SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, each
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
RECKSON ASSOCIATES REALTY CORP.
By: /s/ Jason M. Barnett
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Jason M. Barnett
Executive Vice President
and General Counsel
RECKSON OPERATING PARTNERSHIP, L.P.
By: Reckson Associates Realty Corp.,
its General Partner
By: /s/ Jason M. Barnett
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Jason M. Barnett
Executive Vice President
and General Counsel
Date: August 18, 2005
3
Exhibit 10.1
BLAKE DAWSON WALDRON
LAWYERS
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Underwriting Agreement
Reckson Operating Partnership, LP
Reckson Australia Management Limited
ABN 65 114 294 281
as responsible entity for the Reckson New York Property Trust
ARSN 115 585 709
UBS AG, Australia Branch
ABN 47 088 129 613
Citigroup Global Markets Australia Pty Limited
ABN 64 003 114 832
Level 36
Grosvenor Place
225 George Street
Sydney NSW 2000 Ref: SJD MDRV 02 1387 3037
Telephone: + 61 2 9258 6000
Fax: + 61 2 9258 6999
(C) Blake Dawson Waldron 2005
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CONTENTS
1. INTERPRETATION 1
1.1 Definitions 1
1.2 Rules for interpreting this agreement 7
1.3 Business Days 8
1.4 Success of the Offer 8
1.5 Valid Application 8
1.6 Underwriters' relationship 8
2. CONDITIONS PRECEDENT 9
2.1 Conditions precedent to underwriting 9
2.2 Obligations to satisfy conditions 9
2.3 Waiver 9
2.4 Failure to fulfil condition precedent 9
3. APPOINTMENT AND OBLIGATION TO UNDERWRITE 10
3.1 Appointment 10
3.2 Agreement to underwrite 10
3.3 Agreement to manage 10
3.4 Several obligations 10
3.5 Sub-underwrite 10
4. WARRANTIES, UNDERTAKINGS AND INDEMNITIES 10
4.1 Validity of agreement 10
4.2 Responsible Entity 11
4.3 Independent 11
4.4 Undertaking 11
4.5 Repetition 11
4.6 Indemnity 11
4.7 Survival 11
4.8 Reliance 11
4.9 Cessation of ROP liability 11
5. OFFER 12
5.1 Making of Offer 12
5.2 Amendment 12
5.3 Withdrawal of the Offer 12
5.4 Application for quotation 12
5.5 Supplementary Offer Document 12
5.6 No other Supplementary Offer Document 13
5.7 Warranties about Supplementary Offer Document 13
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6. CONDUCT OF OFFERS 13
6.1 Support and access 13
6.2 Applications 13
6.3 Notification of Applications 13
6.4 Acceptance of Applications 14
6.5 Nomination of Allottees 14
6.6 Allotment of Offer Securities 14
6.7 Holding Statements 15
6.8 Prompt Banking of Cheques 15
6.9 Initial Instalment 15
6.10 Records 15
6.11 Relief of Liability 15
6.12 No Shortfall 15
7. SHORTFALL AND ALLOTMENT 15
7.1 Notice of Shortfall Securities 15
7.2 Certificate to accompany notice 16
7.3 Certificate Representations and Warranties 16
7.4 Facilitation of settlement 16
7.5 Requirement to pay 16
7.6 Liability Extinguished 17
7.7 Allotment of Securities 17
8. Final instalment 17
8.1 Request for Payment of Final Instalment 17
8.2 Notice of Unpaid Instalments 17
8.3 Cancellation of Forfeiture 18
8.4 Certificate to accompany notice 18
8.5 Underwriting of Instalment Shortfall Units 18
8.6 Liability of the Responsible Entity 18
8.7 Notification of assignment of rights 19
8.8 Assignment of rights 19
8.9 Liability extinguished 19
9. FEES, COSTS AND EXPENSES 19
9.1 Payment of fees 19
9.2 Costs and expenses 20
9.3 Costs on termination 20
9.4 Set off 21
10. EVENTS OF TERMINATION 21
10.1 Right of termination 21
10.2 Exercise of rights 25
10.3 Right of termination after Allotment Date 25
10.4 Claims 26
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ii.
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10.5 Notification 26
10.6 Effect of termination 26
11. ADVERTISING AND PUBLIC ANNOUNCEMENTS 27
11.1 Promotion of Offer 27
11.2 Responsibility for promotion 28
11.3 Disclosure 28
12. ACCESS TO INFORMATION 28
12.1 Access and information 28
12.2 ASX and ASIC 28
12.3 Due diligence materials 29
13. ACKNOWLEDGMENTS 29
13.1 Acknowledgments 29
13.2 Agreements 29
14. GST 30
14.1 Definitions 30
14.2 GST payable in addition to fees 30
14.3 GST on claims and expenses 30
15. NOTICES 31
15.1 How to give a notice 31
15.2 When a notice is given 31
15.3 Address for notices 31
16. AMENDMENT AND ASSIGNMENT 32
16.1 Amendment 32
16.2 Assignment 32
17. GENERAL 32
17.1 Governing law 32
17.2 Giving effect to this agreement 32
17.3 Waiver of rights 32
17.4 Operation of this agreement 33
17.5 Inconsistency with other documents 33
17.6 Time is of the essence 33
17.7 Counterparts 33
17.8 Attorneys 33
17.9 Responsible Entity 33
17.10 Indemnities 34
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iii.
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Schedule
1 CERTIFICATE 35
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2 WARRANTIES 37
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3 INDEMNITY 44
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4 TIMETABLE 51
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iv.
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UNDERWRITING AGREEMENT
DATE 12 August 2005
PARTIES
Reckson Operating Partnership, LP (ROP)
Reckson Australia Management Limited ABN 65 114 294 281 (the
Responsible Entity) as responsible entity for the Reckson New York
Property Trust ARSN 115 585 709.
UBS AG, Australia Branch ABN 47 088 129 613 (UBS)
Citigroup Global Markets Australia Pty Limited ABN 64 003 114 832
(Citigroup)
RECITALS
A. The Responsible Entity is the responsible entity of the Trust and
proposes to make the Offer.
B. ROP is the controller of the Responsible Entity, and has agreed to
enter into this agreement at the request of the Underwriters.
C. The Underwriters have agreed to underwrite:
(a) subscriptions of the Initial Instalment for the Offer Securities;
and
(b) payment of the Final Instalment on the Allotted Units,
on the terms and conditions set out in this agreement.
OPERATIVE PROVISIONS
1. INTERPRETATION
1.1 Definitions
The following definitions apply in this agreement.
Allotment Date means the date specified as such in the Timetable as
varied, if at all pursuant to clause 5.2.
Allotted Units means the number of Offer Securities to be allotted
pursuant to the Offer Document.
Application means:
(a) an application for Offer Securities made on a duly completed
Application Form; and
(b) an Institutional Application.
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Application Form means the application form attached to or
accompanying the Offer Document, in the form agreed by the parties
and initialled by them on the date of this agreement for the purposes
of identification.
ASIC means the Australian Securities and Investments Commission.
ASX means Australian Stock Exchange Limited ABN 98 008 624 691.
Authorisation means:
(a) an authorisation, consent, declaration, exemption, notarisation
or waiver, however it is described; and
(b) in relation to anything that could be prohibited or restricted by
law if a Government Agency acts in any way within a specified
period, the expiry of that period without that action being taken,
including any renewal or amendment.
Business Day has the meaning given to that expression by the Listing
Rules.
Call Date means the date specified as such in the Timetable, as
varied if at all, pursuant to clause 5.2.
Call Option has the meaning given to the term "Option Agreement" in
the Offer Document.
Certificate means a certificate in the form of schedule 1 (or in such
other form agreed between the Responsible Entity and the
Underwriters) executed by two directors or a director and secretary
of the Responsible Entity.
CHESS has the meaning given to that expression in the Listing Rules.
Claim means, in relation to any person, a claim, action, proceeding
or demand made against the person, however arising, and whether
present or future, fixed or unascertained, actual or contingent.
Closing Date means the date specified as such in the Timetable, as
varied, if at all, pursuant to clause 5.2.
Corporations Act means the Corporations Act 2001 (Cth).
Debt Facilities means any debt facilities entered into by US REIT, US
LLC or any subsidiary of US LLC or in connection with any of the
Properties, as contemplated in the Offer Document.
Due Diligence Committee means the Due Diligence Committee established
to undertake due diligence investigations and enquiries on behalf of
the Responsible Entity, its directors, the Underwriters and others in
connection with the Offer and the preparation of the Offer Document.
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2.
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Due Diligence Program means the due diligence and verification
procedures planned and reviewed by the Due Diligence Committee in
relation to the Offer and the Offer Document.
Due Diligence Report means the report of the Due Diligence Committee
to the directors of the Responsible Entity and to the members of the
Due Diligence Committee in connection with the Offer and the Offer
Document including all supporting documents and other work papers to
which the Underwriters are given access for the purposes of due
diligence investigations described in the Planning Memorandum
relating to the preparation of the Offer Document.
Due Diligence Results means the results of the investigations which
make up the Due Diligence Program.
Event of Termination means an event entitling an Underwriter to
terminate this agreement as provided in clause 10.
Final Instalment means $0.35
Final Instalment Payment Date means the date specified as such in the
Timetable, as varied, if at all, under clause 5.2.
Foreign Exchange Hedging Contracts means the ISDA swap documents
which hedge the foreign exchange risk of the Responsible Entity
entered into on or about the date of this agreement with each of the
Underwriters or their related bodies corporate.
Government Agency means:
(a) a government or government department or other body;
(b) a governmental, semi-governmental or judicial person; or
(c) a person (whether autonomous or not) who is charged with the
administration of a law.
Indemnified Claim means any Loss directly or indirectly suffered by,
or Claim made against, an Indemnified Party in respect of which an
Indemnified Party is entitled to be indemnified under paragraph 1 of
schedule 3.
Indemnified Party has the meaning given to that term in schedule 3.
Initial Instalment means $0.65.
Initial Offer Proceeds means the amount calculated by multiplying the
Initial Instalment by the number of Allotted Units.
Instalment Proceeds means the amount calculated by multiplying the
Final Instalment by the number of Allotted Units.
Instalment Shortfall Sale Date means the date specified as such in
the Timetable as varied, if at all, under clause 5.2.
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3.
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Instalment Shortfall Units has the meaning given to that term in
clause 8.2.
Institutional Application means an offer acceptance advice in respect
of Offer Securities in the form approved by the Underwriters which is
returned by an Institutional Investor to the Underwriters to confirm
its acceptance of the number of Offer Securities allocated to it by
the Underwriters and the terms on which those Offer Securities are
allocated to it.
Institutional Investor means a person to whom an offer of Offer
Securities may be made without the lodgement of a product disclosure
statement under the Corporations Act.
Institutional Offer Securities means that number of Offer Securities
in respect of which the Responsible Entity is taken to have received
Valid Applications from Institutional Investors (other than
Participating Brokers) which are allocated by the Underwriters to
those Institutional Investors (other than Participating Brokers).
Institutional Proceeds means the number of Institutional Offer
Securities multiplied by the Initial Instalment.
Issue Price means $1.00.
Listing Rules means the Listing Rules of ASX (including the ASTC
Settlement Rules, the ASX Market Rules and the ACH Clearing Rules) as
waived or modified by ASX in respect of the Responsible Entity, the
Trust or the Offer, in any particular case.
LLC Agreement has the meaning given to that term in the Offer
Document.
Lodgement Date means the date specified as such in the Timetable as
varied, if at all, pursuant to clause 5.2.
Loss means, in relation to a person, a damage, loss, cost, expense or
liability incurred by the person, however arising and whether present
or future, fixed or unascertained, actual or contingent.
LSE means the London Stock Exchange
LSE Trading Day means a day on which LSE is open for trading.
Mandate Letter means the letter agreement between the Underwriters
and Reckson Associates dated on or about 26 July 2005.
Market Price has the meaning given to that expression in the Scheme
Constitution.
NYSE means the New York Stock Exchange.
NYSE Trading Day means a day on which NYSE is open for trading.
Offer means the invitation to subscribe for Offer Securities to raise
the Offer Amount made pursuant to the Offer Document.
Offer Amount is AUD$263,413,889.
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4.
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Offer Document means the product disclosure statement to be issued by
the Responsible Entity in relation to the Offer in a form approved by
the Underwriters (acting reasonably) and initialled for the purposes
of identification by the Responsible Entity and the Underwriters (as
modified, to the extent applicable, by any Supplementary Offer
Document).
Offer Securities means the Units the subject of the Offer.
Opening Date means the date, specified as such in the Timetable as
varied, if at all, under clause 5.2.
Pathfinder Document means the advanced copies of the Offer Document
provided to the Underwriters for distribution to prospective
sub-underwriters and Institutional Investors under clause 6.1.
Participating Broker means those participating organisations of ASX
selected by the Underwriters to participate in the Offer.
Planning Memorandum means the memorandum describing the Due Diligence
Program adopted by the Due Diligence Committee in relation to the
Offer and the Offer Document.
Prescribed Occurrence means, in relation to a person, the events set
out in section 652C of the Corporations Act but substituting that
person for "target" and "equity interests" for "shares" and provided
that:
(a) the issue of Offer Securities pursuant to the Offer; and
(b) the issue of Units by the Trust
shall not constitute a Prescribed Occurrence.
Properties has the meaning given to that term in the Offer Document.
Publication has the meaning given to that term in paragraph (d) of
Part 2 of schedule 2.
Reckson Associates means Reckson Associates Realty Corp.
Relevant Index means the S&P/ASX 200 Index and the S&P/ASX 200
Property Index.
Sale Agreement has the meaning given to the term "Sale Agreement" in
the Offer Document.
Scheme Constitution means the constitution constituting the Trust.
Settlement Date means the date specified as such in the Timetable as
varied, if at all, pursuant to clause 5.2.
Shortfall Amount means the amount which equals the Initial Instalment
multiplied by the number of Shortfall Securities.
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5.
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Shortfall Notification Date means the date specified as such in the
Timetable as varied, if at all, pursuant to clause 5.2.
Shortfall Securities has the meaning given to that term in clause
7.1.
Starting Level means in respect of a Relevant Index the level of that
index as at the close of business on the Business Day prior to the
date of this agreement.
Supplementary Offer Document means any supplementary or replacement
product disclosure statement to the Offer Document lodged with ASIC
in connection with the Offer.
Tax means a tax, levy, duty, charge, deduction or withholding,
however it is described, that is imposed by a Government Agency,
together with any related interest, penalty, fine or other charge,
other than one that is imposed on taxable income.
Timetable means the timetable for the Offer set out in schedule 4 as
varied, if at all, pursuant to clause 5.2.
Transaction means the transactions contemplated by the Transaction
Documents.
