetary Objections. "Personal Property" shall mean all furniture (including common area ----------------- furnishings and interior landscaping items), carpeting, draperies, appliances, personal property (excluding any computer software which either is licensed to Seller or Seller deems proprietary), machinery, apparatus and equipment owned by Seller and currently used exclusively in the operation, repair and maintenance of the Land and Improvements and situated thereon, as generally described on Exhibit "B" attached hereto and made a part hereof, and all non-confidential books, records and files (excluding any appraisals, budgets, strategic plans for the Property, internal analyses, information regarding the marketing of the Property for sale, submissions relating to Seller's obtaining of corporate or partnership authorization, attorney and accountant work product, attorney-client privileged documents, or other information in the possession or control of Seller or Seller's property manager which Seller deems proprietary) relating to the Land and Improvements. The Personal Property does not include any property owned by tenants, contractors or licensees, and shall be conveyed by Seller to Purchaser subject to depletions, replacements and additions in the ordinary course of Seller's business. "Property" shall have the meaning ascribed thereto in Section 2.1 hereof. -------- "Purchase Price" shall be the amount specified in Section 2.4 hereof. -------------- "Purchaser's Certificate" shall have the meaning ascribed thereto in Section 5.2(d) hereof. "Rent Roll" shall mean Exhibit "F" attached to this Agreement and made a --------- part hereof. "Security Deposits" shall mean any security deposits, rent or damage ----------------- deposits or similar amounts (other than rent paid for the month in which the Closing occurs) actually held by Seller with respect to any of the Leases. "Seller's Affidavit" shall mean the form of owner's affidavit to be given ------------------ by Seller at Closing to the Title Company in the form attached hereto as Schedule 6. "Seller's Certificate" shall mean the form of certificate to be executed -------------------- and delivered by Seller to Purchaser at the Closing with respect to the truth and accuracy of Seller's warranties and representations contained in this Agreement (modified and updated as the circumstances require), in the form attached hereto as Schedule 7. "Seller's Estoppel" shall mean the form of estoppel that may be executed ----------------- and delivered by Seller at Closing in substantially the form attached hereto as Schedule 11, as contemplated in Section 6.1(d) hereof. "SNDA" shall mean the Subordination, Non-Disturbance and Attornment ---- Agreement to be sought from tenants leasing premises comprising 15,000 square feet or more at the Property in substantially the form attached hereto as Exhibit "L", as contemplated in Section 4.3(f) hereof. "Survey" and "Surveys" shall have the meaning ascribed thereto in Section ------ ------- 3.4 hereof. "Taxes" shall have the meaning ascribed thereto in Section 5.4(a) hereof. ----- "Tenant Estoppel Certificate" or "Tenant Estoppel Certificates" shall mean --------------------------- ---------------------------- certificates to be sought from the tenants under the Leases in substantially the form attached hereto as Exhibit "I"; provided, however, if any Lease provides for the form or content of an estoppel certificate from the tenant thereunder, the Tenant Estoppel Certificate with respect to such Lease may be in the form as called for therein. "Tenant Inducement Costs" shall mean any out-of-pocket payments required ----------------------- under a Lease to be paid by the landlord thereunder to or for the benefit of the tenant thereunder which is in the nature of a tenant inducement, including specifically, but without limitation, tenant improvement costs, lease buyout payments, and moving, design, refurbishment and club membership allowances and costs. The term "Tenant Inducement Costs" shall not include loss of income resulting from any free rental period, it being understood and agreed that Seller shall bear the loss resulting from any free rental period until the Closing Date and that Purchaser shall bear such loss from and after the Closing Date. "Tenant Notices of Sale" shall have the meaning ascribed thereto in Section ---------------------- 5.1(r) hereof. "Title Company" shall mean Lawyers Title Insurance Corporation. ------------- "Title Commitment" shall have the meaning ascribed thereto in Section 3.4 ---------------- hereof. "Warranty Deed" shall mean the form of deed attached hereto as Schedule 1. ------------- ARTICLE 2. PURCHASE AND SALE 2.1. Agreement to Sell and Purchase. Subject to and in accordance with the ------------------------------ terms and provisions of this Agreement, Seller agrees to sell and Purchaser agrees to purchase, the following property (collectively, the "Property"): -------- (a) the Land; (b) the Improvements; (c) all of Seller's right, title and interest in and to the Leases, any guaranties of the Leases and the Security Deposits; (d) the Personal Property; and (e) the Intangible Property. 