CONTRIBUTION AGREEMENT
with respect to
UB STAMFORD, L.P.
by and among
STAMFORD RIDGEWAY ASSOCIATES LIMITED PARTNERSHIP
UB STAMFORD, L.P.
and
URSTADT BIDDLE PROPERTIES INC.
Dated as of March 25, 2002
DKH STAMFORD ASSOCIATES, L. P. ("DKH"), A PARTNER OF CIRRUS RIDGEWAY ASSOCIATES,
L.P., ITSELF A PARTNER OF STAMFORD RIDGEWAY ASSOCIATES LIMITED PARTNERSHIP, WILL
BE DEEMED TO BE MAKING A DECISION TO INVEST IN UNITS OF LIMITED PARTNERSHIP
INTEREST IN UB STAMFORD, L.P. IN MAKING THAT INVESTMENT DECISION, DKH MUST RELY
ON THEIR OWN EXAMINATION OF THE ISSUER OF THOSE SECURITIES AND THE TERMS OF THE
INVESTMENT, INCLUDING THE MERITS OF THE INVESTMENT AND THE RISKS INVOLVED. THESE
SECURITIES HAVE NOT BEEN RECOMMENDED BY ANY FEDERAL OR STATE SECURITIES
COMMISSION OR REGULATORY AUTHORITY. FURTHERMORE, THE FOREGOING AUTHORITIES HAVE
NOT CONFIRMED THE ACCURACY OR ADEQUACY OF THIS DOCUMENT. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
THESE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE AND
MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, AND THE APPLICABLE STATE SECURITIES LAWS, PURSUANT TO
REGISTRATION OR EXEMPTION THEREFROM. INVESTORS SHOULD BE AWARE THAT THEY MAY BE
REQUIRED TO BEAR THE FINANCIAL RISK OF THIS INVESTMENT FOR AN INDEFINITE PERIOD
OF TIME.
TABLE OF CONTENTS
Page
2. CONTRIBUTION; LP UNITS; TAX MATTERS.....................................................................1
(a) General...............................................................................1
(b) Contribution Consideration............................................................2
(c) LP Units..............................................................................2
(d) [intentionally deleted]...............................................................3
(e) Transfer Restrictions.................................................................3
(f) Prorations and Adjustments............................................................3
(g) Earnest Money.........................................................................3
3. CLOSING.................................................................................................4
4. CONTRIBUTOR'S PRE-CLOSING DELIVERIES....................................................................4
5. TRANSACTION SPECIFIC CONDITIONS PRECEDENT...............................................................5
(a) Cappelli Litigation...................................................................5
(b) Stop & Shop Claims....................................................................5
(c) Assumption of Existing Mortgage.......................................................5
(d) Violation of Lease Exclusions.........................................................5
(e) Cives Mechanic's Lien.................................................................5
(f) Release of Construction Mortgage......................................................5
6. TITLE AND SURVEY MATTERS................................................................................6
(a) Conveyance of Title...................................................................6
(b) Title Commitment......................................................................6
(c) Survey................................................................................6
(d) UCC Searches..........................................................................6
7. REPRESENTATIONS AND WARRANTIES; CERTAIN COVENANTS.......................................................6
7.1 Contributor....................................................................................6
(a) Title.................................................................................6
(b) Contributor's Deliveries..............................................................7
(c) Defaults..............................................................................7
(d) Contracts.............................................................................7
(e) Physical Condition....................................................................7
(f) Employees.............................................................................7
(g) Compliance with Laws and Codes........................................................8
(h) Litigation............................................................................8
(i) Insurance.............................................................................8
(j) Re-Zoning; Zoning.....................................................................8
(k) Authority of Contributor..............................................................9
(l) Real Estate Taxes.....................................................................9
(m) Taxes.................................................................................9
(n) Easements and Other Agreements........................................................9
(o) [intentionally deleted]...............................................................9
(p) FIRPTA...............................................................................10
(q) Existing Mortgage....................................................................10
(r) Condemnation.........................................................................10
(s) Disclosure...........................................................................10
(t) Organization and Ownership...........................................................10
7.2 The REIT......................................................................................11
(a) Existence and Power..................................................................11
(b) Notice of Violations.................................................................11
(c) REIT Qualification...................................................................11
(d) Authorization........................................................................11
(e) Pending Actions......................................................................12
(f) Accreditation status of DKH..........................................................12
(g) Availability of records, etc.........................................................12
(h) Disclosure...........................................................................12
7.3 Acquiror......................................................................................12
(a) Existence and Power..................................................................13
(b) Notice of Violations.................................................................13
(c) Authorization........................................................................13
(d) Pending Actions......................................................................13
(e) Accreditation status of DKH..........................................................13
(f) Availability of records, etc.........................................................14
(g) Disclosure...........................................................................14
8. ADDITIONAL COVENANTS OF CONTRIBUTOR....................................................................14
(a) Assignment of Escrows and Reserves...................................................14
(b) Pre-Closing Expenses.................................................................14
(c) Good Faith...........................................................................15
(d) Availability of Records..............................................................15
(e) Existing Mortgage....................................................................15
(f) Existing Management Agreement........................................................15
9. ENVIRONMENTAL WARRANTIES AND AGREEMENTS................................................................15
(a) Definitions..........................................................................15
(b) Representations and Warranties.......................................................16
10. ADDITIONAL CONDITIONS PRECEDENT TO CLOSING.............................................................16
(a) Pending Actions......................................................................16
(b) Utilities............................................................................17
(c) Bankruptcy...........................................................................17
(d) Covenants Performed..................................................................17
(e) Title to the Property................................................................17
(f) Partnership Consents.................................................................17
(g) Continued Accuracy of Representations, etc...........................................17
(h) Title Policy.........................................................................17
11. LEASES CONDITIONS PRECEDENT AND REPRESENTATIONS WITH RESPECT THERETO...................................17
(a) Representations as to Leases.........................................................17
(b) Estoppel Certificates and Subordination Agreements from Tenants......................19
12. CLOSING DELIVERIES.....................................................................................19
12.1 Contributor...................................................................................19
(a) Deeds................................................................................19
(b) Bill of Sale.........................................................................19
(c) General Assignment...................................................................20
(d) Assignment of Contracts..............................................................20
(e) Assignment of Leases.................................................................20
(f) Assignment of Lenders' Reserves......................................................20
(g) Keys.................................................................................20
(h) Affidavit of Title...................................................................20
(i) Letters to Tenants...................................................................20
(j) Original Documents...................................................................20
(k) Closing Statement....................................................................20
(l) Plans and Specifications.............................................................20
(m) Rent Roll............................................................................20
(n) FIRPTA Affidavit.....................................................................21
(o) Contributor's Certificate............................................................21
(p) Estoppel Certificates................................................................21
(q) Conveyance Tax Returns and Checks....................................................21
(r) Good Standing Certificate............................................................21
(s) Authorization........................................................................21
(t) Prorations and Adjustments...........................................................21
(u) Lender's Consent.....................................................................21
(v) Lender's Estoppel Certificate........................................................21
(w) Earnest Money........................................................................21
(x) Other................................................................................21
12.2 The REIT......................................................................................22
(a) Assignment and Assumption of Contracts...............................................22
(b) Assignment and Assumption of Leases..................................................22
(c) Contract Notices.....................................................................22
(d) Closing Statement....................................................................22
(e) REIT's and Acquiror's Certificates...................................................22
(f) Prorations and Adjustments...........................................................22
(g) Assumption of Existing Mortgage......................................................22
(h) Other................................................................................22
13. PRORATIONS AND ADJUSTMENTS.............................................................................22
14. CLOSING EXPENSES.......................................................................................24
15. DEFAULT BY REIT........................................................................................24
16. SUCCESSORS AND ASSIGNS.................................................................................24
17. LITIGATION.............................................................................................25
18. NOTICES................................................................................................25
19. BENEFIT................................................................................................26
20. LIMITATION OF LIABILITY................................................................................26
21. BROKERAGE..............................................................................................27
22. REASONABLE EFFORTS.....................................................................................27
23. POST-CLOSING LEASING...................................................................................27
24. INDEMNIFICATION........................................................................................27
25. CONDEMNATION AND CASUALTY..............................................................................28
26. MISCELLANEOUS..........................................................................................30
(a) Entire Agreement.....................................................................30
(b) Time of the Essence..................................................................30
(c) Waiver of Conditions.................................................................30
(d) Representations and Warranties.......................................................30
(e) Construction.........................................................................30
(f) Governing Law........................................................................30
(g) Partial Invalidity...................................................................31
(h) Expenses.............................................................................31
(i) Certain Securities Matters...........................................................31
(j) Counterparts.........................................................................31
(k) Confidentiality......................................................................31
(l) Jurisdiction.........................................................................31
THIS CONTRIBUTION AGREEMENT is made and entered into as of
this 25th day of March, 2002 (the "Effective Date") by and among Stamford
Ridgeway Associates Limited Partnership, a Connecticut limited partnership, and
its successors and assigns ("Contributor"), Urstadt Biddle Properties Inc., a
Maryland corporation (the "REIT"), and UB Stamford, L.P., a Delaware limited
partnership ("Acquiror").
1. CONTRIBUTION. At Closing (as defined herein), Contributor shall contribute
and convey to Acquiror, and Acquiror shall accept and assume from Contributor,
for the Contribution Consideration (as defined below), and pursuant to the terms
and subject to the conditions set forth in this Agreement, all of Contributor's
right, title and interest in and to the Property (as defined below). The
contribution and conveyance of the Property shall be made subject to the
Existing Mortgage (as defined below) and other Permitted Exceptions (defined
below) and other matters set forth herein.
For purposes of this Agreement, "Property" means: (i) the land
as described in Exhibit A (the "Land") and the improvements thereon known as the
Stamford Ridgeway Center (the "Shopping Center"), together with all easements,
rights of way, strips, gores, privileges, licenses, appurtenants and other
rights, benefits and interests appurtenant thereto, including, but not limited
to, all right, title and interest of Contributor in and to any streets or other
public ways adjacent to the Shopping Center and any water or mineral rights
owned by, or leased to, Contributor; (ii) all improvements located on the
Property owned by the Contributor, including, but not limited to, the Shopping
Center, and all other structures, systems, and utilities associated with, and
utilized by, Contributor in the ownership and operation of the Shopping Center
(all such improvements being collectively referred to herein as the
"Improvements"), but excluding improvements, if any, owned by Tenants and
subtenants of the Shopping Center; (iii) all tangible personal property owned by
Contributor and (x) located on or in the Land and (y) used in connection with
the operation and maintenance of the Shopping Center (collectively, the
"Personal Property"); (iv) all building materials, supplies, hardware, carpeting
and other inventory owned by Contributor and maintained in connection with
Contributor's ownership and operation of the Shopping Center (collectively, the
"Inventory"); (v) Contributor's interest in all trademarks, trade names,
development rights and entitlements and other intangible property used in
connection with the Shopping Center (collectively, the "Intangible Personal
Property"); and (vi) Contributor's interest in all leases and other agreements
to occupy all or any portion of the Land in effect on the Closing Date (as
defined below) or into which Contributor enters prior to Closing, but pursuant
to the express terms of this Agreement, excluding all rights and payments and
causes of action under any previously expired or terminated leases
(collectively, the "Leases").
2. CONTRIBUTION; LP UNITS; TAX MATTERS.
-----------------------------------
(a) General. At Closing, the REIT which is Acquiror's sole general partner, will
contribute cash to Acquiror equal to the amount of Contribution Consideration
(as defined below) to be paid in cash. The REIT is a Maryland corporation that
has elected to be taxed as a real estate investment trust, whose Class A Common
Stock, par value $.01 per share (the "Class A Common Stock"), is traded on the
New York Stock Exchange (the "NYSE").
(b) Contribution Consideration. The aggregate consideration to be paid and/or
issued by Acquiror for the Property (the "Contribution Consideration") shall
consist of (x) an amount, in cash and such number of LP Units (as defined
below), as have an aggregate value that equals the difference between (i) Eighty
Nine Million Two Hundred Eighty Thousand and no/100 ($89,280,000) Dollars, and
(ii) the outstanding principal amount of the first mortgage indebtedness owed to
Ridgeway Funding Company encumbering the Property (the "Existing Mortgage"), on
the Closing Date, subject to the adjustments contemplated in this Agreement.