Transaction Documents means the Sale Agreement, the Debt Facilities,
the Foreign Exchange Hedging Contracts, the LLC Agreement, the Call
Option and any other agreements entered into by the Responsible
Entity, US REIT or US LLC in connection with the establishment of the
Trust or the acquisition, as contemplated by the Offer Document.
Trust means the Reckson New York Property Trust ARSN 115 585 709
which is a managed investment scheme registered under Part 5C of the
Corporations Act.
Underwriter means each of UBS and Citigroup and Underwriters means
both of UBS and Citigroup.
Underwritten Period means the period commencing on the date of this
agreement and ending on the Instalment Shortfall Sale Date.
Unit means an ordinary unit in the Trust.
Unpaid Instalment Amount has the meaning given to that term in clause
8.2.
Unpaid Instalment Notice has the meaning given to that term in clause
8.2.
US LLC has the meaning given to that term in the Offer Document.
US REIT has the meaning given to that term in the Offer Document.
Valid Application has the meaning given to that term in clause 1.5.
Verification Material means the contents of the file maintained by
the Due Diligence Committee being the documents and information
provided in verification of statements made in the Offer Document.
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6.
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1.2 Rules for interpreting this agreement
Headings are for convenience only, and do not affect interpretation. The
following rules also apply in interpreting this agreement, except where
the context makes it clear that a rule is not intended to apply.
(a) A reference to:
(i) legislation (including subordinate legislation) is to that
legislation as amended, re-enacted or replaced, and includes
any subordinate legislation issued under it;
(ii) a document, deed or agreement, or a provision of a document,
deed or agreement, is to that document, deed, agreement or
provision as amended, supplemented, replaced or novated;
(iii) a party to this agreement or to any other document or
agreement includes a permitted substitute or a permitted
assign of that party;
(iv) a person includes any type of entity or body of persons,
whether or not it is incorporated or has a separate legal
identity, and any executor, administrator or successor in
law of the person;
(v) anything (including a right, obligation or concept) includes
each part of it; and
(vi) a date or time means to that date or time in Sydney.
(b) A singular word includes the plural, and vice versa.
(c) A word which suggests one gender includes the other genders.
(d) If a word is defined, another part of speech has a corresponding
meaning.
(e) If an example is given of anything (including a right, obligation
or concept), such as by saying it includes something else, the
example does not limit the scope of that thing.
(f) The word "agreement" includes an undertaking or other binding
arrangement or understanding, whether or not in writing.
(g) The words "subsidiary", "holding company" and "related body
corporate" have the same meanings as in the Corporations Act.
(h) References to "applicable law" include all applicable laws of
jurisdictions within or outside Australia (including any State or
Federal law of the United States of America) and includes the
Listing Rules and policies, guidelines, official directives or
requests of or by any Government Agency, whether or not having the
force of law.
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7.
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1.3 Business Days
If the day on or by which a person must do something under this
agreement is not a Business Day:
(a) if the act involves a payment that is due on demand, the person
must do it on or by the next Business Day; and
(b) in any other case, the person must do it on or by the previous
Business Day (unless it is to occur contemporaneously with a
payment which is to be made on the next Business Day under the
preceding paragraph, in which case it will occur on that next
Business Day).
1.4 Success of the Offer
For the purposes of this agreement, the effect of any matter on the
success of the Offer is determined by assessing the likely effect of
that matter on a decision of an investor to invest in the Offer
Securities as if that decision to invest were made after the occurrence
of that matter and not by considering the number and extent of
applications for Offer Securities received before the occurrence of that
matter.
1.5 Valid Application
For the purposes of this agreement a Valid Application in respect of an
Offer Security is taken to have been received by the Responsible Entity
if:
(a) in the case of an application which is not an Institutional
Application, it is made on a duly completed Application Form and
submitted in accordance with the Offer Document before 5.00 p.m.
on the Closing Date and the Responsible Entity receives the First
Instalment in cleared funds by 5.00 p.m. on the Closing Date; and
(b) in the case of an Institutional Application it is made by an
Institutional Investor (other than a Participating Broker) who has
been allocated that Offer Security by the Underwriters and that
Institutional Investor has returned a duly completed Institutional
Application in respect of that Offer Security to the Underwriters
by the time specified by the Underwriters which includes those
details necessary to permit delivery versus payment to occur
through CHESS in respect of that Offer Security on the Settlement
Date.
1.6 Underwriters' relationship
(a) An obligation of an Underwriter under this agreement (including an
obligation to pay) is several on a 50:50 basis and not joint or
joint and several.
(b) A right of an Underwriter under this agreement is held by that
Underwriter severally and each Underwriter may exercise its
rights, powers and benefits under this agreement individually.
(c) Where the consent or approval of an Underwriter is required under
this agreement, that consent or approval must be obtained from
each Underwriter (other than an
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8.
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Underwriter which has given a notice under clause 8 to terminate
its obligations under this agreement).
(d) Nothing contained or implied in this agreement constitutes an
Underwriter the partner, agent, or representative of the other
Underwriter for any purpose or creates any partnership, agency or
trust between the Underwriters, and neither Underwriter has any
authority to bind the other in any way.
(e) Any reference to the Underwriter in this agreement is a reference
to each Underwriter separately, so that (for example) a
representation, warranty or undertaking is given by each of them
separately.
2. CONDITIONS PRECEDENT
2.1 Conditions precedent to underwriting
The obligations of the Underwriters to underwrite subscriptions of the
Initial Instalment for the Offer Securities and payment of the Final
Instalment on the Allotted Units under this agreement do not become
binding unless each of the following conditions is fulfilled (or waived
under clause 2.3):
(a) the Offer Document being lodged with ASIC on or before 9.00am on
the Lodgement Date in a form and substance satisfactory to the
Underwriters (acting reasonably);
(b) the investigations conducted in accordance with the Due Diligence
Program being completed to the satisfaction of the Joint Lead
Managers (acting reasonably) on or before 9.00am on the Lodgement
Date;
(c) delivery of the Due Diligence Report to the directors of the
Responsible Entity in a form and substance satisfactory to the
Underwriters and signed by each member of the Due Diligence
Committee on or before 9.00 am on the Lodgement Date; and
(d) receipt by each member of the Due Diligence Committee of adviser's
reports and opinions referred to in Attachment 4 of the Planning
Memorandum on or before 9.00 am on the Lodgement Date.
2.2 Obligations to satisfy conditions
The Responsible Entity must use its best endeavours to satisfy the
conditions referred to in clause 2.1.
2.3 Waiver
The Underwriters alone may waive any or all of the conditions referred
to in clause 2.1 by giving notice in writing to the Responsible Entity
to that effect.
2.4 Failure to fulfil condition precedent
If the conditions referred to in clause 2.1 are not fulfilled (or waived
under clause 2.3) by the time specified in that condition or such later
time (as agreed by the Underwriters) then
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9.
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this agreement (other than clauses 4.6, 9, 13, 14, 15, 16 and 17(except
17.2) is at an end as to its future operation except for the enforcement
of any right or claim which arises on or has arisen before this
agreement comes to an end.
3. APPOINTMENT AND OBLIGATION TO UNDERWRITE
3.1 Appointment
The Responsible Entity appoints the Underwriters as the underwriters of
the Offer on the terms and conditions of this agreement and the
Underwriters accept that appointment.
3.2 Agreement to underwrite
The Underwriters agree to underwrite:
(a) subscriptions of the Initial Instalment for the Offer Securities;
and
(b) payment of the Final Instalment on the Allotted Units,
on the terms and conditions of this agreement.
3.3 Agreement to manage
The Underwriters agree to act as joint lead managers and bookrunners of
the Offer and assist the Responsible Entity, in a professional and
diligent manner, in the successful conduct of the Offer.
3.4 Several obligations
The obligations of each of the Underwriters under clause 3.2 to
underwrite:
(a) subscriptions of the Initial Instalment for the Offer Securities;
and
(b) payment of the Final Instalment on the Allotted Units,
shall be several and not joint, with each Underwriter being obliged to
underwrite subscriptions for 50% of the Shortfall Amount and 50% of the
Unpaid Instalment Amount.
3.5 Sub-underwrite
The Underwriters may at any time appoint sub-underwriters to
sub-underwrite subscriptions for the Offer Securities.
4. WARRANTIES, UNDERTAKINGS AND INDEMNITIES
4.1 Validity of agreement
Each party, in respect of itself, represents and warrants to each other
party each of the matters set out in part 1 of schedule 2.
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10.
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4.2 Responsible Entity
The Responsible Entity represents, warrants and undertakes to the
Underwriters each of the matters set out in part 2 of schedule 2.
4.3 Independent
Each of the paragraphs set out in schedule 2 shall be construed
independently and no paragraph shall be limited by implications arising
from any other paragraphs.
4.4 Undertaking
(a) Each of the Responsible Entity and ROP undertakes to the
Underwriters that it will notify the Underwriters immediately if
it becomes aware of a breach of any representation or warranty
under clause 4.1 relating to it, and of any representation or
warranty under clause 4.2.
(b) Each of the Underwriters undertakes to the Responsible Entity and
ROP that it will notify the Responsible Entity and ROP immediately
if it becomes aware of a breach of any representation or warranty
under clause 4.1 relating to it.
4.5 Repetition
Each representation and warranty given by a party under this clause 4
shall be deemed to have been repeated by that party on each day before
the Allotment Date and on the Allotment Date and on each day before the
Instalment Shortfall Sale Date and on the Instalment Shortfall Sale Date
as if made with respect to the facts and circumstances then existing.
4.6 Indemnity
Each of the Responsible Entity and ROP indemnifies each of the
Indemnified Parties on the terms and conditions set out in schedule 3.
4.7 Survival
The representations, warranties and indemnities given by a party under
this agreement shall not merge upon completion of the transactions
contemplated by this agreement.
4.8 Reliance
Each party acknowledges that the others are entering into this agreement
in reliance on the representations, warranties and undertakings in this
clause 4.
4.9 Cessation of ROP liability
ROP ceases to be liable for any Claims that may be made against it under
this agreement after the third anniversary of the date of this
agreement. Nothing in this clause affects the rights of the Underwriters
to make Claims against the Responsible Entity.
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11.
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5. OFFER
5.1 Making of Offer
Subject to clause 5.3, the Responsible Entity must offer the Offer
Securities for subscription in accordance with this agreement, the Offer
Document, the Timetable, the Scheme Constitution, the Listing Rules, the
Corporations Act and all other applicable laws.
5.2 Amendment
The Timetable may be amended by the Responsible Entity with the consent
of:
(a) the Underwriters; and
(b) ASX, if required by the Listing Rules or the Corporations Act.
5.3 Withdrawal of the Offer
The Responsible Entity may withdraw or not proceed with the Offer.
Nothing in this clause affects the Underwriters' right to terminate
their obligations under this agreement under clause 10.1(a)(x) of this
agreement.
5.4 Application for quotation
The Responsible Entity must within the time required by section 1013H of
the Corporations Act apply for:
(a) the Trust to be admitted to the official list of ASX; and
(b) the Offer Securities to be granted official quotation on ASX,
and thereafter use its best endeavours to procure that the Trust is
admitted to the official list of ASX and official quotation is granted
to the Offer Securities by the Allotment Date.
5.5 Supplementary Offer Document
Without prejudice to the Underwriters' rights under clause 9, if before
the Allotment Date:
(a) there is a misleading or deceptive statement in the Offer Document
or any Supplementary Offer Document; or
(b) there is an omission from the Offer Document or any Supplementary
Offer Document of material required by the Corporations Act to be
included; or
(c) there is a new circumstance that:
(i) has arisen since the Offer Document or any Supplementary
Offer Document was lodged; and
(ii) would have been required by the Corporations Act to be
included in the Offer Document or Supplementary Offer
Document if it has arisen before the relevant document was
lodged,
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12.
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the Responsible Entity must immediately notify the Underwriters of that
statement, omission or circumstance and must lodge a Supplementary Offer
Document (in a form approved in writing by the Underwriters, such
approval not to be unreasonably withheld or delayed) in respect of that
statement, omission or circumstance as soon as practicable afterwards
and otherwise comply with the Corporations Act. Following the lodgement
of any Supplementary Offer Document the Responsible Entity must
immediately take all action in respect of the Supplementary Offer
Document as may reasonably be required by the Underwriters (including
publication of the Supplementary Offer Document in a national newspaper
and dispatching copies of the Supplementary Offer Document to all
recipients of the Offer Document).
5.6 No other Supplementary Offer Document
Other than pursuant to clause 5.5, the Responsible Entity must not lodge
or reissue a Supplementary Offer Document without the prior written
consent of the Underwriters (such consent not to be unreasonably
withheld or delayed).
5.7 Warranties about Supplementary Offer Document
The warranties given by the Responsible Entity and ROP under clause 4 in
relation to the issue and contents of the Offer Document and conduct
relating to the Offer shall apply equally to any Supplementary Offer
Document.
6. CONDUCT OF OFFERS
6.1 Support and access
The Responsible Entity and ROP must provide the support of, and access
to, the senior executives of the Responsible Entity and ROP to the
extent reasonably required by the Underwriters in the appointment of any
sub-underwriters and in marketing of the Offer, including providing
advanced copies of drafts of the Offer Document to the Underwriters for
distribution (with the prior approval of the Responsible Entity ) to
prospective sub-underwriters and Institutional Investors and a marked
copy of the lodged version of the Offer Document showing all changes
from the draft provided by the Underwriters to prospective
sub-underwriters and Institutional Investors.
6.2 Applications
Each application for Offer Securities must be made on an Application
Form or be an Institutional Application.
6.3 Notification of Applications
(a) Subject to paragraph (b) and (c), the Responsible Entity must
notify the Underwriters once every Business Day of:
(i) the number of Applications (and the number of Offer
Securities to which those Applications relate) received on
the previous Business Day;
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13.
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(ii) the number of Applications received on the previous Business
Day which are not Valid Applications and the grounds on
which the Responsible Entity believes the Application is not
valid;
(iii) the identity of the persons from whom an Application has
been received on the previous Business Day; and
(iv) the aggregate of the Initial Instalments received from each
applicant on the previous Business Day.
(b) Clause 6.3(a) does not apply in respect of Applications which are
processed electronically by Participating Brokers via the delivery
versus payment system. In this case, the Responsible Entity must
only notify the Underwriters once every Business Day of the
aggregate number of Applications (and the aggregate number of
Offer Securities to which those Applications relate) which were
processed electronically by each Participating Broker via the
delivery versus payment system on the previous Business Day.
(c) Clause 6.3(a) and (b) only apply to Applications which are not
Institutional Applications.
(d) The Underwriters have the right to review Applications which are
not Valid Applications.