2.2. Permitted Exceptions. The Property shall be conveyed subject to the -------------------- matters which are, or are deemed to be, Permitted Exceptions. 2.3. Earnest Money. ------------- (a) Contemporaneously with Purchaser's execution and delivery of this Agreement, Purchaser has delivered the Initial Earnest Money to Escrow Agent by federal wire transfer or by Purchaser's check, payable to Escrow Agent, which Initial Earnest Money shall be held and released by Escrow Agent in accordance with the terms of the Escrow Agreement. (b) The Earnest Money shall be applied to the Purchase Price at the Closing and shall otherwise be held, refunded, or disbursed in accordance with the terms of the Escrow Agreement and this Agreement. All interest and other income from time to time earned on the Initial Earnest Money shall be earned for the account of Purchaser, and shall be a part of the Earnest Money; and the Earnest Money hereunder shall be comprised of the Initial Earnest Money and all such interest and other income. 2.4. Purchase Price. Subject to adjustment and credits as otherwise -------------- specified in this Section 2.4 and elsewhere in this Agreement, the purchase price (the "Purchase Price") to be paid by Purchaser to Seller for the Property -------------- shall be EIGHT MILLION SIX HUNDRED SIXTY THOUSAND AND NO/100 DOLLARS ($8,660,000.00 U.S.). The Purchase Price shall be paid by Purchaser to Seller at the Closing as follows: (a) The Earnest Money shall be paid by Escrow Agent to Seller at Closing; and (b) An amount equal to the Purchase Price shall be paid by Purchaser to Seller at the Closing by Cashier's Check or by wire transfer of immediately available federal funds to an account designated by Seller, less the amount of the Earnest Money paid by Escrow Agent to Seller at Closing, and subject to prorations, adjustments and credits as otherwise specified in this Agreement. 2.5. Independent Contract Consideration. In addition to, and not in lieu of ---------------------------------- the delivery to Escrow Agent of the Initial Earnest Money, Purchaser has delivered to Seller, concurrently with Purchaser's execution and delivery of this Agreement to Seller, the sum of Ten and No/100 Dollars ($10.00), the receipt of which is hereby acknowledged by Seller. Seller and Purchaser hereby mutually acknowledge and agree that said sum represents adequate bargained for consideration for Seller's execution and delivery of this Agreement and Purchaser's right to inspect the Property pursuant to Article III. Said sum is in addition to and independent of any other consideration or payment provided for in this Agreement and is nonrefundable in all events. 2.6. Closing. The consummation of the sale by Seller and purchase by ------- Purchaser of the Property (the "Closing") shall be held on any date on or before ------- the date which is fifteen (15) days following the expiration of the Inspection Period. Subject to the foregoing, the Closing shall take place at an office in the metropolitan Atlanta, Georgia area, and at such specific place, time and date (the "Closing Date") as shall be designated by Purchaser in a written ------------ notice to Seller not less than three (3) Business Days prior to Closing. If Purchaser fails to give such notice of the Closing Date, the Closing shall be at the offices of Troutman Sanders LLP, Suite 5200, 600 Peachtree Street, N.E., Atlanta, Georgia 30308-2216, at 2:00 p.m. on the outside date for Closing as provided above. ARTICLE 3. PURCHASER'S INSPECTION AND REVIEW RIGHTS 3.1. Due Diligence Inspections. ------------------------- (a) From and after the Effective Date until the Closing Date or earlier termination of this Agreement, Seller shall permit Purchaser and its authorized representatives to inspect the Property to perform due diligence, soil analysis and environmental investigations, to examine the records of Seller with respect to the Property, and make copies thereof, at such times during normal business hours as Purchaser or its representatives may request. All such inspections shall be nondestructive in nature, and specifically shall not include any physically intrusive testing. All such inspections shall be performed in such a manner to minimize any interference with the business of the tenants under the Leases at the Property and, in each case, in compliance with Seller's rights and obligations as landlord under the Leases. All inspection fees, appraisal fees, engineering fees and all other costs and expenses of any kind incurred by
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