Ninety percent (90%) of the Contribution Consideration shall be in cash and ten
percent (10%) shall be in the form of LP Units. Contributor agrees to dissolve
at or shortly after the closing contemplated under the Agreement and, by
execution hereof, agrees to assign or distribute to Cirrus Ridgeway Associates,
L.P. ("CRALP"), a partner of Contributor, all of the Contributor's rights to
receive the LP Units. The parties acknowledge that CRALP intends to dissolve at
or shortly after the closing contemplated under the Agreement and intends to
assign or distribute to DKH Stamford Associates, L.P. ("DKH"), a partner of
CRALP, all of CRALP's rights to receive the LP Units. In connection with the
dissolution of Contributor, the Contribution Consideration shall be issued or
paid to the partners of Contributor ("Contributor's Partners") in the amounts
(the "Partner's Liquidation Amounts") and in the form specified on Schedule 2(b)
attached hereto and incorporated herein by reference. At the Closing (as defined
below) the Acquiror shall (i) issue and deliver to CRALP its pro rata share
(based on the Partners' Liquidation Amounts for CRALP specified on Schedule 2(b)
hereto) of the Contribution Consideration in cash and LP Units calculated in the
manner as provided in Subparagraph 2(c)(ii) below. If the calculation of the
Contribution Consideration or Adjustments (as defined below) otherwise payable
in LP Units in accordance with Subparagraph 2(c)(ii) or 2(g) would result in a
fraction of an LP Unit being delivered to Contributor, Acquiror shall pay cash
in lieu of that fraction. Provided that all conditions precedent to the REIT's
obligations to close in this Agreement (collectively, the "REIT's Conditions
Precedent") have been satisfied and fulfilled, or waived in writing by the REIT,
the REIT shall cause the Acquiror to issue its LP Units to DKH at Closing
pursuant to Subparagraph 2(c).
(c) LP Units.
---------
(i) Ten percent of the Contribution Consideration shall be paid at the Closing
by Acquiror's issuance and delivery of units of limited partnership interest in
Acquiror (the "LP Units"). Contributor intends to dissolve at or shortly after
the closing contemplated under the Agreement. In connection with such
dissolution, Contributor hereby agrees to assign or distribute its entire
interest in the LP Units directly to CRALP. The issuance of the LP Units to DKH
shall be evidenced by the execution and delivery of Acquiror's agreement of
limited partnership (the "Partnership Agreement"), which shall be executed and
delivered by the REIT and DKH, in substantially the form attached to the
Investor Materials (defined below), at Closing.
(ii) The number of LP Units to be issued shall be equal to the Contribution
Consideration to be issued in the form of LP Units divided by a "Unit Price,"
which shall be equal to the average of the last reported sales prices of the
Class A Common Stock for the 30 consecutive NYSE trading days preceding, but
excluding the five trading days prior to, the Closing Date.
(iii) CRALP and DKH intend to treat the receipt of LP Units in exchange for the
Property as a tax-deferred partnership contribution (the "Tax-Deferred
Contribution") pursuant to Section 721 of the Internal Revenue Code of 1986, as
amended (the "Code"). The REIT and Contributor shall cooperate in all reasonable
respects with CRALP and DKH to effectuate such Tax-Deferred Contribution;
provided, that:
(A) Except as set forth in this Agreement or the Partnership Agreement, neither
Acquiror nor the REIT shall be required to incur any additional cost or expense,
or incur any additional liability, as a result of such Tax-Deferred
Contribution, other than the cost of the REIT's counsel in connection with the
preparation of this Agreement and the Partnership Agreement; and
(B) Subject to the REIT's performance and fulfillment in all material respects
of the covenants and conditions in the Partnership Agreement and this Agreement,
neither Contributor, Acquiror nor the REIT warrants, nor shall any of them be
responsible for, the tax consequences to CRALP or DKH of the transactions
contemplated by this Agreement.
(d) [intentionally deleted]
-----------------------
(e) Transfer Restrictions. Contributor shall distribute all of its rights to the
LP Units to CRALP in partial liquidation of such partner's interests in
Contributor promptly following the Closing. Except as provided in the preceding
sentence, Contributor shall not sell, transfer, assign, pledge or encumber, or
otherwise convey any of its rights to receive LP Units (any of the foregoing, a
"Transfer"). This Subparagraph 2(e) shall survive the Closing.
(f) Prorations and Adjustments. At Closing, all amounts payable by Contributor
or the REIT, as the case may be, to the other party in respect of any prorations
described in this Agreement ("Prorations") or adjustments described in this
Agreement ("Adjustments") which have occurred on or prior to the Closing Date
shall be paid in accordance with the terms of this Agreement. The net amount
payable to the appropriate party in respect of any such Prorations and
Adjustments shall be paid in cash and may take the form of official or certified
unendorsed check or wire transfer payable directly to the payee thereof. At the
request of CRALP, CRALP's pro rata share of such Prorations and adjustment shall
be paid in the form of LP Units, subject to the limitation set forth in
Subparagraph 2(b).
(g) Earnest Money. Simultaneously with the Contributor's execution of this
Agreement, the REIT will deposit, as an earnest money deposit (the "Earnest
Money"), in escrow with Lawyers Title Insurance Corporation (the "Escrowee"),
the sum of One Million Five Hundred Thousand Dollars ($1,500,000.00), in the
form of a certified or bank check or by wire transfer of immediately available
funds, to be held in accordance with the terms of a separate Escrow Agreement,
dated as of March 25, 2002 between the REIT, Contributor and Escrowee. In the
event that the REIT terminates its obligations with respect to the contribution
transaction contemplated herein in accordance with the terms hereof, the entire
amount of such Earnest Money shall be returned to the REIT. Escrowee shall
invest the Earnest Money in either a federally insured money market account,
United States Treasury Bills, or such other instruments as the REIT and the
Contributor may agree upon. At Closing, the Earnest Money, together with all
accrued interest and dividends thereon, will be credited against the portion of
the Contribution Consideration payable in cash to Contributor's Partners, with
any balance returned to the REIT, with the REIT responsible for any tax payable
on the interest that accrues on the Earnest Money in such event. Any and all
interest and dividends earned on the Earnest Money shall be paid over to the
party entitled to the receipt of the Earnest Money under the terms of this
Agreement, which party shall, except as provided in the preceding sentence, be
responsible for any tax payable on the interest that accrues on the Earnest
Money in such event. UPON A DEFAULT BY THE REIT AFTER THIS AGREEMENT HAS BEEN
FULLY EXECUTED AND PRIOR TO THE CLOSING, THE CONTRIBUTOR'S AND ITS PARTNERS'
SOLE AND EXCLUSIVE REMEDY SHALL BE TO EITHER (1) TERMINATE THIS AGREEMENT AND
RETAIN THE EARNEST MONEY (AND ALL INTEREST ACCRUED THEREON) AS LIQUIDATED
DAMAGES, OR (2) SEEK SPECIFIC PERFORMANCE OF THE REIT'S AND ACQUIROR'S
OBLIGATIONS UNDER THIS AGREEMENT. UPON A DEFAULT BY CONTRIBUTOR AFTER THIS
AGREEMENT HAS BEEN FULLY EXECUTED AND PRIOR TO CLOSING, THE REIT MAY (1)
TERMINATE THIS AGREEMENT, IN WHICH EVENT THE EARNEST MONEY AND ALL INTEREST
ACCRUED THEREON SHALL BE RETURNED TO THE REIT, (2) SEEK SPECIFIC PERFORMANCE,
AND/OR (3) PURSUE ANY OTHER REMEDY AVAILABLE IN LAW OR EQUITY (OTHER THAN
CONSEQUENTIAL DAMAGES).
3. CLOSING. The contribution of the Property and the delivery of LP Units and
other consideration contemplated herein shall be consummated at a closing (the
"Closing") at the offices of the REIT's counsel, Cummings & Lockwood LLC, Four
Stamford Plaza, P.O. Box 120, Stamford, CT 06904, or at such other location
reasonably requested by the Lender (as defined below) on the basis of a "New
York-style" closing with a representative of the Title Company (as defined
below) in attendance. The Closing shall occur on or before May 24, 2002, being a
date sixty (60) days following the Effective Date, provided that all the
conditions precedent contemplated by this Agreement have been satisfied or
waived by such date. In the event the Closing contemplated hereunder has not
occurred on or before May 24, 2002, either of the parties shall be entitled to
adjourn the Closing for a period of up to thirty (30) days, by written notice to
the other party, in order to take any action of any kind required in order to
permit the Closing contemplated hereunder to occur. If the Closing Date
established pursuant to the preceding sentence is a Saturday, Sunday or legal
holiday, the Closing Date shall be the next business day thereafter. The place,
time and date provided for herein or hereafter, as may be changed by agreement
of the parties, is sometimes referred to as the "Closing" or "Closing Date." The
Closing shall be effective as of 12:01 a.m. New York time on the Closing Date.
4. CONTRIBUTOR'S PRE-CLOSING DELIVERIES. Contributor has delivered or made
available to the REIT all documents, contracts, information, Rent Rolls (as
defined below), Records (as defined below) and exhibits that are material to the
transaction (collectively, the "Property Documents") that is the subject of this
Agreement. "Rent Rolls" shall mean rent rolls, certified by Contributor,
indicating all tenants, spaces occupied and vacant (including the square footage
thereof), base rent, escalations, "pass-throughs" (including, but not limited
to, real estate taxes, utilities, insurance and/or other operating expenses),
additional rent, any applicable rent adjustments (such as Consumer price Index
or other adjustments), any applicable construction allowances, abatements,
concessions, security and/or other deposits. "Records" shall collectively mean
any and all books, records, tax returns, correspondence, financial data, leases,
and all other documents and matters, public or private, maintained by
Contributor or its agents, relating to receipts and expenditures pertaining to
the Property for the three most recent full calendar years and all or any
portion of the current calendar year and, to the extent they are in effect on
the Effective Date, all contracts, managing and brokerage agreements, rental
agreements, title insurance policies, surveys, tenant files, and all other
documents and matters, public or private, maintained by Contributor or its
agents, relating to ownership and operations of the Property.
5. TRANSACTION SPECIFIC CONDITIONS PRECEDENT. In addition to the conditions
precedent set forth elsewhere in this Agreement, the REIT's obligation to close
hereunder are conditioned upon the following:
(a) Cappelli Litigation. The REIT's obligation to close is
conditioned upon the settlement (as evidenced by a full release or dismissal
with prejudice by the applicable court) or other disposition, acceptable to the
REIT in it sole and absolute discretion, prior to Closing, of the litigation
commenced by Louis R. Cappelli and LRC Industries, Inc. against DKH, Inc.,
Stamford Ridgeway Associates, L.P. and Howard J. Menaker, in the
Stamford/Norwalk Judicial District, which summons had a return date of December
12, 2000, as well as any other possible ancillary litigation relating thereto
which may affect either the Property or Contributor's ability to perform its
obligations under this Agreement (collectively, the "Cappelli Litigation").
(b) Stop & Shop Claims. The REIT's obligation to close is
conditioned upon the settlement, as evidenced by a general release, or other
disposition acceptable to the REIT in its sole and absolute discretion, prior to
Closing, of all claims that the Stop & Shop Supermarket Company or its
affiliates may have with respect to Contributor, any of Contributor's Partners,
the Property, or any monies loaned or contributed to any of the foregoing
parties, as well as a waiver of any rights of first refusal or rights to
purchase the Property that Stop & Shop Supermarket Company may have under its
lease at the Property.
(c) Assumption of Existing Mortgage. Prior to the Closing,
Contributor shall have obtained the consent of the holder of the Existing
Mortgage (the "Lender") to the transfer of the Property to Acquiror and to the
assumption of the Existing Mortgage (without amendment or modification of any of
the terms of such loan) by Acquiror. Contributor shall be responsible for all
fees or expenses charged by Lender in connection with obtaining such consent.
The REIT and Acquiror agree to cooperate (at no third party or out of pocket
cost to the REIT) with Contributor in obtaining such consent. Acquiror agrees to
use its commercially reasonable efforts to deliver to the Lender those documents
contemplated in Section 5.1(b) of the Existing Mortgage to be delivered to the
Lender by a so-called Qualified Party. Contributor agrees to use its
commercially reasonable efforts to deliver to the Lender those documents
contemplated in Section 5.1(b) of the Existing Mortgage to be delivered by the
Mortgagor to the Lender.