6.4 Acceptance of Applications
(a) Subject to paragraph (b) the Responsible Entity must accept each
Valid Application for Offer Securities which it is taken to have
received.
(b) The Responsible Entity is not required to accept Applications for
Offer Securities under subparagraph (a) which exceed the number of
Offer Securities available once the Offer Amount is determined or
where the acceptance of the relevant Application would be contrary
to the allocation policy set out in the Offer Document.
6.5 Nomination of Allottees
The Responsible Entity acknowledge that the Underwriters, after
consultation with the Responsible Entity, have the right to nominate the
allottees of all Offer Securities in their absolute discretion subject
to complying with the allocation policy set out in the Offer Document.
6.6 Allotment of Offer Securities
The Responsible Entity must allot and issue the Offer Securities (which
are not Institutional Offer Securities) in respect of which it is taken
to have received Valid Applications on the Allotment Date in accordance
with the allotment procedure described in the Offer Document.
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14.
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6.7 Holding Statements
The Responsible Entity must dispatch a new holding statement in respect
of the Offer Securities issued pursuant to the Offer in accordance with
the Corporations Act and the Listing Rules as soon as practicable.
6.8 Prompt Banking of Cheques
The Responsible Entity must promptly bank for collection all cheques
accompanying Applications received by it. The Responsible Entity must at
its cost arrange for payments to be cleared (or, if clearance is to be
refused, for that to occur) by the relevant financial institutions on
which the payment is drawn.
6.9 Initial Instalment
The Responsible Entity must comply with section 1017E of the
Corporations Act in respect of the Initial Instalment received by it in
respect of any Offer Security.
6.10 Records
The Responsible Entity must maintain (and permit the Underwriters to
inspect at any reasonable time) accurate records of the receipt of
Applications, the banking of the Initial Instalments received by it, the
processing of Applications and the dispatch of holding statements in
respect of the Offer Securities issued pursuant to the Offer.
6.11 Relief of Liability
All Valid Applications which the Responsible Entity is taken as having
received will go towards relieving the liability of the Underwriters
under this agreement to underwrite subscriptions of the Initial
Instalment for the Offer Securities.
6.12 No Shortfall
If by 5:00pm on the Closing Date, Valid Applications are taken to have
been received by the Responsible Entity in respect of that number of
Offer Securities which if issued at the Issue Price would raise the
Offer Amount, the Underwriters' liability under this agreement to
underwrite subscriptions of the Initial Instalment for the Offer
Securities is extinguished.
7. SHORTFALL AND ALLOTMENT
7.1 Notice of Shortfall Securities
If, as at 5:00pm on the Closing Date, the Responsible Entity has not
received Valid Applications in respect of all of the Allotted Units, the
Responsible Entity must by 5:00pm on the Shortfall Notification Date (or
such longer period agreed in writing by the Underwriters), give a
written notice to the Underwriters (the Shortfall Notice) specifying the
number of Allotted Units in respect of which Valid Applications have not
been received (Shortfall Securities).
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15.
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7.2 Certificate to accompany notice
The Responsible Entity must give a Certificate to the Underwriters by
5:00pm on the Business Day before the Settlement Date. The obligations
of the Underwriters under clause 7.5 are subject to and conditional on,
the Responsible Entity delivering such Certificate to the Underwriters.
7.3 Certificate Representations and Warranties
The Responsible Entity represents and warrants in giving the Certificate
that:
(a) the Shortfall Notice specifying the number of Allotted Units for
which Valid Applications were not received is true and accurate as
at the date of the Shortfall Notice; and
(b) the Certificate delivered to the Underwriters shall be true and
accurate in respect of events and circumstances applicable as at
the Closing Date,
and the Responsible Entity further undertakes to notify the Underwriters
of any change in a material respect in any of the matters set out in the
Certificate as soon as practicable after such change becomes known to
the Responsible Entity if such change occurs before the extinguishment
of the Underwriters' liability under this agreement.
7.4 Facilitation of settlement
The Responsible Entity must do, and must cause its security registrar to
do, everything required on its or the registrar's part to facilitate
settlement of the Allotted Units occurring on a delivery versus payment
basis through CHESS on the Settlement Date, and must appoint the
Underwriters (or their nominee) as the Responsible Entity's agent to act
on its behalf in relation to such settlement.
7.5 Requirement to pay
Unless:
(a) this document has been rescinded or terminated under clause 2 or
in accordance with clause 10 before 10:00am on the Settlement
Date; or
(b) the Responsible Entity has not complied with its obligations under
clause 7.2,
each Underwriter must on or before 10:00am on the Settlement Date:
(a) pay to the Responsible Entity, or procure payment to the
Responsible Entity, of 50% of the Institutional Proceeds; and
(b) subscribe, or procure subscription of, 50% of the Shortfall Amount
for 50% of the Shortfall Securities,
(less any amount which the Underwriters are entitled to set off at that
time under clause 9.4).
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16.
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7.6 Liability Extinguished
Upon clause 7.5 being complied with by an Underwriter, the liability of
that Underwriter under this agreement with respect to underwriting
subscriptions of the Initial Instalment for the Offer Securities shall
cease and be extinguished.
7.7 Allotment of Securities
Not later than 1 Business Day after the date on which the Responsible
Entity receives:
(a) the Institutional Proceeds in accordance with clause 7.5; and
(b) subscription of the Shortfall Amount for the Shortfall Securities
in accordance with clause 7.5,
the Responsible Entity must allot the Institutional Offer Securities and
the Shortfall Securities to the subscribers for those Institutional
Offer Securities and Shortfall Securities, as directed by the
Underwriters.
8. FINAL INSTALMENT
8.1 Request for Payment of Final Instalment
The Responsible Entity must ensure that payment of the Final Instalment
is requested from the holders of the Units by the Call Date and in
accordance with the Timetable and in compliance with the Offer Document,
the Scheme Constitution, the Listing Rules, the Corporations Act and all
other applicable laws.
8.2 Notice of Unpaid Instalments
Not later than 7 Business Days after the Instalment Payment Date, the
Responsible Entity must give a written notice to the Underwriters (the
Unpaid Instalment Notice) specifying:
(a) the number of Allotted Units in respect of which the Final
Instalment has not been received by the Responsible Entity and
which the Responsible Entity proposes to sell under the forfeiture
provisions of the Scheme Constitution (the Instalment Shortfall
Units);
(b) the aggregate amount of the unpaid Final Instalments in respect of
the Instalment Shortfall Units (the amount so specified being the
Unpaid Instalment Amount);
(c) subject to paragraph (d), the proposed date (Instalment Shortfall
Sale Date) for the sale of the Instalment Shortfall Units which
must be through the market operated by ASX and be a date not later
than 6 weeks after the Instalment Payment Date;
(d) if the Responsible Entity must sell the Instalment Shortfall Units
at public auction as required by the Corporations Act (as modified
by any ASIC instrument), the Responsible Entity must use its best
endeavours to organise a public auction to be held as soon as
practicable and no later than 6 weeks after the Instalment Payment
Date and must in the Unpaid Instalment Notice give the
Underwriters notice of the
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17.
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date, place and time of the public auction (in which case such
date will be the Instalment Shortfall Sale Date).
For the avoidance of doubt, the reference to Allotted Units in
subparagraph (a) of this clause is only to those Units which are offered
for subscription under the Offer Document and which are allotted on the
Allotment Date.
8.3 Cancellation of Forfeiture
The Responsible Entity must immediately notify the Underwriters in
writing if at any time before the Instalment Shortfall Sale Date the
forfeiture of an Instalment Shortfall Unit is cancelled in accordance
with the Scheme Constitution and must advise the Underwriters of the
revised number of Instalment Shortfall Units and the revised Unpaid
Instalment Amount. For the purposes of this agreement the number of
Instalment Shortfall Units and the Unpaid Instalment Amount at any time
is the number of Instalment Units and the Unpaid Instalment Amount most
recently advised to the Underwriters under this clause 8.3.
8.4 Certificate to accompany notice
The Responsible Entity must give a Certificate to the Underwriters at
the same time as it gives the Instalment Shortfall Notice under clause
8.2. The obligations of the Underwriters under clause 8.5 are subject to
and conditional on the Responsible Entity delivering the Certificate to
the Underwriters.
8.5 Underwriting of Instalment Shortfall Units
Subject to the Responsible Entity satisfying its obligations under
clause 8.1, 8.2 and 8.4, unless this agreement has been rescinded or
terminated under clause 2 or clause 10 on or before the Instalment
Shortfall Sale Date, each Underwriter must:
(a) place offers through SEATS for 50% of the Instalment Shortfall
Units (credited with the Final Instalment as paid) at a price at
least equal to the Final Instalment for each such Instalment
Shortfall Unit; or
(b) attend the public auction and there offer to purchase, and
purchase (in cleared funds) if the offer is accepted, 50% of all
the Instalment Shortfall Units (credited with the Final Instalment
paid) for an amount at least equal to the Final Instalment for
each such Instalment Shortfall Unit,
as the case may be.
8.6 Liability of the Responsible Entity
(a) The parties acknowledge it is possible that an Underwriter may
purchase an Instalment Shortfall Unit under clause 8.5 at a price
which is more than the Market Price of the Unit (in respect of
which the Final Instalment has been paid).
(b) For the purposes of rule 6.16 of the Scheme Constitution, the
Responsible Entity is liable to an Underwriter in respect of each
Unit purchased by that Underwriter in accordance with clause 8.5
at a price which is more than the Market Price for the
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18.
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Unit (in respect of which the Final Instalment has been paid or
credited) for an amount equal to the difference between:
(i) the Market Price of the Unit (in respect of which the Final
Instalment has been paid); and
(ii) the price paid by the Underwriter for the Unit up to a
maximum of the amount of the Final Instalment.
8.7 Notification of assignment of rights
Where an Underwriter purchases the Instalment Shortfall Units under
clause 8.5 at a price per Unit which is more than the Market Price of a
Unit (as contemplated by clause 8.6) the Underwriter may, within 15
Business Days of the purchase under clause 8.5, notify the Responsible
Entity that it requires the Responsible Entity to assign some or all of
its rights against former holders of the Units to that Underwriter under
rule 6.16 of the Scheme Constitution and if the Underwriter does not
notify the Responsible Entity in accordance with this clause, the
Responsible Entity's liability to that Underwriter under clause 8.6
shall cease on the expiry of that 15 Business Day period.
8.8 Assignment of rights
Upon receipt of a notice under clause 8.7, the Responsible Entity must:
(a) assign (at law) to that Underwriter such of its rights against the
former holders of the Units under rule 6.16 of the Scheme
Constitution as are specified in the notice and upon doing so the
Responsible Entity's liability to that Underwriter under clause
8.6 ceases; and
(b) give to that Underwriter all such assistance as is necessary to
enable the Underwriter to enforce those rights.
8.9 Liability extinguished
Upon clause 8.5 being complied with by an Underwriter or the Responsible
Entity failing to provide an Unpaid Instalment Notice or Certificate in
accordance with clause 8.2 or 8.4, the liability of that Underwriter
under this agreement with respect to underwriting the payment of the
Final Instalment on the Allotted Units shall cease and be extinguished.
9. FEES, COSTS AND EXPENSES
9.1 Payment of fees
(a) Subject to clause 9.3 and the relevant Underwriter complying with
clause 7.5, the Responsible Entity must pay to each Underwriter on
the Settlement Date:
(i) an underwriting fee of 1.25% of the Initial Offer Proceeds;
and
(ii) a management fee of 0.25% of the Initial Offer Proceeds.
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19.
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For the avoidance of doubt, the total of such fees is 3.0% of the
Initial Offer Proceeds which is shared equally between the Underwriters.
(b) Subject to clause 9.3 and the relevant Underwriter complying with
8.5, the Responsible Entity must pay to each Underwriter on the
Instalment Shortfall Sale Date:
(i) an underwriting fee of 1.25% of the Instalment Proceeds; and
(ii) a management fee of 0.25% of the Instalment Proceeds.
For the avoidance of doubt, the total of such fees is 3.0% of the
Instalment Proceeds which is shared equally between the Underwriters.
(c) The Responsible Entity must pay to the Underwriters on the
Settlement Date a fee of 1.5% of the amount calculated by
multiplying the Issue Price by the number of Offer Securities
allotted pursuant to Application Forms from retail investors
bearing the stamp of a Participating Broker (which may be the
Underwriter or a related body corporate) or a member of the
Financial Planning Association, which fee shall be paid by the
Underwriter to the relevant Participating Broker or member of the
Financial Planning Association whose stamp appears on the
Application Form.
(d) The Underwriters must pay any sub-underwriting fees out of the
fees payable to them under paragraph (a) and are not entitled to
be reimbursed or indemnified for such fees, whether under clause
4.6 or 9.2 or otherwise.
9.2 Costs and expenses
In addition to the fees referred to in clause 9.1, the Responsible
Entity must on receipt of notice from the Underwriters, pay or procure
the payment to the Underwriters (or as it directs) of all reasonable
travel and out-of-pocket expenses incurred by the Underwriters in
relation to the Offer, and all other reasonable costs, expenses and
disbursements of the Underwriters in relation to the Offer, and
reasonable legal costs and disbursements on a full indemnity basis
incurred by the Underwriters in relation to the Offer including costs
and disbursements incurred in the preparation and execution of this
agreement.
9.3 Costs on termination
In the event that the obligations of the Underwriters under this
agreement are terminated pursuant to clause 2 or 10 or the Offer does
not proceed or is not completed for any reason:
(a) the Responsible Entity shall not be obliged to pay to the
Underwriters the fees referred to in clause 9.1; and
(b) except where the termination or failure of the Offer to proceed is
solely due to a wrongful act by the Underwriters, the Responsible
Entity shall be obliged to pay to the Underwriters within five
Business Days of termination of the obligations of the
Underwriters, or the Offer not proceeding or completing (to the
extent that it has
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20.
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not already done so), the costs, expenses and disbursements
referred to in clause 9.2.
9.4 Set off
The Underwriters may at any time set off against the amount payable by
them to the Responsible Entity under clause 7.5 or clause 8.5, the
amounts payable to them by the Responsible Entity under clause 9.1, 9.2
or 9.3. To the extent the obligations of the Responsible Entity under
those clauses are not fully satisfied by such application the
Responsible Entity will not be relieved of its obligations under those
clauses. The Underwriters must give prior written notice to the
Responsible Entity of any amount set off by the Underwriters pursuant to
this clause 9.4.