(d) Violation of Lease Exclusives. The REIT's obligation to
close is conditioned upon the execution of lease modification agreements or
other documents acceptable to the REIT in it sole and absolute discretion, prior
to the Closing, eliminating the apparent lease violations identified on Schedule
5(d) hereto.
(e) Cives Mechanic's Lien. The REIT's obligation to close is
conditioned upon the release, prior to Closing of that certain Mechanic's Lien
in favor of Cives Steel Company, in the amount of $157,615, dated July 8, 1997,
and recorded in Volume 4800 at page 146 of the Stamford Land Records, or other
evidence reasonably satisfactory to the Title Company (defined below) confirming
that such mechanics lien is no longer valid.
(f) Release of Construction Mortgage. The REIT's obligation to
close is conditioned upon the release, prior to Closing of (1) that certain
Mortgage, from Stamford Ridgeway Associates Limited Partnership to Canadian
Imperial Bank, dated May 16, 1996, and recorded in Volume 4576 at page 22 of the
Stamford Land Records, and (2) that certain Assignment of Rents and Leases, from
Stamford Ridgeway Associates Limited Partnership to Canadian Imperial Bank,
dated May 16, 1996, and recorded in Volume 4576 at page 79 of the Stamford Land
Records.
Contributor, through the efforts of DKH, shall use its
commercially reasonable efforts to cause the conditions precedent above to be
satisfied as soon as reasonably practicable.
6. TITLE AND SURVEY MATTERS.
------------------------
(a) Conveyance of Title. At Closing, Contributor shall deliver to Acquiror a
limited warranty deed in the form of Exhibit H-1 attached hereto, in recordable
form, conveying Parcels A and B of the Land, together with the Improvements
thereon, to Acquiror, free and clear of all liens, claims and encumbrances
except for those exceptions listed on Schedule 6(a) hereto ("Permitted
Exceptions"). At Closing, Contributor shall also deliver to Acquiror a quit
claim deed in the form of Exhibit H-2 attached hereto, in recordable form,
conveying all of its interest, if any, in and to Parcel C of the Land, as
described on Exhibit A hereto. These two deeds shall collectively be referred to
herein as the "Deeds". At Closing, if requested by Acquiror, Contributor also
agrees to deliver to Acquiror a quit claim deed in the form of Exhibit H-3
attached hereto, in recordable form, conveying all of Contributor's interest, if
any, in and to the property described on Schedule A of Exhibit H-3 attached
hereto, the parties acknowledging that such a quit claim deed may be requested
for purposes of clarifying certain ambiguities that may exist in the legal
description of the Land.
(b) Title Commitment. The REIT has obtained a commitment dated February 8, 2002,
revised March 21, 2002 (Commitment No. C02-1265) (the "Title Commitment"),
issued by Lawyers Title Insurance Corporation (the "Title Company"), for an
owner's title insurance policy (the "Title Policy") with respect to the
Property, a copy of which has been delivered to Contributor. At or prior to the
Closing, Contributor shall deliver to the Title Company or the Acquiror, as the
case may be, the certificates and affidavits in the forms attached hereto as
Exhibit 6(b) .
(c) Survey. The REIT has obtained and is satisfied with an as-built survey of
the Property dated February 27, 2002 and prepared by Rocco V. D'Andrea, Inc.
(the "Survey"), and certified by said surveyor as having been prepared pursuant
to the Regulations of Connecticut State Agencies Sections 20-300b-1 through
20-300b-20 and the "Standards for Surveys and Maps in the State of Connecticut"
as adopted by the Connecticut Association of Land Surveyors, Inc. on September
26, 1996, as a Class A-2 survey.
(d) UCC Searches. The REIT has obtained and is satisfied with current searches
of all Uniform Commercial Code ("UCC") financing statements naming Contributor
as debtor, filed with the Secretary of State of Connecticut, in form and
substance satisfactory to the REIT.
7. REPRESENTATIONS AND WARRANTIES; CERTAIN COVENANTS.
-------------------------------------------------
7.1 Contributor. Contributor makes the following representations and warranties
as of the Closing Date, to the REIT and Acquiror, and covenants as follows:
(a) Title. Contributor has good and marketable title to the Land (except
Contributor makes no representations with respect to title to Parcel "C"
described on Exhibit A hereto) and Improvements and has the right to convey and
transfer all of its interests in the Land, Improvements, Personal Property (a
list of which is attached hereto as Schedule 7.1(a)), Inventory and Intangible
Personal Property to Acquiror, all subject to the Leases (as defined below) and
Permitted Exceptions.
(b) Contributor's Deliveries. All of the Property Documents and all other items
delivered by Contributor pursuant to this Agreement are true, accurate, correct
and complete in all material respects, and fairly present the information set
forth in a manner that is not misleading. To Contributor's knowledge, copies of
all documents and other agreements delivered or furnished and made available by
Contributor to the REIT pursuant to this Agreement constitute all of and the
only Leases and other agreements to which Contributor is presently a party
relating to or affecting the ownership, leasing, management and operation of the
Property, there being no "side" or other agreements, written or oral, in force
or effect, to which Contributor is a party or, to Contributor's actual
knowledge, to which the Property is subject.
(c) Defaults. To Contributor's knowledge, the Property complies with and there
are no defaults or breaches by the Contributor or the Property of any of the
covenants, conditions, restrictions, rights-of-way, or easements or other
instruments encumbering the Property or any portion thereof.
(d) Contracts. Schedule 7.1(d) contains a true, correct and complete list of all
contracts (except for Leases) effective as of the Effective Date, relating to
the management, leasing, operation, maintenance or repair of the Property or
that would otherwise affect the use, operation or enjoyment of the Property
(collectively, "Contracts"). None of the improvements used in connection with
the Shopping Center are leased except pursuant to Contracts identified on
Schedule 7.1(d). All of the Contracts, including without limitation, any
property management agreement, shall be terminated by Contributor on or before
the Closing Date and Contributor shall indemnify Acquiror against any cost or
expense that Acquiror may suffer arising out of such Contracts. Notwithstanding
the foregoing, in the event Acquiror elects to assume certain contracts which
are now in effect with respect to service, supply and maintenance at or of the
Property, such contracts (the "Assumed Contracts") shall be so identified as
Assumed Contracts on Schedule 7.1(d), and Contributor agrees to cooperate with
Acquiror, at no material cost to Contributor, in obtaining any required consents
for such an assignment and assumption of such Assumed Contracts.
(e) Physical Condition. Contributor has not sent or received any written notice,
within the last three years, relating to or alleging any existing latent
structural defect in the Property, or any component or portion thereof, that
would or could impair or impose costs in excess of $10,000 upon the use,
occupancy or operation of the Property, and that has not been fully corrected.
Contributor has no actual knowledge of any existing latent structural defect at
the Property.
(f) Employees. The parties acknowledge that Contributor currently has employees.
Contributor warrants and covenants that it will have no employees on the Closing
Date. Contributor is not a party to any collective bargaining or other agreement
or understanding with any labor union relating to the Property, and Contributor
is not privy to or involved in any labor or union controversy or other union
interaction of any kind.
(g) Compliance with Laws and Codes. Except as set forth in Schedule 7.1(g)
hereto, Contributor has not sent or received any written notice, within the last
three years, suggesting or alleging that (i) the Property is not, or the use and
operation of the Property are not in compliance with all municipal and other
governmental laws, ordinances, regulations, codes (including Environmental Laws,
as defined below), licenses, permits and authorizations (including Environmental
Permits, as defined below); or (ii) Contributor does not have validly in effect
all licenses, permits and other authorizations (including Environmental Permits
and certificates of occupancy) necessary for the use, occupancy and operation of
the Property as it is presently operated, whether required of Contributor or to
the best of Contributor's knowledge, any Tenant. Contributor has not sent or
received any written notice, within the last three years, suggesting or alleging
that any zoning, subdivision, Environmental Law, Environmental Permit, building
code, health, fire, safety or other law, order or regulation is, or on the
Closing Date will be, violated by the continued maintenance, operation or use of
the Shopping Center. Contributor covenants and agrees that it will remedy all
code violations and other matters referenced on Schedule 7.1(g) prior to the
Closing or establish reasonable reserves at Closing to pay for the costs of such
remedies if the completion of such remedies is not commercially feasible prior
to the Closing. Contributor further agrees and covenants that it will promptly
submit and use its best efforts to obtain a renewal of the General Permit to
Construct and/or Operate an Emergency Engine included as part of Schedule 7.1(g)
with the Connecticut Department of Environmental Protection. Contributor shall
be responsible for all costs, including possible penalties and fines, that may
arise or be imposed in connection with the renewal of such permit.
(h) Litigation. Except for the Cappelli Litigation, the Stop & Shop Claims
contemplated in section 5(b) hereof, and those claims against the Shopping
Center or the Contributor identified on Schedule 7.1(h) attached hereto which
are covered by comprehensive general liability insurance policies written on an
occurrence basis, Contributor has no actual knowledge of any pending or
threatened in writing judicial, municipal or administrative proceedings
affecting the Property (other than suits against tenants of the Shopping Center
which do not either name Contributor as a defendant or claim a lien against the
Property) or in which Contributor is or will be a party by reason of
Contributor's ownership or operation of the Property or any portion thereof,
including, without limitation, proceedings for or involving collections,
condemnation, eminent domain, alleged building code or environmental or zoning
violations, or personal injuries or property damage alleged to have occurred on
the Property or by reason of the condition, use of, or operations on, the
Property. No attachments, execution proceedings, assignments for the benefit of
creditors, insolvency, bankruptcy, reorganization or other proceedings are
pending or, to the best of Contributor's knowledge, threatened, against
Contributor, nor are any of such proceedings contemplated by Contributor.
(i) Insurance. Contributor now has in force casualty, liability and business
interruption insurance relating to the Property in the minimum coverages and
amounts set forth on Schedule 7.1(i). Contributor has received no written notice
from any insurance carrier and has no knowledge of any defects or inadequacies
in the Property that, if not corrected, would result in termination of insurance
coverage or increase in the present cost thereof.
(j) Re-Zoning; Zoning. Contributor has not sent or received, any written notice,
within the last three years, relating to (i) any threatened proceeding for the
re-zoning of the Property or any portion thereof, or the taking of any other
action by governmental authorities that would have a material adverse impact on
the value of the Property or use thereof, (ii) zoning violations affecting the
Property or the validity of the Certificate of Occupancy for the Property, or
(iii) proceedings pending or threatened that could or would involve the change,
redesignation, redefinition or other modification of the zoning classifications
of the Property, or any portion thereof, or any property adjacent to the
Property.
(k) Authority of Contributor. The execution and delivery of this Agreement and
the other documents delivered by Contributor, and the performance of all
obligations of Contributor under this Agreement and such other documents by
Contributor, have been duly authorized by Contributor, and this Agreement is
binding on Contributor and enforceable against Contributor in accordance with
its terms. The individuals executing this Agreement on behalf of the Contributor
each warrant and represent to the REIT that such individuals are duly authorized
on behalf of all of Contributor's Partners and have the right to enter into this
Agreement on behalf of Contributor. No consent of any creditor of or investor in
Contributor, judicial or administrative body, Governmental Authority, or other
governmental body or agency, or other party to such execution, delivery and
performance by Contributor is required. Neither the execution of this Agreement
nor the consummation of the transactions contemplated hereby by Contributor will
(i) result in a breach of, default under, or acceleration of, any agreement to
which Contributor is a party or by which Contributor or the Property is bound;
or (ii) violate any restriction, court order, agreement or other legal
obligation to which Contributor and/or the Property are subject.
(l) Real Estate Taxes. To the Contributor's knowledge, no special taxes or
assessments have been levied, assessed or imposed on or against the Property or
any part thereof that have not been fully and finally paid or funds escrowed
therefor, and neither the Contributor, nor to the Contributor's knowledge, any
of its agents or employees have received any notice of contemplated, threatened
or pending special taxes or assessments affecting the Property or any part
thereof. Contributor represents that it has not instituted, and will not prior
to the Closing Date institute, any proceeding or application for a reduction in
the real estate tax assessment of the Property or any other relief for any tax
year. If Contributor receives any payment of a rebate of taxes in its favor,
Contributor will remit to any Tenant all or any portion of such rebated sums
which is owed to such Tenant. There are no outstanding agreements with attorneys
or consultants to which Contributor or an authorized agent of Contributor is a
party with respect to the Tax Bills that will bind Acquiror or the Property
after the Closing.
(m) Taxes. Contributor has prepared and filed all tax returns required to be
filed by it. Contributor has paid or made provision for the payment of all taxes
that are due or claimed in writing to be due from it on or before the date
hereof by any governmental taxing authority. No federal, state, local or foreign
taxing authority has asserted in writing any tax deficiency, lien, interest or
penalty or other assessment against the Property or Contributor which has not
been paid and there is no pending audit or inquiry from any federal, state,
local or foreign tax authority relating to the Property or Contributor which may
be expected to result in a tax deficiency, lien, interest, penalty or other
assessment against the Property.
(n) Easements and Other Agreements. Contributor has not received any written
notice (that remains outstanding) alleging that it is in default in complying
with the terms and provisions of any of the covenants, conditions, restrictions,
rights-of-way or easements constituting one or more of the Permitted Exceptions.
(o) [intentionally deleted]
-----------------------
(p) FIRPTA. Contributor is not a "Foreign Person" within the meaning of Section
1445(f)(3) of the Code.
(q) Existing Mortgage. There is no default under, nor, to the best of
Contributor's knowledge, has there occurred any event which, with the giving of
notice and/or the passage of time, or both, would constitute a default under,
the Existing Mortgage, the promissory note (the "Existing Note") evidencing the
loan (the "Existing Loan") secured by the Existing Mortgage, or the other
documents securing the Existing Note (collectively, the "Existing Loan
Documents"). Contributor has delivered to Acquiror or the REIT a copy of all of
the Existing Loan Documents, a true, correct and complete list of which is set
forth in Schedule 7.1(q). Contributor has paid all sums due under the Existing
Loan Documents.
(r) Condemnation. Contributor has received no written notice of any pending or
contemplated condemnation or other governmental eminent domain proceedings
affecting all or any part of the Property.
(s) Disclosure. No representation or warranty made by Contributor in this
Agreement contains any untrue statement of a material fact, or omits to state a
material fact necessary in order to make the statements contained therein not
misleading.
(t) Organization and Ownership. Contributor is a limited partnership, duly
formed and in existence under the laws of Connecticut.
The representations and warranties in this Agreement by
Contributor will be true, correct and complete on the Closing Date. The
representations and warranties in Subparagraph 7.1(m) and the obligations of
Contributor set forth in paragraph (e) of Section 2, Subparagraph 8(b),
Subparagraph 13(g), Sections 17, 21, 23 and 24, and Subparagraph 25(a)(iii) of
this Agreement that are to be performed by Contributor following the Closing
shall survive the Closing until they are fully performed, or until the
expiration of any applicable statute of limitations, as the case may be. Except
as provided in the two immediately preceding sentences and in the next five
sentences, all other representations, warranties and covenants made in this
Agreement by Contributor (including those in Section 9 hereof) shall survive the
Closing for a period ending December 31, 2002, and shall not merge into any
instrument of conveyance delivered at the Closing. Contributor's indemnification
obligations under this Agreement with respect to any representation, warranty or
covenant of Contributor contained herein shall be subject to Contributor's
receipt of specific written notice of a breach or claim or potential breach or
claim with respect to such representation, warranty or covenant during the
survival period of the underlying representation, warranty or covenant to which
it relates. Notwithstanding the preceding sentence, the representations and
warranties set forth in Subparagraphs 7.1(a), (c), (k), (p) and (t) shall not
survive the Closing. If the REIT receives an Estoppel Certificate (as
hereinafter defined) from a Tenant that addresses and confirms, with respect to
that Tenant's Lease, those matters in Subparagraph 11(a), the REIT shall rely on
such Estoppel Certificate in lieu of those representations and warranties of
Contributor in Subparagraph 11(a), but only if and to the extent that
Contributor's representations and warranties in Subparagraph 11(a) are actually
and specifically addressed and confirmed by the Estoppel Certificate. If the
REIT receives an estoppel certificate from the Lender that addresses and
confirms those matters in Subparagraphs 7.1(q) and 8(e), the REIT shall rely on
such estoppel certificate in lieu of those representations and warranties of
Contributor in Subparagraphs 7.1(q) and 8(e), but only if and to the extent that
Contributor's representations and warranties in Subparagraphs 7.1(q) and 8(e)
are actually and specifically addressed and confirmed by such estoppel
certificate. The representations and warranties of Contributor in Subparagraph
11(a) shall expire as of the Closing Date, but only with respect to those
Tenants, and their respective Leases from which the REIT receives an Estoppel
Certificate that actually and specifically addresses and confirms those matters
that are the subject of Subparagraph 11(a). If, prior to the Closing, the REIT
acquired actual knowledge, through any written documentation copies of which
were delivered to or made available by Contributor to the REIT, of the breach of
any of Contributor's representations and warranties, and the REIT nonetheless
elects to close under this Agreement, then the REIT shall be deemed to have
waived the breach in question. This Section shall not limit in any way the
survival and enforceability of any covenant or agreement of the parties hereto
whether in this Section 7.1 or otherwise herein which by its terms contemplates
performance after the Closing Date, which shall survive indefinitely or for the
respective periods set forth herein, if any. Whenever a representation or
warranty is made in this Agreement on the basis of the knowledge or actual
knowledge of Contributor, such representation and warranty is made on the basis
of the current actual knowledge of Michael Levy, Clifford Schwartz, Howard
Menaker or Chi Chu.
7.2 The REIT. The REIT makes the following representations and warranties as of
the Closing Date, to Contributor:
(a) Existence and Power. The REIT is a corporation duly organized, validly
existing and in good standing under the laws of the State of Maryland, and is
duly qualified to do business in all jurisdictions where such qualification is
necessary to carry on its business, except where the failure to so qualify would
not materially and adversely affect the financial condition, business or
operations of the REIT.
(b) Notice of Violations. The REIT has received no written notice of any
existing violation of any federal, state, county or municipal law, ordinance,
order, code, regulation or requirement affecting the REIT or any of its assets
that would have a material adverse effect on the financial condition or business
of the REIT.
(c) REIT Qualification. The REIT is organized and operates as a "real estate
investment trust" under Sections 856 through 860 of the Code. The REIT has
elected to be taxed as a "real estate investment trust" under the Code.
(d) Authorization. The REIT is the sole general partner of Acquiror, and has all
requisite corporate power and authority to cause Acquiror to acquire the
Property and perform any of its other obligations contemplated hereunder. The
execution and delivery to Contributor of all agreements and other documents the
REIT executes and delivers in connection with the transactions described in this
Agreement (the "REIT Documents"), and performance by the REIT under the REIT
Documents and of its other obligations arising out of this Agreement, if any,
have been duly authorized by all requisite corporate action. The REIT Documents
are binding on the REIT and enforceable against the REIT in accordance with
their terms, subject to bankruptcy and similar laws affecting the remedies or
recourse of creditors generally and general principles of equity. Neither the
execution of this Agreement nor the consummation of the transactions
contemplated hereby by the REIT will (i) result in a breach of, default under,
or acceleration of, any agreement to which the REIT is a party or by which the
REIT is bound; or (ii) violate any restriction, court order, agreement or other
legal obligation to which the REIT is subject, except where such breach or
violation would not have a material adverse effect on its financial condition or
business.
(e) Pending Actions. There is no existing or, to the REIT's knowledge,
threatened legal action or governmental proceedings of any kind involving the
REIT, any of its assets or the operation of any of the foregoing, which, if
determined adversely to the REIT, could reasonably be expected to have a
material adverse effect on the financial condition or business of the REIT.
(f) Accreditation status of DKH. DKH has delivered to the REIT and to counsel
for the REIT, completed questionnaire and representation letters in
substantially the form requested by Acquiror (the "Investor Materials")
providing, among other things, information concerning such DKH's status as an
accredited investor ("Accredited Investor"), as such term is defined in
Regulation D promulgated under the Securities Act of 1933, as amended (the
"Securities Act"), and has provided or caused to be provided to the REIT, or to
counsel for the REIT, such other information and documentation as has reasonably
been requested by the REIT in furtherance of the Acquiror's issuance of the LP
Units as contemplated hereby. Counsel for the REIT has not, after review of such
material, determined that DKH is not an Accredited Investor so that the proposed
issuance of LP Units hereunder might not qualify for the exemption from
registration provided by Section 4(2) of the Securities Act or Regulation D
promulgated thereunder, or the proposed issuance of LP Units hereunder would
violate any applicable federal or state securities laws, rules or regulations,
or any agreement to which the REIT is a party, or any tax related or other legal
rules, agreements or constraints applicable to Acquiror or the REIT.
(g) Availability of Records, etc. The REIT has inspected the Property, including
tenant files, and has received, or had an opportunity to review and examine, all
the Property Documents.
(h) Disclosure. No representation or warranty made by the REIT in this Agreement
contains any untrue statement of a material fact, or omits to state a material
fact necessary in order to make the statements contained therein not misleading.
All representations and warranties made in this Paragraph 7.2
by the REIT and on behalf of the Acquiror shall survive the Closing for a period
ending December 31, 2002, and shall not merge into any instrument of conveyance
delivered at the Closing. The obligations of REIT set forth in Subparagraph
13(g), and Sections 17, 21, 23 and 24 of this Agreement that are to be performed
by the REIT following the Closing shall survive the Closing until they are fully
performed, or until the expiration of any applicable statute of limitations, as
the case may be. If, prior to the Closing, the Contributor acquired actual
knowledge, through any written documentation copies of which were delivered to
the Contributor, of the breach of any of REIT's or Acquiror's representations
and warranties, and the Contributor nonetheless elects to close under this
Agreement, then the Contributor shall be deemed to have waived the breach in
question. This Section shall not limit in any way the survival and
enforceability of any covenant or agreement of the parties hereto whether in
this Section 7.2 or otherwise herein which by its terms contemplates performance
after the Closing Date, which shall survive indefinitely or for the respective
periods set forth herein, if any. In this Agreement with respect to any
representation or warranty, the "knowledge" of the REIT refers to the current
actual knowledge of Charles J. Urstadt, Willing L. Biddle, James R. Moore and
Raymond P. Argila.
7.3 Acquiror. Acquiror makes the following representations and warranties as of
the Closing Date, to Contributor:
(a) Existence and Power. The Acquiror is a limited partnership duly organized
and validly existing under the laws of the State of Delaware; has all requisite
power necessary to own its assets and carry on its business as now being or as
proposed to be conducted; will be qualified on the Closing Date to do business
in all jurisdictions in which the nature of the business conducted by it makes
such qualification necessary, except where the failure to be so qualified would
not have a material adverse effect on its financial condition or business; and
has all requisite partnership power and authority under its Partnership
Agreement to execute and deliver all documents and instruments to be executed
and delivered by it hereunder and to perform its obligations hereunder and
thereunder in accordance with the terms and conditions hereof and thereof.
(b) Notice of Violations. Acquiror has received no written notice of any
existing violation of any federal, state, county or municipal law, ordinance,
order, code, regulation or requirement affecting Acquiror or any of its assets
that would have a material adverse effect on the financial condition or business
of the Acquiror.
(c) Authorization. The Acquiror has all requisite partnership power and
authority to acquire the Property and perform any of its other obligations
contemplated hereunder. The execution and delivery to Contributor of all
agreements and other documents Acquiror executes and delivers in connection with
the transactions described in this Agreement (the "Acquiror Documents"), and
performance by Acquiror under the Acquiror Documents and of its other
obligations arising out of this Agreement, if any, have been duly authorized by
all requisite partnership action. The Acquiror Documents are binding on Acquiror
and enforceable against Acquiror in accordance with their terms, subject to
bankruptcy and similar laws affecting the remedies or recourse of creditors
generally and general principles of equity. Neither the execution of this
Agreement nor the consummation of the transactions contemplated hereby by
Acquiror will (i) result in a breach of, default under, or acceleration of, any
agreement to which Acquiror is a party or by which Acquiror is bound; or (ii)
violate any restriction, court order, agreement or other legal obligation to
which Acquiror is subject, except where such breach or violation would not have
a material adverse effect on its financial condition or business.
(d) Pending Actions. There is no existing or, to Acquiror's knowledge,
threatened legal action or governmental proceedings of any kind involving
Acquiror, any of its assets or the operation of any of the foregoing, which, if
determined adversely to Acquiror, could reasonably be expected to have a
material adverse effect on the financial condition or business of Acquiror.