10. EVENTS OF TERMINATION
10.1 Right of termination
Subject to clause 10.2, if any one or more of the following events
occurs at any time in the period from (and including) the date of this
agreement to the time the Allotted Units are issued on the Allotment
Date (or, in the case of a paragraph which specifies a particular
period, from (and including) the date of this agreement to (and
including) the date or period referred to in the relevant paragraph),
then at any time on or before the time the Allotted Units are issued on
the Allotment Date (or the particular period specified) an Underwriter
may terminate any of its obligations under this agreement which have not
been performed at that time (without cost or liability to itself) by
notice in writing to the Responsible Entity (with a copy to the other
Underwriter) specifying the relevant event:
(a) (i) (index change) a Relevant Index either:
(A) falls 15% or more below its Starting Level and remains
15% or more below the Starting Level for 2 or more
consecutive Business Days; or
(B) falls 15% or more below its Starting Level on a day
which is less than 2 Business Days before the
Allotment Date and remains 15% or more below the
Starting Level on each subsequent Business Day until
the Allotment Date;
(ii) (Reckson Associates):
(A) Reckson Associates is or becomes insolvent;
(B) NYSE suspends quotation of the shares of common stock
in Reckson Associates for 2 or more consecutive NYSE
Trading Days or Reckson Associates ceases to be listed
on NYSE;
(iii) (ASIC stop order):
(A) ASIC gives notice of an intention to hold a hearing or
issues an order or interim order under section
1020E(2) or 1020E(5) of the Corporations Act or ASIC
applies for an order under sections
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21.
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1324B or 1325 of the Corporations Act in relation to
the Offer Document, or gives notice of an intention to
prosecute the Responsible Entity or any of its
directors unless such notice or order has not become
public and is withdrawn by the end of the second
Business Day after it is given or made but in any
event by no later than 7 Business Days before the
Closing Date;
(B) an application is made by ASIC for an order under Part
9.5 of the Corporations Act in relation to the Offer
Document or ASIC commences an investigation or hearing
under Part 3 of the Australian Securities and
Investments Commission 1989 (Cth) in relation to the
Offer Document unless such application has not become
public and is withdrawn by the end of the second
Business Day after it is given or made but in any
event by no later than 7 Business Days before the
Closing Date;
(iv) (ASX approval) unconditional approval (or conditional
approval, provided such condition would not, in the
reasonable opinion of the Underwriters, have a material
adverse effect on the success or settlement of the Offer) by
the ASX for the admission of the Trust to the official list
of ASX and for official quotation of the Allotted Units is
refused, or is not granted before the Settlement Date (or
such later date agreed in writing by the Underwriters in
their absolute discretion) or is withdrawn on or before the
Settlement Date;
(v) (consent) any person (other than the Underwriters) whose
consent to the issue of the Offer Document is required by
the Corporations Act refuses to give their consent or having
previously consented to the issue of the Offer Document
withdraws such consent unless such withdrawn consent is
reinstated by the end of the second Business Day after it is
withdrawn but in any event by no later than 7 Business Days
before the Closing Date;
(vii) (Lodgement) the Responsible Entity fails to lodge the Offer
Document with ASIC on or before the Lodgement Date (or such
later date approved in writing by the Underwriters);
(viii) (Certificate) a Certificate which is required to be
furnished by the Responsible Entity under this agreement is
not furnished when required or a statement in that
Certificate is untrue, incorrect or misleading in a material
respect;
(ix) (Timetable) any event specified in the Timetable is delayed
for more than 2 Business Days without the prior written
consent of the Underwriters;
(x) (withdrawal) the Responsible Entity withdraws the Offer
Document, any Supplementary Offer Document or any part of
the Offer without the consent of the Underwriters;
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22.
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(xi) (material adverse change) a material adverse change occurs
or becomes known in the financial position, results of
operations or prospects of the Responsible Entity, Reckson
Associates or the Trust;
(xii) (supplementary offer document):
(A) a Supplementary Offer Document must, in the reasonable
opinion of the Underwriters, be lodged with ASIC under
the Corporations Act because the Offer Document is or
becomes defective within the meaning of section
1021B(1) of the Corporations Act;
(B) a Supplementary Offer Document is lodged with ASIC
because the Offer Document is or becomes defective
within the meaning of section 1021B(1) of the
Corporations Act; or
(C) the Responsible Entity lodges a Supplementary PDS
without the written consent of the Underwriters;
(b) (i) (misrepresentation or breach) a representation or warranty
made or given or deemed by clause 4.5 to have been made or
given by the Responsible Entity or ROP under this agreement
proves to be, or has been, or becomes, untrue or incorrect;
(ii) (breach) the Responsible Entity or ROP fails to perform or
observe any of its obligations under this agreement;
(iii) (material adverse change in financial markets) there occurs
an adverse change or disruption to the political or economic
conditions or financial markets of Australia, the United
Kingdom, the United States of America or the international
financial markets or any change or development involving a
prospective adverse change in any of those conditions or
markets;
(iv) (unauthorised alterations) without the prior written consent
of the Underwriters, which consent shall not be unreasonably
withheld or delayed, the Responsible Entity alters the
Scheme Constitution;
(v) (compliance) a contravention by the Responsible Entity, ROP
or Reckson Associates of any provision of its constitution,
the Scheme Constitution, the Corporations Act or any
requirement of the ASX or any other applicable law (except
to the extent that compliance with any applicable law has
been waived, or an exemption or modification granted, by a
Government Agency having authority to do so);
(vi) (Director) a director or executive officer of the
Responsible Entity or Reckson Associates:
(A) is charged with an indictable offence relating to any
financial or corporate matter or any regulatory body
commences any public action against the director in
his or her capacity as a director of the
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23.
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Responsible Entity or announces that it intends to
take any such action; or
(B) is disqualified from managing a corporation under
sections 206B, 206C, 206D, 206E, 206F or 206G of the
Corporations Act.
(vii) (change in law in Australia) there is introduced into the
Parliament of the Commonwealth of Australia or any State or
Territory of Australia a law or any new regulation is made
under any law, or a Government Agency, adopts a policy, or
there is a public announcement on behalf of the Government
of the Commonwealth of Australia or any State or Territory
of Australia that such a law or regulation will be
introduced or policy adopted (as the case may be);
(viii) (change in law in United States) there is introduced into
any state legislature or federal congress of the United
States of America a law or any new regulation is made under
any law, or a Government Agency, the United States Federal
Reserve or any United States regulatory authority (whether
state or federal) adopts a policy, or there is a public
announcement on behalf of any state legislature or federal
congress of the United States of America or a Government
Agency, the United States Federal Reserve or any United
States regulatory authority (whether state or federal) that
such a law or regulation will be introduced or policy
adopted (as the case may be);
(ix) (hostilities) hostilities not presently existing commence
(whether war has been declared or not) or a major escalation
in existing hostilities occurs (whether war has been
declared or not) involving any one or more of Australia, New
Zealand, the United States of America, any member of State
of the European Union, Indonesia, Japan or the People's
Republic of China or a significant terrorist act is
perpetrated anywhere in the world;
(x) (trading of securities) trading in all securities:
(A) quoted on ASX is suspended or limited in a material
respect for 1 Business Day (or substantially all of a
Business Day);
(B) quoted on NYSE is suspended or limited in a material
respect for 1 NYSE Trading Day (or substantially all
of an NYSE Trading Day); or
(C) quoted on LSE is suspended or limited in a material
respect for 1 LSE Trading Day (or substantially all of
an LSE Trading Day);
(xi) (banking moratorium) a general moratorium on commercial
banking activities in Australia, the United Kingdom or the
United States of America is declared by the relevant central
banking authority in any of those countries and remains in
force for 2 consecutive business days, or there is a
material disruption in commercial banking or security
settlement
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24.
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or clearance services in any of those countries which
remains in force for 2 consecutive business days;
(xii) (Offer Document) the Offer Document omits any information
required by the Corporations Act, contains a statement which
is misleading or deceptive or otherwise fails to comply with
the Corporations Act; and
(xiii) (material contracts) the Transaction Documents or any other
material contract summarised in the Offer Document is
terminated (whether by breach or otherwise), rescinded,
altered or amended in a material respect without the prior
written consent of the Underwriters (which consent shall not
be unreasonably withheld) or any such contract is found to
be void or voidable or, if any of those Transaction
Documents or any other material contract summarised in the
Offer Document is not signed by the Lodgement Date, it is
agreed that any of them will not be signed or will be signed
in a form which is materially different from the summary or
in a form which is not on terms which are acceptable to the
Underwriters acting reasonably.
10.2 Exercise of rights
No event specified in clause 10.1(b), 10.3(c) or 10.3(e) shall entitle
an Underwriter to exercise its rights to terminate its obligations under
this agreement unless, in the reasonable opinion of that Underwriter,
the event:
(a) has, or is likely to have, a material adverse effect on:
(i) the financial condition, financial position or financial
prospects of the Trust; or
(ii) the market price of the Offer Securities; or
(iii) the success, marketing or settlement of the Offer; or
(b) leads, or is likely to lead:
(i) to a contravention by that Underwriter of, or that
Underwriter being involved in a contravention of, the
Corporations Act or any other applicable law; or
(ii) to a liability for that Underwriter under the Corporations
Act or any other applicable law.
In forming that reasonable opinion the Underwriter will take into
account any remedy or cure which has been effected (in the case of
matters capable of remedy or cure).
10.3 Right of termination after Allotment Date
If any one or more of the following events occurs at any time in the
period from the Allotment Date to 6pm on the Instalment Shortfall Sale
Date an Underwriter may terminate its obligations under this agreement
to underwrite payment of the Final Instalment on the
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25.
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Instalment Shortfall Units (without cost or liability to itself) by
notice in writing to the Responsible Entity specifying the relevant
event:
(a) (suspension) the ASX suspends quotation of the Units for 3 or more
consecutive Business Days or removes the Trust from the official
list of ASX;
(b) (certificate) the Certificate which is required to be furnished by
the Responsible Entity under clause 8.4 is not furnished when
required or a statement in that certificate is untrue, incorrect
or misleading in a material respect;
(c) (breach or contravention) the Responsible Entity, ROP or Reckson
Associates or any director or executive officer of the Responsible
Entity, ROP or Reckson Associates commits any act of fraud,
contravenes the Scheme Constitution or any applicable law or
agreement, fails to perform any obligation under this agreement or
a representation or warranty given by the Responsible Entity or
ROP under this agreement is untrue or incorrect;
(d) (solvency) the Trust, the Responsible Entity or Reckson Associates
is or becomes insolvent;
(e) (material contracts) any of the Transaction Documents or any other
of the material contracts summarised in the Offer Document is
terminated (whether by breach or otherwise), rescinded, altered or
amended in a material respect without the prior written consent of
the Underwriters (which consent shall not be unreasonably
withheld) or is found to be void or voidable;
(f) (responsible entity) the Responsible Entity indicates an intention
to retire as responsible entity of the Trust or ceases to be the
responsible entity of the Trust without the prior written approval
of the Underwriters.
10.4 Claims
Nothing contained in this clause 10 shall prejudice or nullify any Claim
or other right (including under clause 4.6) which the Underwriters or
any other Indemnified Party may have against the Responsible Entity or
ROP, or which the Responsible Entity or ROP may have against the
Underwriters, for or arising out of any breach of covenant, warranty or
representation or failure to observe or perform an obligation under this
agreement.
10.5 Notification
The Responsible Entity must notify the Underwriters in writing
immediately after becoming aware that any of the events referred to in
clause 10.1 or 10.3 has occurred or is about to occur.
10.6 Effect of termination
(a) In the event that an Underwriter (the "Terminating Underwriter")
terminates its obligations under this agreement pursuant to clause
10.1 or 10.3 or refuses to waive fulfilment of a condition under
clause 2.1, it shall thereupon be relieved of its
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obligations under this agreement and shall be entitled to payment
and reimbursement in accordance with clause 9.3.
(b) The exercise by the Terminating Underwriter of its rights upon the
happening of an event specified in clause 10.1 or 10.3 does not
automatically terminate the obligations of the other Underwriter
(the "Remaining Underwriter").
(c) If the Terminating Underwriter gives notice to the Remaining
Underwriter of its intention to terminate its obligations under
this agreement upon the happening of an event specified in clause
10.1 or 10.3 or the Terminating Underwriter refuses to waive
fulfilment of a condition under clause 2.1, the Remaining
Underwriter must elect by notice in writing to the Terminating
Underwriter and the Responsible Entity within 2 Business Days of
the Terminating Underwriter terminating its obligations under this
agreement as a result of that event to:
(i) also terminate its obligations under this agreement; or
(ii) assume the obligations of the Terminating Underwriter under
this agreement.
If the Remaining Underwriter fails to give notice under this clause
10.6(c) it shall be treated as having also terminated its obligations
under this agreement.
(d) If the Remaining Underwriter gives notice under paragraph (c)(ii)
prior to the Settlement Date that it will assume the obligations
of the Terminating Underwriter under this agreement the Remaining
Underwriter in addition to the fees to which it is entitled under
clause 9.1 will also be entitled to the fees that would have been
payable to the Terminating Underwriter under clause 9.1 if it had
not terminated.
(e) If:
(i) an Underwriter terminates its obligations under this
agreement under clause 10.3; and
(ii) the Remaining Underwriter assumes the obligations of the
Terminating Underwriter under clause 10.6(c),
the Remaining Underwriter in addition to the fees to which it is
entitled under clause 9.1 will also be entitled to the fees that
would have been payable to the Terminating Underwriter under
clause 9.1 if it had not terminated.
11. ADVERTISING AND PUBLIC ANNOUNCEMENTS
11.1 Promotion of Offer
The Responsible Entity must at its own cost provide such assistance in
connection with the promotion, advertising and marketing of the Offer as
is reasonably required by the Underwriters from time to time. The
content and other details of any promotional material (which includes
any media advertising and marketing material and the format of any
roadshow presentation) must be agreed between the Responsible Entity and
the Underwriters (such agreement not to be unreasonably withheld or
delayed) prior to any
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27.
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statement or release (provided that nothing in this agreement prevents
the Responsible Entity from making any announcement which it is required
by the Corporations Act or the Listing Rules or any other applicable law
to make).
11.2 Responsibility for promotion
The Responsible Entity is fully responsible for:
(a) the contents of any promotional material relating to the Offer
except where the content of that promotional material has not been
agreed under clause 11.1; and
(b) all announcements and disclosures in respect of the Offer which
have been agreed between the Responsible Entity and the
Underwriters.
11.3 Disclosure
(a) The Responsible Entity agrees that subject to any disclosure
required by the Corporations Act or the Listing Rules or any other
applicable law they must not make any public or media announcement
or disclosure in relation to the Offer, its progress, the result
of the Offer, the Transaction or their underlying business without
the prior approval of the Underwriters which must not be
unreasonably withheld or delayed.
(b) For the avoidance of doubt clause 11.3(a) does not prevent Reckson
Associates making any public or media announcement or disclosure
in relation to the Offer, its progress, the result of the Offer,
the Transaction or its underlying business:
(i) to the extent required by, the operating rules of the NYSE
or any other applicable law; or
(ii) in response questions or requests for information from
investors or media
provided that such disclosure is not inconsistent with the Offer
Document.
12. ACCESS TO INFORMATION
12.1 Access and information
The Responsible Entity agrees to allow the Underwriters and their
officers and advisers reasonable access to their premises, books and
records at all reasonable times (before the Allotment Date or,
thereafter, during the currency of any regulatory or other proceedings
or investigation in connection with the Offer Document or the Offer) to
enable the Underwriters to obtain any information which the Underwriters
reasonably require in relation to the Offer or the Transaction.
12.2 ASX and ASIC
Without limiting the generality of clause 12.1, the Responsible Entity
must promptly give the Underwriters copies of notifications to and
approvals of ASX and ASIC, evidence of any lodging of the Offer Document
and any other similar material relating to the Offer.
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12.3 Due diligence materials
The Responsible Entity must provide the Underwriters with full and free
access to, and on request, copies of, the Due Diligence Report, the
Verification Material and all materials and documents used or created in
connection with the preparation of the Due Diligence Report and the
Verification Material, and must maintain those materials and documents
until the Final Instalment Sale Date, and thereafter for at least six
years from the Final Instalment Sale Date for that purpose.
13. ACKNOWLEDGMENTS
13.1 Acknowledgments
The Responsible Entity and ROP acknowledge that in respect of each
Underwriter:
(a) the Underwriter is not retained to and is not required to give
tax, legal, regulatory, accountancy or other specialist or
technical advice in connection with the Offer;
(b) while the Underwriter will assist in the co-ordination of due
diligence investigations in connection with the Offer, it will
rely on its own expertise and on that of specialist legal,
accounting and tax advisers in respect of that due diligence;
(c) any advice, whether written or oral, given by the Underwriter to
it, or any communications between the Underwriter and the
Responsible Entity or ROP may only be used and relied on by the
Responsible Entity or ROP as the case may be and may not be used
or relied on by any third party and may not be disclosed to any
third party without the prior written approval of the Underwriter
(other than the Responsible Entity's and ROP's professional
advisers who may place no reliance on such advice);
(d) the Underwriter is not obliged to disclose to the Responsible
Entity or ROP, or utilise for the benefit of the Responsible
Entity or ROP, any non-public information which the Underwriter
obtains in the normal course of its business where such disclosure
or use would result in a breach of any obligation of
confidentiality or any internal Chinese Wall policies of the
Underwriter; and
(e) without prejudice to any claim the Responsible Entity or ROP may
have against the Underwriter, no proceedings may be taken against
any director, officer, employee or agent of the Underwriter in
respect of any claim that the Responsible Entity or ROP may have
against the Underwriter; and
(f) it is contracting with that Underwriter on an arms-length basis to
provide the services described in this agreement and the
Underwriter is not assuming any duties or obligations (fiduciary
or otherwise) in respect of it other than those expressly set out
in this agreement.
13.2 Agreements
Each of the Responsible Entity and ROP and each of the Underwriters:
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(a) agree that it is solely responsible for making its own independent
judgements with respect to the Offer; and
(b) confirm that it is not the intention to create a fiduciary
relationship between them.
14. GST
14.1 Definitions
Words defined in the A New Tax System (Goods and Services Tax) Act 1999
(Cth) have the same meaning in this clause.
14.2 GST payable in addition to fees
In addition to paying the fees, costs, expenses and disbursements
referred to in clauses 9.1 and 9.2 (which are exclusive of GST) and in
addition to any other amounts, the Responsible Entity must:
(a) pay to the Underwriters an amount equal to any GST payable on any
supply by the Underwriters under or in connection with this
agreement, without deduction or set-off of any other amount; and
(b) make that payment:
(i) as and when the fees, costs, expenses and disbursements
referred to in clauses 9.1 and 9.2 or other consideration or
part of it must be paid or provided; and
(ii) if later, such later time being not more than 5 Business
Days after a tax invoice has been issued by the
Underwriters,
provided that before that payment is due to be made the
Underwriters have given a tax invoice to the Responsible Entity in
respect of the GST so payable.
14.3 GST on claims and expenses
Without limiting the operation of clause 14.2:
(a) if a payment to satisfy a claim or a right to claim under or in
connection with this agreement (for example, for misleading or
deceptive conduct or for misrepresentation or for a breach of any
warranty or for indemnity or for reimbursement of any cost or
expense) gives rise to a liability to pay GST, the payer must pay,
and indemnify the payee against the amount of that GST; and
(b) if a party has a claim under or in connection with this agreement
for a cost or expense on which that party must pay GST, the claim
is for the cost or expense plus all GST (except any GST for which
that party is entitled to an input tax credit).
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15. NOTICES
15.1 How to give a notice
A notice, consent or other communication under this document is only
effective if it is:
(a) in writing, signed by or on behalf of the person giving it;
(b) addressed to the person to whom it is to be given; and
(c) either:
(i) delivered or sent by pre-paid mail (by airmail, if the
addressee is overseas) to that person's address; or
(ii) sent by fax to that person's fax number and the machine from
which it is sent produces a report that states that it was
sent in full.
15.2 When a notice is given
A notice, consent or other communication that complies with this clause
is regarded as given and received:
(a) if it is delivered or sent by fax:
(i) by 5:00pm (local time in the place of receipt) on a Business
Day - on that day; or
(ii) after 5:00pm (local time in the place of receipt) on a
Business Day, or on a day that is not a Business Day - on
the next Business Day; and
(b) if it is sent by mail - on actual receipt.
15.3 Address for notices
A person's address and fax number are those set out below, or as the
person notifies the sender:
Responsible Entity
Address: Level 25 The Chifley Tower
2 Chifley Square Sydney NSW 2000
Fax number: +612 9293 2912
Attention: Company Secretary
ROP
Address: Reckson Associates Realty Corp., 225 Broadhollow Road
Melville NY 11747-4883, USA
Fax number: + 631 622 6788
Attention: Mr Francis Sheehan
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31.
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UBS
Address: Level 25, Governor Phillip Tower,
1 Farrer Place, Sydney NSW 2000
Fax number: +612 9324 2558
Attention: Chris Madden
Citigroup
Address: Citigroup Centre, 2 Park Street, Sydney NSW 2000
Fax number: +612 8225 5410
Attention: Simon Ranson
16. AMENDMENT AND ASSIGNMENT
16.1 Amendment
This agreement can only be amended, supplemented, replaced or novated by
another agreement signed by the parties.
16.2 Assignment
A party may only dispose of, declare a trust over or otherwise create an
interest in its rights under this agreement with the consent of each
other party.
17. GENERAL
17.1 Governing law
(a) This agreement is governed by the law in force in New South Wales.
(b) Each party submits to the non-exclusive jurisdiction of the courts
exercising jurisdiction in the New South Wales, and any court that
may hear appeals from any of those courts, for any proceedings in
connection with this agreement, and waives any right it might have
to claim that those courts are an inconvenient forum.
17.2 Giving effect to this agreement
Each party must do anything (including execute any document), and must
ensure that its employees and agents do anything (including execute any
document), that any other party may reasonably require to give full
effect to this agreement.
17.3 Waiver of rights
A right may only be waived in writing, signed by the party giving the
waiver, and:
(a) no other conduct of a party (including a failure to exercise, or
delay in exercising, the right) operates as a waiver of the right
or otherwise prevents the exercise of the right;
(b) a waiver of a right on one or more occasions does not operate as a
waiver of that right if it arises again; and
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(c) the exercise of a right does not prevent any further exercise of
that right or of any other right.
17.4 Operation of this agreement
(a) This agreement and the Mandate Letter contain the entire agreement
between the parties and Reckson Associates about its subject
matter. Any previous understanding, agreement, representation or
warranty relating to that subject matter is replaced by this
agreement and the Mandate Letter and has no further effect.
(b) Any right that a person may have under this agreement is in
addition to, and does not replace or limit, any other right that
the person may have.
(c) Any provision of this agreement which is unenforceable or partly
unenforceable is, where possible, to be severed to the extent
necessary to make this agreement enforceable, unless this would
materially change the intended effect of this agreement.
17.5 Inconsistency with other documents
If this agreement is inconsistent with any other document or agreement
between the parties, except as specifically provided this agreement
prevails to the extent of the inconsistency.
17.6 Time is of the essence
Time is of the essence of this agreement.
17.7 Counterparts
This agreement may be executed in counterparts.
17.8 Attorneys
Each person who executes this agreement on behalf of a party under a
power of attorney declares that he or she is not aware of any fact or
circumstance that might affect his or her authority to do so under that
power of attorney.
17.9 Responsible Entity
(a) The Responsible Entity enters into this agreement only in its
capacity as responsible entity of the Trust and in no other
capacity. A liability arising under or in connection with this
agreement can be enforced against the Responsible Entity only to
the extent to which it can be satisfied out of the property of the
Trust out of which the Responsible Entity is actually indemnified
for the liability. This limitation of the Responsible Entity's
liability applies despite any other provision of this agreement
and extends to all liabilities and obligations of the Responsible
Entity in any way connected with any representation or other
conduct related to this agreement.
(b) Any party to this agreement may not sue the Responsible Entity in
any capacity other than as responsible entity in respect of the
Trust, including seeking the
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appointment to the Responsible Entity of a receiver (except in
relation to property of the Trust), a liquidator, administrator or
any similar person.
(c) The provisions of this clause 17.9 will not apply to any
obligation or liability of the Responsible Entity to the extent
that it is not satisfied because under the Scheme Constitution or
by operation of law there is a reduction in the extent of the
Responsible Entity's indemnification out of the assets of the
Trust, as a result of the Responsible Entity's fraud, negligence
or breach of trust.
(d) The Responsible Entity is not obliged to enter into any commitment
or obligation under this agreement unless its liability is limited
in the same manner as in this clause 17.9.
17.10 Indemnities
The indemnities in this agreement are continuing obligations independent
from the other obligations of the Responsible Entity and ROP and
continue after this agreement ends or after a Terminating Underwriter
terminates its obligations under this agreement. It is not necessary for
a party to incur expense or make payment before enforcing a right of
indemnity under this agreement.
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34.
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SCHEDULE 1
CERTIFICATE
To: UBS AG
Citigroup
Attention: Chris Madden (UBS AG)
Simon Ranson (Citigroup)
We hereby certify on behalf of Reckson Australia Management
Limited as the responsible entity for the Reckson New York
Property Trust (the Responsible Entity), that, except as set out
below, the following statements are as at the date of this
certificate, to the best of our knowledge having made due
inquiries of all of the directors of each of the Responsible
Entity, true and not misleading or deceptive:
(a) the conditions set out in clause 2.1 have been satisfied or
otherwise waived by the Underwriters;
(b) the Responsible Entity and ROP have complied with all of
their obligations in respect of the Offer whether arising
under the Underwriting Agreement, the Corporations Act, the
Listing Rules, the Offer Document, the Timetable or
otherwise;
(c) there has not been any breach by the Responsible Entity or
ROP of any of the warranties or representations given or
deemed to be given by the Responsible Entity or ROP in
clause 4 of the Underwriting Agreement;
(d) nothing has occurred which is not described in the Offer
Document that:
(i) has, or is likely to have, a material adverse effect
on:
(A) the financial condition, financial position or
financial prospects of the Trust;
(B) the market price of the Offer Securities; or
(C) the success, marketing or settlement of the
Offer; or
(ii) leads, or is likely to lead:
(A) to a contravention by an Underwriter of, or an
Underwriter being involved in a contravention
of, the Corporations Act or any other applicable
law; or
(B) to a liability for an Underwriter under the
Corporations Act or any other applicable law;
(e) no occasion has arisen for the issue of a Supplementary
Offer Document;
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35.
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(f) the representations and warranties contained in clause 4
(and given by or deemed to be given the Responsible Entity
and ROP are true and correct as at the date of this
certificate in respect of the facts and circumstances
existing as at today; and
(g) no Event of Termination has occurred.
[Set out details of any relevant exceptions]
For the purposes of this Certificate:
(a) "Underwriting Agreement" means the underwriting agreement
for the issue of Offer Securities dated on or about 12
August 2005 between UBS AG, Citigroup and the Responsible
Entity and ROP; and
(b) words and expressions used shall have the meanings ascribed
to them in the Underwriting Agreement.
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36.
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SCHEDULE 2
WARRANTIES
Part 1: The Parties
(a) (status):
(ii) The party is a company limited by shares under (except in
the case of UBS and ROP) the Corporations Act
(iii) Each of UBS and ROP is duly incorporated under the laws of
the place of its incorporation.
(b) (power) The party has full legal capacity and power to enter into
this agreement, and in the case of the Responsible Entity the
Subscription Agreement, and to carry out the transactions that
this agreement and, in the case of the Responsible Entity the
Subscription Agreement, contemplates.
(c) (corporate authority) The party has taken all corporate action
that is necessary or desirable to authorise its entry into this
agreement, and in the case of the Responsible Entity the
Subscription Agreement, and its carrying out the transactions that
this agreement, and in the case of the Responsible Entity the
Subscription Agreement, contemplates.
(d) (Authorisations) The party holds each Authorisation that is
necessary or desirable to:
(i) execute this agreement, and in the case of the
Responsible Entity the Subscription Agreement, and to
carry out the transactions that this agreement, and in
the case of the Responsible Entity the Subscription
Agreement contemplates;
(ii) ensure that this agreement, and in the case of the
Responsible Entity the Subscription Agreement, is
legal, valid, binding and admissible in evidence; and
(iii) enable it to properly carry on its business,
and it is complying with any conditions to which any of these
Authorisations is subject.
(e) (agreement effective) This agreement, and in the case of the
Responsible Entity the Subscription Agreement, constitutes legal,
valid and binding obligations of the party, enforceable against it
in accordance with its terms subject to any necessary stamping or
registration.
(f) (no contravention) Neither the execution of this agreement, and in
the case of the Responsible Entity the Subscription Agreement, nor
the carrying out by the party of
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37.
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the transactions that this agreement, and in the case of the
Responsible Entity the Subscription Agreement, contemplates, does
or will:
(i) contravene any law to which it is subject or any order of
any Government Agency that is binding on it;
(ii) contravene any Authorisation;
(iii) contravene any undertaking or instrument binding on it; or
(iv) contravene its constitution, and in the case of the
Responsible Entity, the Scheme Constitution.
Part 2: The Responsible Entity and ROP
(a) (Offer Document) The Offer Document and the Pathfinder Document:
(i) will comply with all applicable laws, including the
Corporations Act (as varied by any modification of, or any
exemption from, the Corporations Act given by ASIC pursuant
to the Corporations Act);
(ii) unless the Underwriters otherwise consent in writing (acting
reasonably), will be issued in the form initialled by the
Responsible Entity and the Underwriters (and in no other
form);
(iii) will not contain a statement which is misleading or
deceptive and will not be one from which there is an
omission of information required by the Corporations Act;
and
(iv) will not be misleading or deceptive and will not be likely
to mislead or deceive.