(e) Accreditation status of DKH. DKH has delivered to Acquiror and to counsel
for Acquiror, completed questionnaire and representation letters in
substantially the form requested by Acquiror (the "Investor Materials")
providing, among other things, information concerning such DKH's status as an
Accredited Investor, and has provided or caused to be provided to Acquiror, or
to counsel for Acquiror, such other information and documentation as has
reasonably been requested by Acquiror in furtherance of the Acquiror's issuance
of the LP Units as contemplated hereby. Counsel for Acquiror has not, after
review of such material, determined that DKH is not an Accredited Investor so
that the proposed issuance of LP Units hereunder might not qualify for the
exemption from registration provided by Section 4(2) of the Securities Act or
Regulation D promulgated thereunder, or the proposed issuance of LP Units
hereunder would violate any applicable federal or state securities laws, rules
or regulations, or any agreement to which Acquiror is a party, or any tax
related or other legal rules, agreements or constraints applicable to Acquiror.
(f) Availability of Records, etc. Acquiror has inspected the Property, and has
received, or had an opportunity to review and examine, all the Property
Documents.
(g) Disclosure. No representation or warranty made by Acquiror in this Agreement
contains any untrue statement of a material fact, or omits to state a material
fact necessary in order to make the statements contained therein not misleading.
All representations and warranties made in this Paragraph 7.3
by Acquiror shall survive the Closing for a period ending December 31, 2002, and
shall not merge into any instrument of conveyance delivered at the Closing. The
obligations of Acquiror set forth in Subparagraph 8(e), Subparagraph 13(g), and
Sections 17, 21, 23 and 24 of this Agreement that are to be performed by
Acquiror following the Closing shall survive the Closing until they are fully
performed, or until the expiration of any applicable statute of limitations, as
the case may be. If, prior to the Closing, the Contributor acquired actual
knowledge, through any written documentation copies of which were delivered to
the Contributor, of the breach of any of Acquiror's representations and
warranties, and the Contributor nonetheless elects to close under this
Agreement, then the Contributor shall be deemed to have waived the breach in
question. This Section shall not limit in any way the survival and
enforceability of any covenant or agreement of the parties hereto whether in
this Section 7.3 or otherwise herein which by its terms contemplates performance
after the Closing Date, which shall survive indefinitely or for the respective
periods set forth herein, if any. In this Agreement with respect to any
representation or warranty, the "knowledge" of Acquiror refers to the current
actual knowledge of Charles J. Urstadt, Willing L. Biddle, James R. Moore and
Raymond P. Argila.
8. ADDITIONAL COVENANTS .
---------------------
(a) Assignment of Escrows and Reserves. Contributor hereby covenants with the
REIT that at Closing, Contributor agrees to assign to Acquiror all of its right
title and interest in and to all amounts held on its behalf in escrows or
reserves (collectively, "Lender's Reserves") by or on behalf of the Lender,
including, without limitation, all reserves or escrows for property taxes and
the tenant improvement escrow of approximately $580,000 being held pursuant to
the terms of that certain letter agreement, dated as of December 4, 1997, by and
between Contributor and Ridgeway Funding Company, Inc. Contributor shall receive
a credit in the amount held in such reserves and escrows assigned to Acquiror,
in accordance with the provisions of Section 13 of this Agreement.
(b) Pre-Closing Expenses. Contributor hereby covenants with the REIT that
Contributor has paid in full, prior to Closing or will pay or adjust at Closing
(or the same shall be subject to re-proration after the Closing if the bill or
invoice is not issued by Closing), all bills and invoices for labor, goods,
material and services of any kind relating to the Property and utility charges
relating to the period prior to Closing, but excluding therefrom all utility and
other charges billed directly to Tenants or subtenants of the Property. Except
as expressly provided herein, any alterations, installations, decorations and
other work performed by Contributor prior to the Closing under any and all
agreements affecting the Property have been, by the Closing, completed and paid
for in full. Acquiror will not assume any liabilities of either Contributor or
the Property which accrue or arise prior to the Closing Date, other than the
Permitted Exceptions. This Subparagraph 8(b) shall survive Closing.
(c) Good Faith. Each of the parties covenant to each other that such party has
taken or will take all actions required pursuant to this Agreement necessary to
effectuate the transactions contemplated herein, and will furnish each other
with such documents or further assurances as the other party may reasonably
require in connection therewith, without cost to such party and consistent with
this Agreement.
(d) Availability of Records. Contributor hereby covenants with the REIT that,
upon the REIT's request, for a period of three years after Closing, Contributor
shall (i) make the books and records of the Contributor relating to the Property
available to the REIT or Acquiror, as the case may be, for inspection, copying
and audit by the REIT's or Acquiror's designated accountants; and (ii) cooperate
with the REIT or Acquiror, as the case may be (without any out of pocket cost or
third-party expense to Contributor), in obtaining any and all permits, licenses,
authorizations, and other Governmental Approvals necessary for the operation of
the Property. Contributor acknowledges that applicable securities laws may
require the REIT to file audited financial statements relating to operations at
the Property for a three year period, and hereby consent to the REIT engaging
the Contributor's auditors to assist the REIT in the preparation of all or a
portion of such audited financial information relating to property operations,
and to otherwise cooperate (at no cost to the Contributor) with the REIT and
Acquiror in preparing such financial statements.
(e) Existing Mortgage. Contributor agrees that Acquiror shall only be
responsible for (i) the principal amount of the Existing Mortgage outstanding on
the Closing Date; (ii) the payment of principal and interest on the Existing
Mortgage due after the Closing Date; and (iii) and all other obligations of and
under the Existing Mortgage arising out of events occurring on and after the
Closing Date. The parties acknowledge that neither the REIT nor the Acquiror
shall have any responsibility for any of the agreements, covenants, obligations
or undertakings contemplated under (x) that certain Master Lease, dated December
4, 1997, between Stamford Ridgeway Associates Limited Partnership, as landlord,
and Stamford Ridgeway Associates Limited Partnership, as tenant, or (y) that
certain Lease Indemnity Agreement, dated December 4, 1997, between Stamford
Ridgeway Associates Limited Partnership, Stamford Ridgeway Corporation, DKH,
Inc. and Ridgeway Funding Company, Inc. This Subparagraph 8(e) shall survive
Closing.
(f) Existing Management Agreement. Contributor hereby covenants with the REIT
that on or prior to the Closing Date, Contributor shall have terminated the
Management Agreement dated May, 1996, by and between Contributor and Silverstein
Properties, Inc. (the "Management Agreement") and shall pay on or prior to
Closing all fees or charges, if any, payable to the managing agent associated
with the termination of the Management Agreement. From and after the Closing
Date, Contributor shall be and continue to be solely responsible for all fees,
commissions, expenses and other charges payable in connection with the
Management Agreement.
9. ENVIRONMENTAL WARRANTIES AND AGREEMENTS.
---------------------------------------
(a) Definitions. Unless the context otherwise requires:
-----------
(i) "Environmental Law" or "Environmental Laws" shall mean applicable past,
present or future federal, state and local statutes, regulations, directives,
ordinances, rules, guidelines, court orders, judicial or administrative decrees,
arbitration awards and the common law, which pertain to the environment, soil,
water, air, flora and fauna, or health and safety matters, as such have been
amended, modified or supplemented from time to time (including all present and
future amendments thereto and reauthorizations thereof). Environmental Laws
include, without limitation, those relating to: (i) the manufacture, processing,
use, distribution, treatment, storage, disposal, generation or transportation of
Hazardous Materials; (ii) air, soil, surface, subsurface, groundwater or noise
pollution; (iii) releases of Hazardous Materials; (iv) protection of endangered
species, wetlands or natural resources; (v) the operation and closure of
containers; (vi) health and safety of employees and other persons; and (vii)
notification and reporting requirements relating to the foregoing.
(ii) "Environmental Permit" or "Environmental Permits" shall mean licenses,
certificates, permits, directives, requirements, registrations, government
approvals, agreements, authorizations, and consents which are required under or
are issued pursuant to an Environmental Law or are otherwise required by
governmental authorities or agencies.
(iii) "Hazardous Condition" or "Hazardous Conditions" refers to the existence or
presence of any Hazardous Materials on, in, under, at, near or about the
Property or any portion of it (including air, soil and groundwater).
(iv) "Hazardous Material" or "Hazardous Materials" shall mean any chemical,
pollutant, contaminant, pesticide, petroleum or petroleum product or by-product,
radioactive substance, hazardous or extremely hazardous solid waste, special,
dangerous or toxic waste, substance, chemical or material, now or hereafter,
regulated, listed, limited or prohibited, or defined as a hazardous waste or
hazardous substance, pollutant or contaminant, under any Environmental Law.
(b) Representations and Warranties. Contributor represents and warrants to the
REIT and Acquiror that, except as set forth in Schedule 9(b) hereto:
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(i) Except as set forth in the reports identified on Schedule 9(b), Contributor
has not sent or received within the past three (3) years any written notice
which relates to or alleges (a) any violation or alleged violation of any
Environmental Law or Environmental Permit or with respect to any corrective or
remedial action for or cleanup of the Property or any portion of it; or (b) any
actual, potential or alleged liability or obligation under or violation of any
Environmental Law or Environmental Permit with respect to the Property or any
portion of it, which has not been remedied or withdrawn;
(ii) Except as set forth in the reports identified on Schedule 9(b), Contributor
has not sent or received in the past three (3) years any written notice which
relates to or alleges that there has been a release, remittance, discharge,
leaching, dumping or disposing of a Hazardous Material at the Property, which
has not been remedied or withdrawn; and
(iii) Contributor has no actual knowledge of any condition at the Property not
identified in that certain Phase I Environmental Site Assessment Report for the
Ridgeway Center, dated February 26, 2002 (the "Report"), prepared by Pressly and
Associates, Inc. for the REIT, that would make the Report materially untrue,
misleading or incomplete.
10. ADDITIONAL CONDITIONS PRECEDENT TO CLOSING.
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In addition to the other conditions precedent in this Agreement, the following
shall be additional REIT's Conditions Precedent:
(a) Pending Actions. At Closing, there shall be no administrative agency,
litigation or governmental proceeding of any kind whatsoever, pending or
threatened in writing, that, after Closing, would materially and adversely
affect the value or marketability of the Property or the ability of Acquiror to
operate the Property in the manner it is being operated on the Closing Date.
(b) Utilities. On the Closing Date, no moratorium or proceeding shall be pending
or threatened in writing affecting the availability, at regular rates and
connection fees, of sewer, water, electric, gas, telephone or other services or
utilities servicing the Property.
(c) Bankruptcy. As of the Closing Date, neither Contributor nor the Property is
the subject of any bankruptcy proceeding for which approval of this transaction
has not been given and issued by the applicable bankruptcy court.
(d) Covenants Performed. All covenants of Contributor required to be performed
prior to the Closing Date shall have been performed in all material respects.
(e) Title to the Property. Title to the Property shall be in the condition
required under Paragraph 6.
(f) Partnership Consents. Contributor has obtained, to the extent required in
the Contributor's partnership agreement, other operative agreements to which
Contributor is a party, and/or under applicable law, the requisite consent or
approval of the requisite percentage of the Contributor's general and limited
partners to the transactions contemplated in this Agreement.
(g) Continued Accuracy of Representations, etc.. All representations and
warranties of the Contributor set forth in this Agreement (regardless of whether
such representations and warranties are to be effective only as of the Closing
Date) shall be true and correct in all material respects as of the Closing. In
the event that any updating of a schedule or document to be delivered at the
Closing (e.g., rent roll) causes a representation or warranty of Contributor set
forth in this Agreement to become untrue or incorrect in any material fashion
from the information set forth on such schedule or document on the Effective
Date (other than with respect to the Excluded Tenants (defined below) or The
Casual Male, Inc.), this condition precedent shall be deemed not to have been
satisfied.
(h) Title Policy. Receipt of the Title Policy (or "marked-up" title commitment)
issued by the Title Company, in form and substance consistent with the Title
Commitment, dated as of the Closing Date, with such endorsements and otherwise
in accordance with Paragraph 6.
11. LEASES CONDITIONS PRECEDENT AND REPRESENTATIONS WITH RESPECT THERETO.
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(a) Representations as to Leases. Set forth on Schedule 11(a) is a list of all
leases, licenses or other occupancy agreements relating to or affecting the
Property, and all modifications, extensions and amendments thereto (the
"Leases"). Contributor has delivered true, correct and complete copies of all
Leases. With respect to each tenant listed on the Rent Roll provided to the REIT
by Contributor (collectively, the "Tenants"), Contributor represents and
warrants to the REIT as follows:
(i) Except as otherwise specifically disclosed on the Rent Roll, as updated at
Closing, or on either Schedule 11(a) or Schedule 11(a)(i) as updated at Closing,
each Lease is in full force and effect according to the terms thereof and in the
Rent Roll, and has not been modified, amended, or altered;
(ii) Except as set forth on Schedule 11(a)(ii), and subject to Paragraph 23, all
obligations of the lessor under the Leases that accrue on or prior to the date
of Closing have been performed, including, but not limited to, all required
tenant improvements, cash or other inducements, rent abatements or moratoria,
installations and construction (for which payment in full has been made or will
be made prior to Closing);
(iii) Except as otherwise specifically disclosed on the Rent Roll as updated at
Closing, Schedule 13(g) as updated at Closing, or on Schedule 11(a)(iii) as
updated at Closing, no Tenant is currently in default under or is in arrears in
the payment of any sums or in the performance of any obligations required of it
under its Lease;
(iv) Contributor has not received any notice within the last three years from
any Tenant stating that a petition in bankruptcy has been filed by or against
it, other than in respect of the tenant The Casual Male, Inc.;
(v) Except with respect to security deposits, neither base rent ("Base Rent"),
nor regularly payable estimated Tenant contributions or operating expenses,
insurance premiums, real estate taxes, common area charges, and similar or other
"pass through" or non-base rent items including, without limitation,
cost-of-living or so-called "C.P.I." or other such adjustments (collectively,
"Additional Rent"), nor any other material item payable by any Tenant under any
Lease has been heretofore prepaid for more than one month following the Closing;
(vi) To the best of Contributor's knowledge, no guarantor(s) of any Lease has
been released or discharged, partially or fully, voluntarily or involuntarily,
or by operation of law, from any obligation under or in connection with any
Lease or any transaction related thereto;
(vii) Subject to Paragraphs 21 and 23, there are no brokers' commissions,
finders' fees, or other charges payable or to become payable to any third party
on behalf of Contributor in connection with any Lease, including, but not
limited to, any option(s) to expand or renew.
(viii) Except as set forth on Schedule 11(a)(viii), no Tenant has on deposit
with Contributor any security deposit. Each security deposit set forth on
Schedule 11(a)(viii) shall be transferred to Acquiror at the Closing (or the
REIT shall receive a credit therefor). Contributor agrees and covenants that it
will not offset against any security deposit held by it as of the Effective Date
without the consent of Acquiror. In the event Contributor does set off any
security deposit without the consent of Acquiror, the REIT and Acquiror shall be
permitted to terminate this Agreement and to receive back the Earnest Money and
all interest accrued thereon;
(ix) Except as set forth in Schedule 11(a)(ix), Contributor shall have paid (or
the REIT shall receive a credit therefor), and Contributor shall have retained
sole and exclusive responsibility for, all expenses connected with or arising
out of the negotiation, execution and delivery of the Leases, including, without
limitation, brokers' commissions (including those applicable, if any, to future
expansions or renewals by a Tenant), leasing fees and recording fees (as well as
the cost of all tenant improvements not required to be paid for by Tenants);
(x) Except as otherwise expressly disclosed on the Rent Roll or on Schedule
11(a), to the best of Contributor's knowledge, as of the Closing Date: (A) no
Tenant has sublet its leased premises; (B) no assignment of any interest in a
Lease has been made by any Tenant; and (C) there are no outstanding written
requests from any Tenants to Contributor, requesting any consent to an
assignment of the Tenant's Lease or to a sublease of all or some portion of a
Tenant's leased premises.
(xi) Although the Trans-Lux Notice of Lease (as defined on Schedule 6(a)) and
the Helene's Restaurants Notice of Lease (as defined on Schedule 6(a)) appear as
permitted exceptions on Schedule 6(a) to this Agreement, Contributor represents
and warrants that each of the leases referenced in such Notices of Lease have
expired and that the tenants under such leases have no rights to the space
formerly occupied by them pursuant to the terms of said leases.
(b) Estoppel Certificates and Subordination Agreements from Tenants. Contributor
shall deliver to the REIT, on or prior to the Closing Date, tenant's estoppel
certificates (each an "Estoppel Certificate") from the Tenants dated no earlier
than 30 days prior to the Closing Date (unless such Estoppel Certificate is
dated more than thirty days prior to the Closing and is dated on or after
February 22, 2002 and Contributor represents at Closing, with such
representation surviving Closing for a period ending December 31, 2002, that it
has no knowledge of any changed circumstances that would make such estoppel
untrue in any material manner) and no later than the Closing Date as follows:
Each such Estoppel Certificate shall be substantially in the form of Exhibit G.
Contributor shall obtain and deliver to the REIT, at Closing, Estoppel
Certificates for (i) those particular Tenants reflected on Schedule 11(b)
("Required Estoppel Tenants") and (ii) from such additional Tenants as are
responsible for 70% of (x) the total aggregate rentable square footage of the
Property (as shown on the Rent Roll delivered at Closing), minus (y) the
aggregate rentable square footage of the Required Estoppel Tenants, and minus
(z) the aggregate rentable square footage attributable to leases with Yogurt &
Such Long Island, Inc. and The Station Home Furnishing Store, LLC (the "Excluded
Tenants"). If Contributor satisfies the above requirement, but (despite its good
faith and diligent efforts) has been unable to obtain all of the remaining
Estoppel Certificate(s) from any Tenants (other than the Excluded Tenants), then
Contributor's representations set forth in this Agreement with respect to the
leases of such Tenant(s) shall survive the Closing, subject to the terms of the
last paragraph of Section 7.1 hereof.
12. CLOSING DELIVERIES.
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12.1 Contributor. It shall be a REIT's Condition Precedent that at Closing (or
such other times as may be specified below), Contributor shall deliver or cause
to be delivered to the REIT and/or Acquiror, as required herein, the following,
each in form and substance reasonably acceptable to the REIT and its counsel:
(a) Deeds. The Deeds, duly executed by Contributor, in the form of Exhibits H-1
and H-2, and if requested by Acquiror, in the form of Exhibit H-3;
(b) Bill of Sale. The Bill of Sale, duly executed by Contributor, in the form of
Exhibit I;
(c) General Assignment. The assignment, duly executed by Contributor, in the
form of Exhibit J;
(d) Assignment of Contracts. An assignment, duly executed by Contributor, in the
form of Exhibit K, to Acquiror with regard to those Contracts that Acquiror
elects to assume and which will remain in effect after Closing (the "Assigned
Contracts");
(e) Assignment of Leases. An assignment of Contributor's right, title and
interest in and to the Leases (including all security deposits and/or other
deposits held thereunder, except to the extent an appropriate credit is given to
the REIT at Closing), in the form of Exhibit L;
(f) Assignment of Lender's Reserves. An assignment of Contributor's right, title
and interest in and to Lender's Reserves, substantially in the form of Exhibit M
hereto;
(g) Keys. Keys to all locks located at the Property in Contributor's possession
or control;
(h) Affidavit of Title. The certificates and affidavits attached hereto as
Exhibit 6(b), each executed by Contributor;
(i) Letters to Tenants. Letters executed by Contributor and, if applicable, its
management agent, addressed to all Tenants, in form approved by the REIT (the
"Tenant Letters"), notifying all Tenants of the transfer of ownership and
directing payment of all rents accruing after the Closing Date to be made to
Acquiror or at its direction;
(j) Original Documents. To the extent not previously delivered to the REIT,
originals, to the extent in the possession of the Contributor or its managing
agent, of the Leases, Assigned Contracts and Governmental Approvals;
(k) Closing Statement. A closing statement conforming to the proration and other
relevant provisions of this Agreement (a "Closing Statement"), duly executed by
Contributor;
(l) Plans and Specifications. To the extent not previously delivered to the
REIT, to the extent in the possession of the Contributor or its managing agent,
all plans and specifications in Contributor's possession and control or
otherwise available to Contributor relating to the Property;
(m) Rent Roll. A Rent Roll (together with an updated Schedule 11(a)(iii) and
Schedule 13(g) showing rent arrearages and current defaults), prepared as of the
Closing Date, certified by Contributor to be true, complete and correct as of
the Closing Date;
(n) FIRPTA Affidavit. Contributor's affidavit confirming that Contributor is not
a "Foreign Person" within the meaning of Section 1445(f)(3) of the Code,
substantially in the form of Exhibit N hereto;
(o) Contributor's Certificate. A certificate, dated as of the Closing Date,
executed by Contributor certifying that the representations and warranties made
by Contributor in this Agreement are materially true and correct as of the
Closing Date, and if not, setting forth the changes, substantially in the form
of Exhibit O-1 hereto;
(p) Estoppel Certificates. Original Tenant Estoppel Certificates;
(q) Conveyance Tax Return and Checks. Duly completed and executed conveyance tax
forms, together with checks to the order of the appropriate governmental
authorities in amounts sufficient to pay the real estate conveyance taxes
payable upon the recording of the Deeds;
(r) Good Standing Certificate. A copy of the Certificate of Existence for
Contributor from the Secretary of the State of Connecticut;
(s) Authorization. The appropriate documentation evidencing Contributor's
organizational power and authority to enter into this Agreement (and the
transactions contemplated hereby), which documents shall be in a form reasonably
satisfactory to the REIT and its counsel;
(t) Prorations and Adjustments. To the extent applicable, an amount in cash
equal to the net amount payable in respect of any Prorations or Adjustments;
(u) Lender's Consent. A written consent from Lender to the transfer of the
Property from Contributor to Acquiror and the assumption of the Existing
Mortgage by Acquiror.
(v) Lender's Estoppel Certificate. A Lender's Estoppel Certificate,
substantially in the form appended hereto as Exhibit B.
(w) Earnest Money. Contributor shall instruct the Escrowee to apply and credit
the Earnest Money against the portion of the Contribution Consideration payable
in cash to Contributor's Partners, with any balance returned to the REIT.
(x) Other. Such other documents and instruments as may reasonably be required by
the REIT, its counsel or the Title Company and that may be necessary to
consummate the transaction that is the subject of this Agreement and to
otherwise effect the agreements of the parties hereto, without cost or
additional liability to Contributor, and consistent with this Agreement.
12.2 The REIT or Acquiror. At Closing (or such other times as may be specified
below) the REIT or Acquiror, as the case may be, shall deliver or cause to be
delivered to Contributor the following:
(a) Assignment and Assumption of Contracts. An Assignment and Assumption of the
Assumed Contracts in the form of Exhibit K hereto, duly executed by Acquiror;
(b) Assignment and Assumption of Leases. An assignment and assumption of leases
in the form of Exhibit L hereto, duly executed by Acquiror;
(c) Contract Notices. Notices to parties to Assumed Contracts which are being
assigned pursuant to the Assignment and Assumption of Contracts, duly executed
by Acquiror;
(d) Closing Statement. A Closing Statement, duly executed by the Acquiror;
(e) REIT's and Acquiror's Certificate. Certificates, dated as of the Closing
Date, executed by the REIT and Acquiror, certifying that their respective
representations and warranties made in this Agreement are materially true and
correct on the Closing Date, and if not, setting forth the changes,
substantially in the form of Exhibit O-2;
(f) Prorations and Adjustments. To the extent applicable, an amount in cash
equal to the net amount payable in respect of any Prorations or Adjustments;
(g) Assumption of Existing Mortgage. The assumption of Existing Mortgage, duly
executed by Acquiror; and
(h) Other. Such other documents and instruments as may reasonably be required by
Contributor or its counsel or the Title Company or the Lender, and that are
necessary to consummate the transaction which is the subject of this Agreement
in accordance with this Agreement and to otherwise effect the agreements of the
parties hereto, without cost or additional liability to the REIT or Acquiror,
and consistent with this Agreement.
After Closing, each of the REIT, Acquiror and Contributor
shall execute and deliver to the other such further documents and instruments as
the other reasonably requests to effect this transaction and otherwise effect
the agreements of the parties hereto, without cost or increased liability and
consistent with the terms of this Agreement.