(b) (conduct) The Responsible Entity, ROP and Reckson Associates have
not engaged in, and will not engage in, conduct that is misleading
or deceptive or which is likely to mislead or deceive in
connection with the issue of the Pathfinder Document, the Offer
Document, the making of the Offer, the Transaction, or making the
call for the Final Instalment.
(c) (no contravention of disclosure obligations) as from the Allotment
Date, the Responsible Entity will not breach section 674 of the
Corporations Act or any provision of Chapter 3 of the Listing
Rules;
(d) (other material) At the time of publication and at all times on or
before the expiry of the Underwritten Period, any announcements,
advertisements publicity and roadshow materials made or published
by the Responsible Entity, ROP or Reckson Associates or on their
behalf or by a related body corporate (each a "Publication") in
relation to the Offer, the Transaction or making the call for the
Final Instalment shall:
(i) not be misleading or deceptive or be likely to mislead
or deceive; and
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38.
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(ii) comply with all applicable laws,
and the Responsible Entity and ROP must use their best endeavours
to ensure that persons who issue any Publication do likewise.
(e) (opinions and belief) Any statement of opinion or belief contained
in the Pathfinder Document, the Offer Document or in any
Publication shall be truly and honestly held by the person making
the statement, and the maker of the statement shall have
reasonable grounds for holding the opinion or belief.
(f) (future matters) There are reasonable grounds for the making of
all statements contained in the Pathfinder Document, the Offer
Document or any Publication provided by the Responsible Entity,
ROP or Reckson Associates relating to future matters (including,
without limitation, financial forecasts).
(g) (printed copies) As soon as practicable after the Offer Document
is lodged with ASIC, the number of printed copies of the Offer
Document that the Underwriters have notified the Responsible
Entity before the date of the Offer Document will be delivered to
the Underwriters.
(h) (information) All information provided or to be provided to the
Underwriters or their advisers in relation to the Transaction or
the Offer by the Responsible Entity, ROP or Reckson Associates or
on their behalf or by their solicitors, auditors or officers or
any other adviser or consultant or by any expert (as defined in
the Corporations Act) was, or will be when provided in its final
form, true, complete and accurate in all material respects and the
Responsible Entity and ROP will, and will procure that Reckson
Associates will, disclose to the Underwriters all information
material to the making of an informed investment decision in
relation to the Offer Securities.
(i) (due diligence) The Due Diligence Program will be properly
implemented and fully carried out in accordance with the Planning
Memorandum, statements contained in the Offer Document will be
verified by appropriately qualified persons, the Due Diligence
Results will be the results of the investigations described in the
Planning Memorandum and the Verification Material will contain the
material collected to verify the statements made in the Offer
Document (and will be accurate in all material respects).
(j) (ongoing due diligence) The Responsible Entity will continue until
the Allotment Date to conduct the Due Diligence Program in
accordance with the Planning Memorandum.
(k) (winding up) During the Underwritten Period, each of the
Responsible Entity, ROP and Reckson Associates (or any entity
controlled by the Responsible Entity) shall not:
(i) pass any resolution that it be wound up;
(ii) enter into any scheme or composition with or for the
benefit of its creditors;
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39.
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(iii) have a receiver or manager appointed to the whole or
any part of its assets or undertakings;
(iv) permit any breach or default whereby it is liable to
be wound up; or
(v) have an administrator appointed to it; or
(v) do any other act which has analogous effect under the laws
of any jurisdiction having application to it.
(l) (no contravention) None of the Responsible Entity, ROP or Reckson
Associates (and none of their related bodies corporate) has
contravened, and before the expiry of the Underwritten Period none
of them will contravene, in any material respect, any provision of
its constitution, the Scheme Constitution, the Corporations Act
(as varied by any modification of, or exemption from, the
Corporations Act given by ASIC pursuant to section 741 of the
Corporations Act) and any other applicable law or requirement of
ASX (except, in the case of a Listing Rule, where compliance with
that Listing Rule has been waived in writing by ASX or any
agreement binding on it).
(m) (litigation) Except as disclosed in the Offer Document, none of
the Responsible Entity, ROP or Reckson Associates (or any of their
related bodies corporate) is involved in any litigation,
arbitration or administrative proceeding relating to claims or
amounts which are material in the context of the Offer nor, so far
as any of them is aware, is any such litigation, arbitration or
administrative proceeding pending or threatened.
(n) (material contracts) There:
(i) is no contract to which the Responsible Entity, the
Trust, the US REIT, the US LLC or Reckson Associates
(or any of their related bodies corporate) is a party
which is material to the making of an informed
investment decision in relation to the Offer which has
not been disclosed in the Offer Document;
(ii) has not been, and will not be before the expiry of the
Underwritten Period, a breach by the Responsible
Entity, the Trust, the US REIT, the US LLC or Reckson
Associates (or any of their related bodies corporate)
in a material respect of any provision of any contract
which is material to the making of an informed
investment decision in relation to the Offer
Securities;
(o) (Prescribed Occurrence) Except as disclosed in the Offer Document
or with the prior written consent of the Underwriters during the
period commencing on the date of this agreement and ending 90 days
after the Allotment Date, no Prescribed Occurrence will occur in
respect of the Responsible Entity, the Trust, the US REIT or the
US LLC (or any of their controlled entities).
(p) (financial position) Except as disclosed in the Offer Document:
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(i) there has been no occurrence which has or will (either
itself or together with any other occurrence)
materially and adversely affect the value of the Offer
Securities, the financial position, profitability or
prospects of the Responsible Entity, or the Trust, any
of the businesses of the Responsible Entity, or the
Trust or any of the property or assets of the
Responsible Entity or the Trust or any of the property
or assets to be acquired pursuant to the Transaction
by the US LLC, the US REIT, the Responsible Entity or
the Trust; and
(ii) none of the business, assets, liabilities, financial
position or prospects of the Responsible Entity or the
Trust or any of the property or assets to be acquired
pursuant to the Transaction by the US LLC, the US
REIT, the Responsible Entity or the Trust has been
materially and adversely affected by any matter either
financial or otherwise.
(q) (Certificate) The contents of each Certificate given under this
agreement will be true and correct in all material respects as at
the date the Certificate is given.
(r) (no further issues) During the period commencing on the date of
this agreement and ending on the day which is 90 days after the
Allotment Date, none of the Responsible Entity (nor any associated
trust or company raising funds for the use of the Trust), the US
REIT or the US LLC shall make, agree to make or announce any
issues of units or equity securities (as defined in the Listing
Rules) or listed debt securities or any securities convertible
into or exchangeable for any such equity securities or listed debt
securities, without the prior written consent of the Underwriters,
which consent shall not be unreasonably withheld or delayed, other
than the issue of the Offer Securities pursuant to the Offer.
(s) (conduct of business) Until 90 days after expiry of the
Underwritten Period except as contemplated in the Offer Document,
the Responsible Entity and Reckson Associates will carry on the
business of the Trust, the US REIT and the US LLC in the ordinary
course and will not dispose or agree to dispose of, the whole or
any substantial asset or part of the business of the Trust where
that disposal would require approval of holders of Units, without
the prior written consent of the Underwriters.
(t) (licences) The Responsible Entity, Reckson Associates and ROP hold
all licences (including in the case of the Responsible Entity a
licence authorising it to act as responsible entity of the Trust),
permits, Authorisations or consents which are material to the
conduct of the Responsible Entity's or Reckson Associates' or
ROP's business (as it relates to the Trust, the US REIT and the US
LLC) and the business of the Trust and all such licences, permits,
Authorisations and consents are in full force and effect and not
liable to be revoked or not renewed unless otherwise disclosed in
the Offer Document.
(u) (Constitution) The copy of the Scheme Constitution previously
provided to the Underwriters by the Responsible Entity is in all
material respects a true, correct, up to date and complete copy.
- --------------------------------------------------------------------------------
41.
- --------------------------------------------------------------------------------
(v) (trust) The trust created under the Scheme Constitution is a valid
and subsisting trust and there is no proposal to terminate,
reconstitute or resettle that trust and that trust is registered
under Chapter 5C of the Corporations Act.
(w) (Constitution compliance) The Scheme Constitution complies with
the Corporations Act and any other applicable law (except to the
extent the compliance with any applicable law has been waived or
an exemption granted by the ASX or a Government Agency having
authority to do so), the Responsible Entity will comply with the
Scheme Constitution, and the Scheme Constitution will not be
amended in a manner that would:
(i) affect the provisions relating to calls;
(ii) require approval of holders of Units; or
(iii) be reasonably expected to be adverse to the interests
of holders of Units,
before the expiry of the Underwritten Period without the prior
written consent of the Underwriters, which consent shall not be
unreasonably withheld or delayed.
(x) (Responsible Entity) The Responsible Entity has been duly
appointed as the Responsible Entity of the Trust under Chapter 5C
of the Corporations Act and there is no proposal that the
Responsible Entity retires.
(y) (right of indemnity) The Responsible Entity:
(i) has the right to be fully indemnified out of the Trust
in relation to its liabilities under this agreement,
and the right has not been modified, released or
diminished in any way;
(ii) the Trust's assets are sufficient to satisfy that
right in full; and
(iii) has not released or disposed of its equitable lien
over the Trust's assets.
(z) (Offer Securities) The Offer Securities will be validly issued and
allotted free from all liens, charges and other encumbrances
except for the obligation to pay the Final Instalment.
(aa) (Transaction Documents) Each Transaction Document is a legal valid
and binding obligation enforceable in accordance with its terms.
No Transaction Document is voidable or liable to rescission for
any reason and no Transaction Document or its performance
contravenes any applicable law.
(bb) (ASX waivers) The Responsible Entity has been granted all waivers
of the Listing Rules and all declarations and modifications of the
Corporations Act which are required to permit:
(i) the Responsible Entity to make the Offer;
(ii) the Trust to become a listed entity on ASX; and
- --------------------------------------------------------------------------------
42.
- --------------------------------------------------------------------------------
(iii) Reckson Associates and the US LLC to exercise their
rights under the LLC Agreement and the Call Option.
- --------------------------------------------------------------------------------
43.
- --------------------------------------------------------------------------------
SCHEDULE 3
INDEMNITY
1. Indemnity
Subject to paragraph 2 of this schedule 3, the Responsible Entity and
ROP agree to jointly and severally indemnify and keep indemnified the
Underwriters and their related bodies corporate and each of their
directors, officers, employees and advisers (each an "Indemnified Party"
and collectively the "Indemnified Parties") from and against all Losses
directly or indirectly suffered by, or Claims made against, an
Indemnified Party arising out of or in connection with the appointment
of the Underwriters pursuant to this agreement including but not limited
to:
(a) (Offer Documents) the issue of the Offer Document, or the making,
conduct, or settlement of the Offer (including Losses or Claims
arising out of or in connection with the preparation for, or
involvement in, investigations conducted by ASIC in relation to
the issue of the Offer Document or the Offer);
(b) (breach) the Responsible Entity or ROP failing to perform or
observe any of its obligations or undertakings under this
agreement or any other obligations binding on it;
(c) (misrepresentation) any representation or warranty made or given
under this agreement or deemed to have been made or given by the
Responsible Entity or ROP under clause 4.5 of this agreement
proving to have been untrue or incorrect;
(d) (authorised publications) any roadshow presentation, announcement,
advertisement or publicity made or distributed by or on behalf of
an Indemnified Party in relation to the Offer with the prior
approval of the Responsible Entity and ROP;
(e) (generally) any claim that an Indemnified Party has any liability
under the Corporations Act (including sections 1041H and 1041I) or
any other applicable law in relation to the Offer;
(f) (issue) the issue of the Offer Securities; and
(g) (Instalment Shortfall Units) the forfeiture and sale of the
Instalment Shortfall Units,
provided that Losses or Claims the subject of this indemnity shall not
include:
(i) sub-underwriting fees and other fees that are the
responsibility of the Underwriters under clause 9.1 of this
agreement; or
(ii) loss or damage suffered solely as a result of the
Underwriters being required to subscribe for the Shortfall
Securities or pay the Unpaid Instalment Amount.
- --------------------------------------------------------------------------------
44.
- --------------------------------------------------------------------------------
Each of the paragraphs (a) to (g) (inclusive) of this paragraph 1 shall
be construed independently and no paragraph shall be limited by
implications arising from any other paragraph.
2. Extent of indemnity
The indemnity in paragraph 1 of this schedule 3 does not extend to and
shall not be deemed to be an indemnity against Losses suffered by, or
Claims made against, an Indemnified Party unless those Losses or Claims
are finally judicially determined to result primarily from the
negligence, fraud, lack of good faith or wilful misconduct of that
Indemnified Party.
3. Notice
If the Underwriters become aware of any matter in respect of which an
Indemnified Party wishes to claim for indemnification under the
indemnity contained in this schedule 3, the Underwriters must promptly
notify the Responsible Entity and ROP of the substance of that matter.
4. Failure to notify
The failure of the Underwriters to notify the Responsible Entity and ROP
pursuant to paragraph 3 of this schedule 3 shall not release the
Responsible Entity and ROP from any obligation or liability which they
may have pursuant to paragraph 1 of this schedule 3 except that such
liability shall be reduced to the extent to which:
(a) any of the Responsible Entity and ROP has suffered material damage
or material loss; or
(b) the amount the subject of the indemnity under paragraph 1 of this
schedule 3 has increased,
as a result of the failure to so notify.
5. Benefits of indemnity
Each Indemnified Party, whether or not a party to this agreement, shall
be entitled to the benefit of the provisions in this schedule 3 and
these provisions may be enforced on that Indemnified Party's behalf by
the Underwriters.
6. Preservation of rights
Subject to paragraph 2 of this schedule 3, the rights of an Indemnified
Party under this agreement shall not in any way be prejudiced or
affected by:
(a) any approval given by that party in relation to the Offer Document
or any roadshow presentation, announcement, advertisement or
publicity made or distributed in relation to the Offer with the
prior approval of the Responsible Entity and ROP (whether before
or after the date of the Offer Document) (collectively the "Public
Material");
- --------------------------------------------------------------------------------
45.
- --------------------------------------------------------------------------------
(b) any consent to be named in the Public Material;
(c) any knowledge (actual or constructive) acquired by the Indemnified
Party after the date of this agreement of any failure by the
Responsible Entity or ROP to perform or observe any of its
obligations under this agreement;
(d) termination of this agreement under clause 2 or any lawful
termination by the Underwriters of the obligations to underwrite
the Offer under clause 9 of this agreement;
(e) any inaccuracy in any representation or warranty made or deemed to
have been made by the Responsible Entity or ROP under this
agreement; or
(f) any other fact, matter or thing which might otherwise constitute a
waiver of or in any way prejudice or affect any right of an
Indemnified Party.
7. Responsible Entity entitled to defend or institute proceedings
In respect of an Indemnified Claim, the Responsible Entity and ROP
shall, subject to paragraphs 10, 11 and 12 of this schedule 3, be
entitled to defend the Indemnified Claim or institute such legal or
other proceedings in the name of any of the Indemnified Parties and
conduct the same under the sole management and control of the
Responsible Entity or ROP, as the case may be. The Responsible Entity
and ROP must diligently pursue any defence it conducts or any
proceedings it takes under this schedule 3 and must consult with and
keep the Underwriters and any relevant Indemnified Party informed of the
progress of the defence or the prosecution of such proceedings.
8. Separate representation
Notwithstanding paragraph 7 of this schedule 3, where the Responsible
Entity or ROP is conducting a defence of an Indemnified Claim or
proceedings in respect of an Indemnified Claim in the name of an
Indemnified Party, the Indemnified Party may engage its own legal or
other representation and participate in those proceedings but any
reasonable expenses incurred by it in relation to those proceedings
shall only be borne by the Responsible Entity and ROP to the extent that
those expenses are:
(a) incurred prior to the Responsible Entity or ROP taking over
conduct of that proceeding; or
(b) incurred with the prior written authority of the Responsible
Entity or ROP.
9. Obligations of Indemnified Parties
The Indemnified Parties, subject only to paragraph 10 of this schedule
3, must:
(a) take such reasonable action as the Responsible Entity or ROP
requests to avoid, dispute, resist, appeal, compromise or defend
any Indemnified Claim in respect of it;
(b) not settle any Indemnified Claim without the prior written consent
of the Responsible Entity or ROP (such consent not to be
unreasonably withheld);
- --------------------------------------------------------------------------------
46.
- --------------------------------------------------------------------------------
(c) render all reasonable assistance and co-operation to the
Responsible Entity or ROP in the conduct of any legal or other
proceedings in respect of an Indemnified Claim;
(d) do anything reasonably necessary or desirable to ensure that the
Responsible Entity or ROP is subrogated to and enjoys the benefit
of the rights of the Indemnified Parties in relation to any
cross-claims.
The Underwriters shall be under no obligation to the Responsible Entity
in respect of a failure by another Indemnified Party to observe the
provisions of this paragraph 9 of this schedule 3.
10. Conditions precedent to Indemnified Parties' obligations
The Indemnified Parties are under no obligation under paragraph 9 of
this schedule 3 unless at the time the Responsible Entity or ROP
requests any of the Indemnified Parties to take any action:
(a) the Responsible Entity or ROP agrees to indemnify the Indemnified
Parties against all Loss incurred by the Indemnified Parties in
taking the action required, as and when they fall due, including
legal costs and disbursements of its lawyers on a full indemnity
basis and the cost of any involvement of any officers of the
Underwriters at normal commercial rates;
(b) the Indemnified Parties, acting reasonably, form the opinion that
the Responsible Entity or ROP has and will have available funds to
satisfy any of the moneys payable under paragraph 10(a) of this
schedule 3, as and when the same become due for payment; and
(c) if the taking of that action would, in the reasonable opinion of
the Underwriters, lead to a risk of damage to an Indemnified
Party's reputation or standing.
11. No Settlement without consent
The Responsible Entity and ROP must not (without the prior written
consent of the Underwriters) settle, compromise or consent to the entry
of any judgment in relation to any Indemnified Claim unless:
(a) such settlement, compromise or consent does not include a
statement or admission that an Indemnified Party is or was at
fault or culpable, failed to act or contravened any applicable
law; and
(b) the Responsible Entity and ROP obtain an unconditional release of
each Indemnified Party from all liability arising out of such
Indemnified Claim.
- --------------------------------------------------------------------------------
47.
- --------------------------------------------------------------------------------
12. Right to assume control of proceedings
An Indemnified Party has a right at any time to reassume any legal or
other proceedings defended or instituted by the Responsible Entity or
ROP in the name of the Indemnified Party as contemplated by paragraph 7
of this schedule 3 (Reassumed Claim). If an Indemnified Party does this:
(a) it will have the right to conduct the same under its sole
management and control and will have absolute discretion with
regards to the conduct of those proceedings including any decision
to settle, compromise or consent to the entry of any judgment in
relation to any Reassumed Claim the subject of those proceedings
but, in doing so, will act reasonably and consult with and take
account of the views of the Responsible Entity or ROP so far as is
reasonably possible; and
(b) the Responsible Entity and ROP must:
(i) render all reasonable assistance and cooperation to the
Indemnified Party in the conduct of any Reassumed Claim; and
(ii) do anything reasonably necessary or desirable to ensure that
the Indemnified Party is subrogated to and enjoys the
benefits of the rights of the Responsible Entity or ROP in
relation to any cross claims,
except where the taking of that action would, in the reasonable
opinion of the Responsible Entity or ROP, lead to a risk of damage
to the Responsible Entity's or ROP's reputation or standing; and
(c) any agreement by the Responsible Entity or RPO to indemnify that
Indemnified Party under paragraph 10(a) of this schedule 3 in
respect of the relevant legal or other proceedings shall no longer
apply.
Paragraph (c) above shall not affect the operation of the indemnity
under paragraph 1 of this schedule 3.
13. Contractual contribution
If for any reason the indemnities contained in this schedule 3 are
unavailable or insufficient to hold harmless any Indemnified Party
against any Indemnified Claim (other than as a result of the operation
of paragraph 2 of this schedule 3 then the Responsible Entity and ROP
each agree to contribute to the relevant Indemnified Claim in accordance
with paragraphs 14 to 18 of this schedule 3, in all cases to the maximum
extent allowed by law.
14. Proportional contribution
The respective proportional contribution of the Responsible Entity and
ROP (on the one hand) and the Indemnified Parties (on the other hand) in
relation to an Indemnified Claim will be as agreed by the Responsible
Entity, ROP and the Indemnified Parties (and failing agreement as
determined by a court of competent jurisdiction) having regard to the
participation in, instigation of, or other involvement of the
Responsible Entity and ROP on the one hand (in relation to the
proportional contribution of the Responsible Entity and
- --------------------------------------------------------------------------------
48.
- --------------------------------------------------------------------------------
ROP) and the Indemnified Parties on the other hand (in relation to the
proportional contribution of the Indemnified Parties) in the act
complained of. Without limiting the generality of this schedule 3,
regard must be had to the Indemnified Parties' and the Responsible
Entity's and ROP's relative intent, knowledge, access to information and
opportunity to correct any untrue statement or omission.
15. No excess contribution
The Responsible Entity and ROP agree with the Indemnified Parties that
in no event will the Indemnified Parties be required to contribute under
paragraph 14 of this schedule 3 to any Indemnified Claim an aggregate
amount that exceeds the commission and fees paid to the Underwriters
under this agreement.
16. Limit on contribution
The Underwriters acknowledge that the Responsible Entity or ROP may
enter into arrangements which limit the extent to which the Responsible
Entity or ROP may claim against any third party or third parties in
connection with the Offer (a Relevant Limitation). Where any damage or
loss is suffered by the Responsible Entity or ROP for which the
Underwriters would otherwise be jointly and severally liable to the
Responsible Entity or ROP with any third party or third parties, the
extent to which such loss will be recoverable by the Responsible Entity
or ROP from the Underwriters will:
(a) be limited so as to be in proportion to the Underwriter's
contribution to the overall fault for such damage or loss, as
agreed between the parties or, in the absence of agreement, as
finally determined by a court of competent jurisdiction; and
(b) be no more than it would have been had any Relevant Limitation not
been agreed to by the Responsible Entity or ROP.
The degree to which the Underwriters may rely on the work of any such
third party will be unaffected by any Relevant Limitation.
17. Right to reimbursement by the Responsible Entity
If an Indemnified Party pays an amount in relation to an Indemnified
Claim where it is entitled to contribution from the Responsible Entity
or ROP under this schedule 3, the Responsible Entity and ROP agree to
promptly reimburse the Indemnified Party for that amount.
18. Right to reimbursement by the Indemnified Party
If the Responsible Entity or ROP pays an amount in relation to an
Indemnified Claim where it is entitled to contribution from an
Indemnified Party under this schedule 3, the Underwriters agree to
promptly reimburse the Responsible Entity and ROP for that amount.
19. Release of the Indemnified Parties
Each of the Responsible Entity and ROP agree that no Claim may be made
by it against the Indemnified Parties, and each of the Responsible
Entity and ROP unconditionally and
- --------------------------------------------------------------------------------
49.
- --------------------------------------------------------------------------------
irrevocably releases and discharges each Indemnified Party from any
Claim that may be made by it to recover from that Indemnified Party any
Losses suffered or incurred by the Responsible Entity or ROP arising
directly or indirectly as a result of the participation of that
Indemnified Party in the preparation of the Offer Document or in
relation to the making of the Offer, except in relation to matters where
those Losses are finally judicially determined to result primarily from
any the negligence, fraud, lack of good faith or wilful misconduct of
that Indemnified Party (except to the extent that such negligence,
fraud, lack of good faith or wilful misconduct of that Indemnified Party
is induced by, or arises as a result of, an act, omission or advice by
or on behalf of the Responsible Entity or ROP).
- --------------------------------------------------------------------------------
50.
- --------------------------------------------------------------------------------
SCHEDULE 4
TIMETABLE
Lodgement Date - date for lodgement of Offer
Document with ASIC 15 August 2005
Opening Date 29 August 2005
Closing Date 16 September 2005
Shortfall Notification Date 19 September 2005
Settlement Date 20 September 2005
Allotment Date 21 September 2005
Call Date (date by which Call is to be made) 21 August 2006
Final Instalment Payment Date 1 October 2006
Last day for Unpaid Instalment Notice 11 October 2006
Last day for Instalment Shortfall Sale Date 10 November 2006
- --------------------------------------------------------------------------------
51.
- ----------------------------------------------------------------------------------------------------------------------
EXECUTED as an agreement.
SIGNED by RECKSON AUSTRALIA
MANAGEMENT LIMITED as
responsible entity of the Reckson New
York Property Trust:
- ----------------------------------------------------- -----------------------------------------------------
Signature of director Signature of Executive Vice President
/s/ Scott Rechler /s/ Michael Maturo
- ----------------------------------------------------- -----------------------------------------------------
Name Scott Rechler Name Michael Maturo
SIGNED on behalf of RECKSON
OPERATING PARTNERSHIP, L.P.
by RECKSON ASSOCIATES REALTY
CORP., its general partner
By:
/s/ Michael Maturo
- ----------------------------------------------------- -----------------------------------------------------
Michael Maturo
- ----------------------------------------------------- -----------------------------------------------------
SIGNED for UBS AG, AUSTRALIA
BRANCH by its duly authorised officers:
- ----------------------------------------------------- -----------------------------------------------------
Signature of authorised officer Signature of authorised officer
/s/ Russell Cowley /s/ Fergus Horrobin
- ----------------------------------------------------- -----------------------------------------------------
Name Russell Cowley Name Fergus Horrobin
- ----------------------------------------------------------------------------------------------------------------------
52.
- ----------------------------------------------------------------------------------------------------------------------
SIGNED for CITIGROUP GLOBAL
MARKETS AUSTRALIA PTY
LIMITED under power of attorney in the
presence of:
Signature of attorney
/s/ Matthew Greenberger
-----------------------------------------------------
Signature of witness Name Matthew Greenberger
/s/ R. B. B. McCormack
- ----------------------------------------------------- -----------------------------------------------------
Name R. B. B. McCormack Date of power of attorney
53.