13. PRORATIONS AND ADJUSTMENTS. The following shall be prorated and adjusted
between Contributor and the REIT as of 11:59 p.m. on the day immediately
preceding the Closing Date, except as otherwise specified:
(a) The amount of all security and other Tenant deposits, without accrued
interest, shall be transferred or credited to the Acquiror (except in those
instances where the Tenant is entitled to accrued interest under the applicable
lease);
(b) To the extent such charges are not billed directly to Tenants, water,
electricity, sewer, gas, telephone and other utility charges shall be prorated
based, to the extent practicable, on final meter readings and final invoices,
or, in the event final readings and invoices are not available, based on the
most currently available billing information, and re-prorated upon issuance of
final utility bills;
(c) Amounts paid or payable under any Assumed Contracts shall be prorated based,
to the extent practicable, on final invoices or, in the event final invoices are
not available, based on the most currently available billing information, and
re-prorated upon issuance of final invoices;
(d) All fees, water, sewer and general real estate taxes and special
assessments, if any, relating to the Property payable during the year in which
Closing occurs shall be prorated as of the Closing Date. If Closing shall occur
before the actual taxes and special assessments payable during such year are
known, the apportionment of taxes shall be upon the basis of taxes for the
Property payable during the immediately preceding year, provided that, if the
taxes and special assessments payable during the year in which Closing occurs
are thereafter determined to be more or less than the taxes payable during the
preceding year (after any appeal of the assessed valuation thereof is
concluded), Acquiror and Contributor promptly shall adjust the proration of such
taxes and special assessments and Acquiror or Contributor, as the case may be,
shall pay to the other any amount required as a result of such adjustment and
this covenant shall not merge with the deeds delivered hereunder but shall
survive the Closing.
(e) All assessments, general or special, shall be prorated as of the Closing
Date on a "due date" basis such that Contributor shall be responsible for any
installments of assessments which are first due or payable prior to the Closing
Date and the REIT shall be responsible for any installments of assessments which
are first due or payable on or after the Closing Date;
(f) Commissions of leasing and rental agents for any Lease entered into as of or
prior to the Effective Date, whether with respect to base lease term, future
expansions, renewals, or otherwise, shall have been paid in full by Contributor,
without contribution or proration from the REIT or Acquiror;
(g) All base rents and other charges, including, without limitation, all common
area maintenance and other pass-through charges to Tenants, shall be prorated as
follows:
(i) Rents received by Contributor as of the Closing for the calendar month in
which the Closing shall occur shall be adjusted as of the date of Closing;
(ii) Rents received by Acquiror or Contributor from a particular tenant after
the date of Closing shall be adjusted as of the date of Closing; any adjustments
under this Section 13(g)(ii) shall be made by Contributor and Acquiror at the
end of each week in which checks are received from a particular tenant.
(iii) Except as provided in subsection 13(g)(ii) above with respect to rents
received by Contributor or Acquiror after the date of Closing, no adjustment
shall be made for delinquent rent owing to Contributor on the date of Closing,
and Acquiror shall be under no obligation to collect any such rents; provided,
however, that the REIT agrees to cause the Acquiror, at no third party or out of
pocket cost to the REIT or Acquiror, to cooperate with and assist Contributor in
collecting the amounts specified on Schedule 13(g) attached hereto from those
tenants specified on Schedule 13(g), which Schedule shall be updated by
Contributor at Closing to reflect additional delinquent rent first accruing
after the Effective Date and before the Closing. The REIT agrees that neither it
nor the Acquiror shall adjust or compromise the amount of any delinquent rent
owing to Contributor on the date of Closing. After the Closing, Contributor
shall be entitled to sue any Tenant named on Schedule 13(g) for delinquent rent,
up to the amounts specified on Schedule 13(g), with respect to the period prior
to the Closing, but shall not be entitled to evict or sue for possession of
premises occupied by a tenant owing delinquent rent. Payments for base rent
received shall be deemed to be for and shall be applied in the following order:
first, to rent then due and payable in the month of the Closing; second, to any
delinquent rent for the period after the Closing; and third to any delinquent
rent for the period prior to the Closing. Payments for common area maintenance
or taxes shall be applied for the period for which they relate to. The
provisions of this Section 13 (g) shall survive the closing of the transactions
contemplated in this Agreement.
At the time(s) of final calculation and collection from
Tenants of common area maintenance and other pass-through charges for 2002,
there shall be a re-proration between the REIT and Contributor as to such
additional charges adjustments, which re-proration shall be paid upon the REIT's
presentation of its final accounting to Contributor, certified as to accuracy by
the REIT. The party's respective obligations to re-prorate such additional
charges shall survive the Closing. (h) Any other costs or charges of closing
this transaction not specifically mentioned in this Agreement shall be paid and
adjusted in accordance with local custom in the City of Stamford.
For purposes of calculating Prorations, the Acquiror shall be
deemed to be in title to the Property, and therefore entitled to the income
therefrom and responsible for the expenses thereof, for the entire Closing Date.
All such Prorations shall be made on the basis of the actual number of days of
the year and month that shall have elapsed as of the Closing Date.
14. CLOSING EXPENSES. Acquiror will pay the entire cost of the Title Policy, the
Survey, the UCC Searches (including any and all "date downs" thereto), recording
fees and all fees and expenses imposed by the REIT's and the Acquiror's
accountants and attorneys in connection with this Agreement and the transaction
contemplated hereunder. Contributor will pay for: (i) all costs associated with
the assumption of the Existing Mortgage, other than those costs incurred by
Acquiror in complying with the second to last sentence of Section 5(c) hereof;
(ii) all fees and expenses imposed by its accountants and attorneys in
connection with this Agreement and the transaction contemplated hereunder, and
(iii) for all conveyance and transfer taxes.
15. DEFAULT BY REIT. If any of the REIT's or Acquiror's representations and
warranties herein are not true and correct on the Closing Date or if the REIT or
Acquiror fails to perform any of the covenants and agreements herein to be
performed by such party within the time for their performance, and
notwithstanding such default, Contributor has closed this transaction,
Contributor's rights shall be only those expressly set forth in this Agreement
and Contributor shall be deemed to have waived all other rights to rescission,
or any other remedy, except for actual monetary damages. Except as otherwise
specifically provided in the final paragraphs of Paragraphs 7.2 and 7.3 and in
Paragraph 24 hereof, Contributor shall have no remedy other than as provided in
this Section 15 for any default by the REIT.
16. SUCCESSORS AND ASSIGNS. Prior to the Closing, neither party to this
Agreement shall assign this Agreement nor any of their respective rights or
obligations hereunder without the other party's written consent, which may be
withheld in such party's sole and absolute discretion. This Agreement shall be
binding upon and shall inure to the benefit of the parties and their respective
nominees, successors, beneficiaries and permitted assigns.
17. LITIGATION. In the event of litigation between the parties with respect to
the Property, this Agreement, the performance of their respective obligations
hereunder or the effect of a termination under this Agreement, the losing party
shall pay all costs and expenses incurred by the prevailing party, including,
but not limited to, reasonable attorneys' fees of counsel selected by the
prevailing party. In the event of litigation between the parties, as
contemplated above, and the resolution of that litigation through compromise,
settlement, or partial judgment, the court before which such litigation is
initially brought may allocate responsibility, between Contributor and the REIT,
for all costs and expenses (including, but not limited to, attorneys' reasonable
fees) incurred by both Contributor and the REIT in the pursuit of that
litigation resolved through compromise, settlement or partial judgment.
Notwithstanding any provision of this Agreement to the contrary, the obligations
of the parties under this Paragraph 17 shall survive termination of this
Agreement.
18. NOTICES. Any notice, demand or request which may be permitted, required or
desired to be given in connection therewith shall be given in writing and
directed to Contributor and the REIT as follows:
Contributor: Stamford Ridgeway
Associates Limited Partnership
c/o Silverstein Properties, Inc.
521 Fifth Avenue
New York, New York 10175
Attn: Mr. Larry A. Silverstein
and Michael Levy
Stamford Ridgeway Corporation
Tel: 212-551-7333
Fax: 212-687-0067
With a copy to
its attorneys: Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, NY 10153
Attn: Alan J. Pomerantz, Esq.
Tel: 212-310-8402
Fax: 212-310-8105
With a copy to : DKH Stamford Associates L.P.
5 Becker Farm Road
Roseland, New Jersey 07068
Attn: Howard Menaker, Esq.
Tel: 973-994-4700
Fax: 973-994-4730
With a copy to: Wolff & Samson
280 Corporate Center
5 Becker Farm Road
Roseland, New Jersey 07068-1776
Attn: Martin L. Wiener, Esq.
Tel: 973-740-0500
Fax: 973-740-1407
The REIT and Acquiror: Urstadt Biddle Properties Inc.
321 Railroad Avenue
Greenwich, Connecticut 06830
Attn: Willing Biddle
Tel: (203) 863-8200
Fax: (203) 861-6755; and
Urstadt Biddle Properties Inc.
321 Railroad Avenue
Greenwich, Connecticut 06830
Attn: Legal Department
Tel: (203) 863-8200
Fax: (203) 861-6755
With a copy to
its attorneys: Cummings & Lockwood LLC
Four Stamford Plaza
P.O. Box 120
Stamford, Connecticut 06904
Attn: Michael J. Hinton, Esq.
Tel: (203) 351-4492
Fax: (203) 351-4450
Notices shall be deemed properly delivered and received (i)
when personally delivered or on the day delivery is rejected; (ii) when faxed,
provided that a duplicate of such Notice is deposited with Federal Express or
other commercial overnight courier for delivery the next day ("Overnight
Courier") on the date of such fax; or (iii) on the first business day after
deposit with any Overnight Courier for delivery on the next business day.
Counsel for a party may deliver notice on behalf of its client, and such notice
shall be deemed to constitute notice of such client for purposes of this
Agreement.
19. BENEFIT. This Agreement is for the benefit only of the parties hereto and
their nominees, successors, beneficiaries and assignees as permitted in
Paragraph 16 and no other person or entity shall be entitled to rely hereon,
receive any benefit herefrom or enforce against any party hereto any provision
hereof.
20. LIMITATION OF LIABILITY. Neither the REIT nor Acquiror shall assume or
undertake to pay, satisfy or discharge any liabilities, obligations or
commitments of Contributor other than those specifically agreed to between the
parties in this Agreement. Except with respect to the foregoing obligations,
neither the REIT nor Acquiror shall assume or discharge any debts, obligations,
liabilities or commitments of Contributor, whether accrued now or hereafter,
fixed or contingent, known or unknown.
21. BROKERAGE. Each party hereto represents and warrants to the other that it
has dealt with no brokers or finders in connection with this transaction and
that no broker, finder or other party is entitled to a commission, finder's fee
or other similar compensation as a result hereof, other than Daniel Zelson (the
"Broker"). At the Closing, Acquiror shall pay a commission to the Broker
pursuant to and in accordance with the terms of a separate letter agreement
between the REIT and the Broker. REIT and Acquiror hereby agree to indemnify,
defend and hold the Contributor harmless from and against all losses, claims,
costs, expenses, damages (including, but not limited to, attorneys' fees of
counsel selected by the Contributor) resulting or arising from the claims of any
broker, finder or other such party, claiming by, through or under the acts or
agreements of the REIT or the Acquiror. Contributor hereby agrees to indemnify,
defend and hold the REIT and Acquiror, and their respective partners, officers,
agents, brokers and representatives harmless from and against all losses,
claims, costs, expenses, damages (including, but not limited to, attorneys' fees
of counsel selected by the REIT and Acquiror) resulting or arising from the
claims of any broker, finder or other such party claiming by, through or under
acts or agreements of the Contributor. This Paragraph 21 shall survive the
Closing.
22. REASONABLE EFFORTS. Contributor, Acquiror and the REIT shall use their
reasonable, diligent and good faith efforts, and shall cooperate with and assist
each other in their efforts, to obtain such consents and approvals of third
parties (including, but not limited to, governmental authorities), to the
transaction contemplated hereby, and to otherwise perform as may be necessary to
effectuate the transfer of the Property to Acquiror in accordance with this
Agreement.
23. POST-EFFECTIVE DATE LEASING. Acquiror shall pay all tenant improvement costs
and brokerage commissions attributable to any new lease entered into at the
Property after the Effective Date. Contributor shall continue to be responsible
for the payment of all tenant improvement costs and brokerage commissions
attributable to any lease executed before the Effective Date, payable under any
written or oral agreement entered into by Contributor. Between the period
starting on the Effective Date and ending on the Closing Date, Contributor shall
not enter into any new leases at the Property or modify or terminate any
existing lease without first obtaining the consent of the REIT, which consent
shall not be unreasonably withheld, delayed or conditioned.
24. INDEMNIFICATION.
---------------
(a) From and after the Closing Date, Contributor agrees to and does hereby
indemnify, defend and hold harmless the REIT, its partners, the respective
agents, contractors, employees, investors, directors and officers and
representatives of each of the REIT and its partners, and each of their
successors and assigns, Acquiror, its partners and the respective agents,
contractors, employees, investors, trustees and representatives of each of
Acquiror and its partners, and each of their successors and assigns, from and
against any and all liabilities, claims, demands, suits, administrative
proceedings, causes of action, costs, damages, losses and expenses, both known
and unknown, present and future, at law or in equity, arising out of, resulting
from, by virtue of, or related in any way to (a) required tax return filings
pursuant to Treasury Regulation Section 1.897-5T(d)(1)(iii) (as discussed in
Subparagraph 7.1(m)), (b) the suits, proceedings or other matters set forth in
Section 7.1(h), (c) a breach of any representation, warranty or covenant of
Contributor set forth herein, (d) any rent or common area maintenance
overpayment, refund, adjustment or credit due to or claimed by a Tenant in
respect of the period prior to the Closing, and (e) any fees, commissions,
expenses or other charges payable in connection with the Management Agreement.
Contributor acknowledges and agrees that its obligation to indemnify the REIT
and Acquiror includes, without limitation reasonable attorneys' fees and costs
incurred by the REIT and/or Acquiror with respect to enforcing its rights under
this indemnification provision. This indemnity and the obligations herein shall
survive the Closing. Contributor's indemnification obligations under this
Agreement with respect to any representation, warranty or covenant of
Contributor contained herein shall be subject to Contributor's receipt of
specific written notice of a breach or claim or potential breach or claim with
respect to such representation, warranty or covenant during the survival period
of the underlying representation, warranty or covenant to which it relates.
(b) From and after the Closing Date, Acquiror and the REIT agree to and do
hereby indemnify, defend and hold harmless Contributor, its partners, the
respective agents, contractors, employees, investors, directors and officers and
representatives of each of Contributor and its partners, and each of their
successors and assigns, from and against any and all liabilities, claims,
demands, suits, administrative proceedings, causes of action, costs, damages,
losses and expenses, both known and unknown, present and future, at law or in
equity, arising out of, resulting from, by virtue of, or related in any way to
(a) a breach of any representation, warranty or covenant of Acquiror or the REIT
set forth herein and (b) any claim by a Tenant in respect of the period after
the Closing. Acquiror and the REIT acknowledge and agree that their obligations
to indemnify Contributor includes, without limitation reasonable attorneys' fees
and costs incurred by Contributor with respect to enforcing its rights under
this indemnification provision. This indemnity and the obligations herein shall
survive the Closing. Acquiror's and the REIT's indemnification obligations under
this Agreement with respect to any representation, warranty or covenant of
Acquiror or the REIT contained herein shall be subject to Acquiror 's and the
REIT's receipt of specific written notice of a breach or claim or potential
breach or claim with respect to such representation, warranty or covenant during
the survival period of the underlying representation, warranty or covenant to
which it relates.
25. Casualty and Condemnation.
-------------------------
(a) Casualty.
(i) Until the Closing, the risk of loss by fire or other casualty to the
Improvements, and liability for personal injury or damage to property of others
at the Property, shall be borne by the Contributor.
(ii) In the event of damage by fire or other casualty to twenty percent or more
of the square footage of the improvements located on the Property prior to the
Closing which is not reasonably capable of being repaired within ninety (90)
days, the Contributor shall notify the REIT in writing of such damage, and the
REIT shall have the option to terminate this Agreement by giving written notice
of such election to the Contributor within ten (10) business days after
receiving notice of such damage. If the REIT shall exercise its right to
terminate this Agreement pursuant to this Section 25 (a), the Earnest Money and
all interest accrued thereon shall be returned to the REIT, and the parties
shall be relieved of all further liabilities and obligations hereunder with
respect to the Property. If the REIT does not elect to terminate this Agreement
within the ten business day period contemplated above or the damage affects less
than twenty percent of the square footage of the improvements located on the
Property or if the damage is reasonably capable of being repaired within ninety
(90) days, this Agreement shall remain in full force and effect and in such
event the Contributor shall pay over and assign or cause to be paid over and
assigned to the REIT at the Closing any and all proceeds and claims under any
casualty insurance policies insuring the damaged property, together with amount
of any deductibles under any such policies. The Contributor shall have no
obligation to repair casualty damage prior to the Closing.
(iii) In the event that the Acquiror shall be subject to a personal injury or
property damage claim at any time relating to an incident occurring at the
Property prior to the Closing which is not either covered by insurance or
defended by the insurance carrier's counsel, the Contributor shall defend (with
counsel of its choice reasonably acceptable to the Acquiror), indemnify and hold
harmless Acquiror from and against all losses, damages, costs and expenses
(including attorneys' fees) that Acquiror may suffer with respect to any such
claim or incident. In the event the Contributor fails to engage counsel who
files an appearance in any such litigation within four weeks of being served
with a complaint or other legal process in connection with a matter covered by
the foregoing indemnification, the Acquiror shall be entitled to engage its own
counsel to defend such claim, and the reasonable cost of such counsel shall be
an expense that is reimbursable to the Acquiror pursuant to this subsection.
Without the prior written consent of the Acquiror, which consent shall not be
unreasonably withheld, the Contributor will not enter into any settlement of any
claims for which the Acquiror is entitled to indemnification pursuant to this
subsection if pursuant to or as a result of such settlement, such settlement
would lead to liability or create any financial or other obligation on the part
of the Acquiror for which the Acquiror is not entitled to indemnification
hereunder. This obligation to defend, indemnify and hold harmless shall survive
the Closing.
(b) Condemnation. If, prior to the Closing, all or twenty percent or more of the
square footage of the improvements on the Property is taken by eminent domain,
the Contributor shall notify the REIT in writing of such taking, and the REIT
shall have the option either (i) to elect not to acquire the Property by giving
written notice of such election to the Contributor within ten (10) business days
after receiving notice of such taking, in which case the Earnest Money and all
interest accrued thereon shall be returned to the REIT, this Agreement shall
terminate and such parties shall be relieved of all further rights and
obligations with respect thereto, or (ii) to acquire the Property, subject to
such action, without adjustment in the Contribution Consideration and otherwise
in accordance with the terms and provisions of this Agreement, but Acquiror
shall upon Closing be entitled to the proceeds of all awards made on account of
such taking which would otherwise accrue to the Contributor. The REIT shall give
written notice to the Contributor of any election pursuant to this Section
within ten (10) business days following receipt by the REIT of any written
notice of such taking or proposed taking. Failure of the REIT to make such
election within said period shall be deemed an election to proceed to Closing
pursuant to clause (ii) above.
26. MISCELLANEOUS.
-------------
(a) Entire Agreement. This Agreement constitutes the entire understanding
between the parties with respect to the transaction contemplated herein, and all
prior or contemporaneous oral agreements, understandings, representations and
statements, and all prior written agreements, understandings, letters of intent
and proposals are merged into this Agreement. Neither this Agreement nor any
provisions hereof may be waived, modified, amended, discharged or terminated
except by an instrument in writing signed by the party against which the
enforcement of such waiver, modification, amendment, discharge or termination is
sought, and then only to the extent set forth in such instrument.
(b) Time of the Essence. Time is of the essence with respect to this Agreement.
If any date herein set forth for the performance of any obligations by
Contributor or the REIT or for the delivery of any instrument or notice as
herein provided should be on a Saturday, Sunday or legal holiday, the compliance
with such obligations or delivery shall be deemed acceptable on the next
business day following such Saturday, Sunday or legal holiday. As used herein,
the term "legal holiday" means any state or federal holiday for which financial
institutions or post offices are generally closed in the State of New York for
observance thereof.
(c) Waiver of Conditions. Each of the REIT and Contributor shall have the right,
at any time and from time to time, to waive any or all of the REIT's or
Contributor's, as the case may be, respective Conditions Precedent, each of
which is for the sole benefit of the REIT or Contributor, as the case may be,
and may be waived at any time by written notice thereof from the REIT to
Contributor, or from Contributor to the REIT, as the case may be. The waiver of
any particular of the REIT's or Contributor's Condition Precedent shall not
constitute the waiver of any other.
(d) Representations and Warranties. Relative to each representation and warranty
made by a party in this Agreement other than its knowledge or best of knowledge,
the representing or warranting party shall be charged with making reasonable
inquiries as to the accuracy thereof to its officers, employees, managers,
contractors, agents and representatives.
(e) Construction. This Agreement shall not be construed more strictly against
one party than against the other merely by virtue of the fact that it may have
been prepared by counsel for one of the parties, it being recognized that both
Contributor and the REIT have contributed substantially and materially to the
preparation of this Agreement. The headings of various Paragraphs in this
Agreement are for convenience only, and are not to be utilized in construing the
content or meaning of the substantive provisions hereof.
(f) Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Connecticut.
(g) Partial Invalidity. The provisions hereof shall be deemed independent and
severable, and the invalidity or partial invalidity or enforceability of any one
provision shall not affect the validity of enforceability of any other provision
hereof.
(h) Expenses. Except as and to the extent otherwise expressly provided to the
contrary herein, the REIT and Contributor shall each bear its own respective
costs and expenses relating to the transactions contemplated hereby, including,
without limitation, fees and expenses of legal counsel or other representatives
for the services used, hired or connected with the proposed transactions
mentioned above.
(i) Certain Securities Matters. No sale of LP Units is intended by the parties
by virtue of their execution of this Agreement. Any sale of LP Units referred to
in this Agreement will occur, if at all, upon the Closing.
(j) Counterparts. This Agreement may be executed in multiple counterparts, each
of which shall be deemed an original, but all of which, together, shall
constitute one and the same instrument. A facsimile of a signature shall have
the same legal effect as an originally drawn signature.
(k) Confidentiality. The terms and provisions of this Agreement shall remain
confidential and shall not be disclosed, by either Contributor, Acquiror or the
REIT, to any third party other than: (i) the current partners of Contributor;
(ii) the current property manager of the Property and any other third parties
who provide services to the Property, whose services will effectively be
terminated upon the Closing contemplated herein; (iii) the Lender and its
counsel; (iv) as may be required by law or regulation in connection with any
litigation or other enforcement proceeding among the parties to this Agreement,
or to comply with the filing requirements of any applicable law or rule
(including, without limitation, the filing of an 8-K, 10-Q, 10-K and other
filings or notifications required under applicable Securities and Exchange
Commission rules or New York Stock Exchange rules); or (v) any counsel,
accountants, consultant, or agent assisting the parties to this Agreement with
the transactions contemplated in this Agreement. If Closing does not proceed,
Acquiror shall return to Contributor all materials and information furnished to
it by Contributor or its agents in connection with its review of the Property.
Contributor shall, and shall direct its agents, not to solicit, offer, or accept
an offer for the purchase or other conveyance of the Property from any other
parties until the termination of this Agreement.
(l) Jurisdiction. THE PARTIES AGREE THAT ALL DISPUTES BETWEEN ANY OF THEM
ARISING OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP
ESTABLISHED BETWEEN THEM IN CONNECTION WITH THIS AGREEMENT, AND WHETHER ARISING
IN LAW OR EQUITY OR OTHERWISE, SHALL BE RESOLVED BY THE COURTS LOCATED IN
STAMFORD, CONNECTICUT. NOTHING HEREIN SHALL AFFECT THE RIGHT OF ANY PARTY TO
SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL
PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE OTHER IN ANY OTHER JURISDICTION.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties hereto have executed this Contribution Agreement
on this ___ day of March, 2002.
REIT:
URSTADT BIDDLE PROPERTIES INC.
By:
---------------------------------------
Name:
Title:
CONTRIBUTOR:
STAMFORD RIDGEWAY ASSOCIATES
LIMITED PARTNERSHIP
By: Stamford Ridgeway Corporation,
Its General Partner
By:
---------------------------------------
Name:
Title:
By: DKH, Inc.
Its General Partner
By:
---------------------------------------
Name:
Title:
ACQUIROR:
UB Stamford, L.P.
By: URSTADT BIDDLE PROPERTIES INC.
its General Partner
By:
---------------------------------------
Name:
Title:
...StmLib1:940372.1 03/25/02