- ----------------------------------------------------------------------------------------------------------------------
Exhibit 10.2
CONTRIBUTION AGREEMENT
among
RECKSON OPERATING PARTNERSHIP, L.P.,
certain of its
SUBSIDIARIES
listed on the signature pages hereof,
RECKSON AUSTRALIA OPERATING COMPANY LLC
and
RECKSON AUSTRALIA LPT CORPORATION
Dated as of August 12, 2005
TABLE OF CONTENTS
Page
Section 1. Properties to be Contributed; Permitted Debt;
Responsible Entity Termination; Trigger Events; Schedules....................................3
1.01. Transfer of Properties.........................................................................3
1.02. Additional Components of Properties; Excluded Property.........................................4
1.03. Review Materials...............................................................................4
1.04. Due Diligence..................................................................................4
1.05. Requests for Estoppels and Consents; Certain Provisions Regarding Debt.........................5
1.06. Termination; Surviving Obligations.............................................................6
1.07. Reallocation of Properties and Contributed Interests Among
Tranches; Exclusion of Properties and Contributed Interests.................................6
1.08. Responsible Entity Termination Trigger Event...................................................7
1.09. Revisions to Schedules.........................................................................7
Section 2. Objections to Title............................................................................7
2.01. (a) Title Commitments; Title Policies; Permitted Exceptions....................................7
Section 3. Contribution Consideration....................................................................11
3.01. Consideration.................................................................................11
3.02. Adjustments to Consideration..................................................................12
3.03. Effect of Permitted Debt Holder Refusal of Assumption Consent.................................13
3.04. Certain Transactions at Closing...............................................................13
3.05. Issuance of Interests In Advance..............................................................13
Section 4. The Closing...................................................................................13
4.01. Tranche 1 Closing.............................................................................13
4.02. Tranche 2 Closing.............................................................................14
4.03. Tranche 3 Closing.............................................................................14
4.04. Closings......................................................................................14
4.05. Effect of a Closing Not Occurring.............................................................14
4.06. Dates; Times; Dollars.........................................................................14
Section 5. Representations and Warranties................................................................15
5.01. Contributor Representations and Warranties....................................................15
5.02. Relevant Contributees Representations and Warranties..........................................19
5.03. REIT Representations and Warranties...........................................................20
TABLE OF CONTENTS
(continued)
Page
5.04. (a) Survival of Contributor Representations and Warranties; Modification Thereof..............21
5.05. (a) Indemnification by Contributor; Cap; Basket...............................................21
Section 6. Acknowledgments of the Company................................................................24
6.01. No Prior Representations or Warranties........................................................24
6.02. As-Is.........................................................................................24
6.03. Environmental Matters.........................................................................25
Section 7. Contributor's Obligations as to the Properties................................................25
7.01. Operation of Properties Prior to Closing......................................................25
7.02. Certain Lease/Service Contract Actions........................................................25
7.03. Certain Prohibited Actions....................................................................26
7.04. Maintenance of Insurance......................................................................26
7.05. Required Tenant Estoppels; Contributor Estoppel...............................................26
7.06. Landlord Estoppels............................................................................27
7.07. Required Consents.............................................................................27
7.08. Termination of Existing Property Management Agreements........................................27
7.09. Compliance With Permitted Debt Loan Documents.................................................27
7.10. Cooperation Regarding Financing...............................................................28
7.11. Assignment of Environmental Insurance Policy..................................................28
Section 8. Destruction, Damage or Condemnation...........................................................28
8.01. (a) Condemnation..............................................................................28
Section 9. Additional Covenants of Contributor...........................................................29
9.01. Access........................................................................................29
Section 10. Conditions Precedent to Closing...............................................................29
10.01. Conditions Precedent to Company Obligations...................................................29
10.02. Conditions Precedent to Contributor Obligations...............................................30
10.03. Effect of Contributor's Failure to Meet Conditions............................................31
Section 11. Contributor's Closing Deliveries..............................................................32
11.01. Contributor Closing Deliveries................................................................32
11.02. Delivery at Appropriate Closing; Modified Deliverables Required By
Third Parties; Modification of Deliveries Regarding Entity Transfers.......................34
-3-
TABLE OF CONTENTS
(continued)
Page
Section 12. The Company's Closing Deliveries..............................................................35
12.01. Company Deliveries............................................................................35
Section 13. Apportionments; Closing Costs.................................................................36
13.01. General Apportionments........................................................................36
13.02. Adjustment of Taxes...........................................................................37
13.03. Credits.......................................................................................37
13.04. Tenant Arrearages.............................................................................38
13.05. Additional Rent...............................................................................39
13.06. Closing Statements............................................................................39
13.07. Subject to the other provisions of this Section 13, the
following shall apply to closing costs:.....................................................39
Section 14. Failure of Contributor or the Company to Perform..............................................40
14.01. Company Default/Breach Prior to Closing.......................................................40
14.02. Contributor Default/Breach Prior to Closing...................................................40
14.03. Termination of Agreement Regarding Aggregation of Title, Survey,
Closing Condition, Condemnation and Casualty Events........................................41
Section 15. Broker........................................................................................41
15.01. Broker Representation and Warranty; Indemnification...........................................41
Section 16. Notices.......................................................................................41
16.01. Method of Notification and Delivery...........................................................41
Section 17. Miscellaneous Provisions......................................................................43
17.01. Assignment or Transfer........................................................................43
17.02. Integration Clause............................................................................43
17.03. Amendments....................................................................................43
17.04. Governing Law.................................................................................43
17.05. Captions......................................................................................43
17.06. Successors and Assigns........................................................................43
17.07. Masculine and Feminine Terms..................................................................43
17.08. Schedules and Riders..........................................................................43
17.09. Counterparts..................................................................................43
17.10. No Recordation................................................................................43
-4-
TABLE OF CONTENTS
(continued)
Page
17.11. No Third Party Beneficiaries..................................................................44
17.12. No Offer......................................................................................44
17.13. Jurisdiction; Service of Process..............................................................44
17.14. Further Assurances; Cooperation Regarding Consents............................................44
Section 18. Certain Tax Matters...........................................................................44
18.01. Like-Kind Exchanges...........................................................................44
Section 19. Entity Transfers..............................................................................45
19.01. Transfer of Entity Interests in Lieu of Asset Sale............................................45
Section 20. Certain Provisions Regarding SPE Entities.....................................................46
20.01. SPE Entities..................................................................................46
Exhibits
- --------
Exhibit A. Subsidiaries
Exhibit B. Properties
Exhibit C. Form of Limited Liability Company Agreement
Exhibit D-1. Form of Property Management and Leasing Agreement
Exhibit D-2. Form of Construction Service Agreements
Exhibit D-3. Form of Services Agreement
Exhibit D-4. Form of AM Agreement
Exhibit E. Form of Tenant Estoppel
Exhibit F. Form of Landlord Estoppel
Exhibit G. Intentionally Omitted
Exhibit H. Intentionally Omitted
Exhibit I. Form of Paul, Hastings, Janofsky & Walker LLP Opinion
Exhibit J. Mortgage Loan Application
Exhibit K. Form of License Agreement
Exhibit L. Intentionally Omitted
Exhibit M. Form of Tax Protection Agreement
Exhibit N. Form of Option Agreement
Schedules
- ---------
Schedule 1.01(a) Tranche 1 Properties
Schedule 1.01(b) Tranche 2 Properties
Schedule 1.01(c) Tranche 3 Properties
-5-
Schedule 1.02 Excluded Personal Property
Schedule 1.05(b)(i) Assumed Existing Debt
Schedule 3.01(a)(i) Tranche 1 Contribution Consideration and Sales Price
Schedule 3.01(b)(i) Tranche 2 Contribution Consideration and Sales Price
Schedule 3.01(c)(i) Tranche 3 Contribution Consideration and Sales Price
Schedule 5.01(e)-1 Rent Rolls
Schedule 5.01(e)-2 Other Tenant Information
Schedule 5.01(f) Leases
Schedule 5.01(g) Ground Leases
Schedule 5.01(h) Brokerage Agreements
Schedule 5.01(i) Material Service Contracts
Schedule 5.01(j) Capital Improvement Projects
Schedule 5.01(k) Environmental Reports and Matters
Schedule 5.01(o) Litigation Schedule
Schedule 5.01(p) Outstanding Agreements with Attorneys or Consultants
Schedule 5.01(q) Permitted Debt Loan Documents
Schedule 5.05(a) Special Indemnification Matters
Schedule 7.05 Loan Properties
Schedule 7.07 Required Consents
-2-
INDEX OF DEFINED TERMS
Defined Term Section
- ------------ -------
1031 Exchange................................................................................................18.01
225 High Ridge Property.......................................................................................7.11
Additional Rent. ............................................................................................13.05
Advance Rent..............................................................................................13.01(a)
Agents........................................................................................................1.03
Agreement.................................................................................................Preamble
Aggregate Interests Election................................................................................. 3.05
AM Agreement..............................................................................................Recitals
Approved Loan Documentation................................................................................1.05(d)
Assignments of Ground Leases..............................................................................11.01(q)
Assignments of Leases.....................................................................................11.01(r)
Assumed Existing Debt......................................................................................1.05(b)
Assumed Existing Debt Properties...........................................................................1.05(b)
Assumed Existing Debt Holders..............................................................................1.05(b)
Australian Trust..........................................................................................Recitals
Basket.....................................................................................................5.05(a)
Brokerage Agreements.......................................................................................5.01(h)
Business Days.................................................................................................7.01
Cap........................................................................................................5.05(a)
Cash Portion of the Sales Price ...........................................................................3.01(c)
CC Substitution Event......................................................................................8.01(c)
Closing.......................................................................................................4.04
Closing Date..................................................................................................4.04
Code Witholding Section....................................................................................5.01(n)
Company...................................................................................................Preamble
Condition Failure Threshold...............................................................................10.03(a)
Contributed Equity Value...................................................................................3.01(c)
Contributed Entity...........................................................................................19.01
Contributed Interests......................................................................................1.01(c)
Contributor...............................................................................................Preamble
Contributor Closing Conditions...............................................................................10.01
Contributor Estoppel..........................................................................................7.05
Contributor's Knowledge....................................................................................5.04(a)
Cost to Cure ..............................................................................................2.01(d)
CS Agreements.............................................................................................Recitals
Cure Choice Notice.........................................................................................2.01(c)
Debt Releases..............................................................................................1.05(a)
Defect.....................................................................................................2.01(c)
Defect Property............................................................................................2.01(c)
Defects Notice.............................................................................................2.01(c)
Defect Substitution Event..................................................................................2.01(e)
Defect Threshold...........................................................................................2.01(c)
Defect Threshold Deadline..................................................................................2.01(c)
Defect Threshold Termination Right.........................................................................2.01(c)
DYNA Models................................................................................................2.01(f)
Election to Defend.........................................................................................5.05(d)
Entity Transfer..............................................................................................19.01
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Defined Term Section
- ------------ -------
Environmental Insurance Policy................................................................................7.11
Environmental Reports......................................................................................5.01(k)
Excluded Properties..........................................................................................18.01
Excluded Personal Property ...................................................................................1.02
Excluded Property License Agreements..........................................................................1.02
Existing Debt..............................................................................................1.05(b)
Failed Closing Condition Property.........................................................................10.03(a)
Final Closing Statement......................................................................................13.06
Free Rent Period..........................................................................................13.03(f)
Ground Leases..............................................................................................5.01(g)
Identified Debt............................................................................................1.05(b)
Identified Debt Properties.................................................................................1.05(b)
Interests..................................................................................................3.01(a)
Landlord Estoppel.............................................................................................7.06
Loans......................................................................................................1.05(b)
Loan Properties...............................................................................................7.05
Leases.....................................................................................................5.01(f)
LLC Agreement.............................................................................................Recitals
Losses.....................................................................................................5.05(a)
Major Tenants..............................................................................................5.01(f)
Manager...................................................................................................Recitals
Material Service Contracts.................................................................................5.01(i)
Mortgages..................................................................................................1.05(b)
Mortgage Loan Application..................................................................................1.05(b)
Must Removes...............................................................................................2.01(a)
Notice.......................................................................................................16.01
Option Agreement..........................................................................................11.01(w)
Owner Operating Partnership...............................................................................Preamble
Payoff Debt................................................................................................1.05(b)
Permitted Debt Consents....................................................................................1.05(a)
Permitted Debt.............................................................................................1.05(b)
Permitted Debt Loan Documents............................................................................. 5.01(q)
Permitted Debt Properties..................................................................................1.05(b)
Permitted Debt Holders.....................................................................................1.05(b)
Permitted Exceptions.......................................................................................2.01(a)
Post-Closing Adjustment Period...............................................................................13.06
Portfolio Services Agreements.............................................................................Recitals
Promissory Notes...........................................................................................1.05(b)
Property......................................................................................................1.01
Property Management Agreements............................................................................Recitals
Property Services Agreements..............................................................................Recitals
Properties.................................................................................................1.01(c)
RAML......................................................................................................Recitals
Real Properties............................................................................................1.01(c)
REIT......................................................................................................Preamble
RE Trigger Event .............................................................................................1.08
Relevant Contributee(s)...................................................................................Recitals
Rent Credit...............................................................................................13.03(f)
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Defined Term Section
- ------------ -------
Rent Rolls.................................................................................................5.01(e)
Rep Survival Period........................................................................................5.04(a)
Required Consents.............................................................................................7.07
Required Forms............................................................................................11.01(t)
Responsible Entity........................................................................................Recitals
Review Materials..............................................................................................1.03
Searches...................................................................................................2.01(a)
Securities Act.............................................................................................5.01(t)
Service Contracts..........................................................................................5.01(i)
Services Agreement........................................................................................Recitals
Interests..................................................................................................3.01(a)
SPE Entities..............................................................................................Recitals
Special Indemnification Matters ...........................................................................5.05(a)
Subsidiaries..............................................................................................Preamble
Substitute Ground Lessor Estoppel ..............................................................................7.06
Substitute Property........................................................................................2.01(f)
Survey.....................................................................................................2.01(b)
Surveys....................................................................................................2.01(b)
Surviving Obligations.........................................................................................1.06
Synapse Lease.............................................................................................13.03(f)
Tax Protection Agreement..................................................................................Recitals
Tenant Estoppels..............................................................................................7.05
Third Party Claim..........................................................................................5.05(d)
Title Cap..................................................................................................2.01(a)
Title Commitments..........................................................................................2.01(a)
Title Company..............................................................................................2.01(a)
Title Policies.............................................................................................2.01(a)
Total Consideration........................................................................................3.01(c)
Tranche 1 Permitted Debt...................................................................................3.01(a)
Tranche 1 Cash Portion of the Sales Price..................................................................3.01(a)
Tranche 1 Closing.............................................................................................4.01
Tranche 1 Closing Date........................................................................................4.01
Tranche 1 Closing Deadline....................................................................................4.01
Tranche 1 Contributed Equity Value.........................................................................3.01(a)
Tranche 1 Consideration....................................................................................3.01(a)
Tranche 1 Contributed Interests............................................................................1.01(a)
Tranche 1 Non-Cash Portion of Consideration................................................................3.01(a)
Tranche 1 Properties.......................................................................................1.01(a)
Tranche 1 Real Properties .................................................................................1.01(a)
Tranche 2 Permitted Debt...................................................................................3.01(b)
Tranche 2 Cash Portion of the Sales Price..................................................................3.02(b)
Tranche 2 Closing.............................................................................................4.02
Tranche 2 Closing Date........................................................................................4.02
Tranche 2 Contributed Equity Value.........................................................................3.01(b)
Tranche 2 Consideration....................................................................................3.01(b)
Tranche 2 Contributed Interests............................................................................1.01(b)
Tranche 2 Non-Cash Portion of Consideration................................................................3.01(b)
Tranche 2 Properties.......................................................................................1.01(b)
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Tranche 2 Real Properties..................................................................................1.01(b)
Tranche 3 Permitted Debt...................................................................................3.01(c)
Tranche 3 Cash Portion of the Sales Price..................................................................3.01(c)
Tranche 3 Closing.............................................................................................4.03
Tranche 3 Closing Date........................................................................................4.03
Tranche 3 Contributed Equity Value.........................................................................3.01(c)
Tranche 3 Consideration....................................................................................3.01(c)
Tranche 3 Contributed Interests............................................................................1.01(c)
Tranche 3 Non-Cash Portion of Consideration................................................................3.01(c)
Tranche 3 Properties.......................................................................................1.01(c)
Tranche 3 Real Properties..................................................................................1.01(c)
Transactions Agreement ...................................................................................11.01(w)
TSSC Threshold...............................................................................................14.03
Underwriting Agreement.......................................................................................18.01
Underwriting Deadline.........................................................................................4.01
Unidentified Debt..........................................................................................1.05(b)
Unidentified Debt Properties...............................................................................1.05(b)
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CONTRIBUTION AGREEMENT
----------------------
This CONTRIBUTION AGREEMENT (this "Agreement") dated as of August ___,
2005, among RECKSON OPERATING PARTNERSHIP, L.P., a Delaware limited
partnership ("Owner Operating Partnership"), having an address at 225
Broadhollow Road, Melville, New York 11747, and the various direct and
indirect wholly owned or controlled subsidiaries of Owner Operating
Partnership set forth on Exhibit A annexed hereto and on the signature pages
hereof (collectively, the "Subsidiaries"; the Subsidiaries and Owner Operating
Partnership, collectively, "Contributor"), RECKSON AUSTRALIA OPERATING COMPANY
LLC, a Delaware limited liability company, having an address at c/o Reckson
Management Group, Inc., 225 Broadhollow Road, Suite 212W, Melville, New York
11747, Attn: Francis Sheehan, Fax: 631-622-8994, Telephone: 631-622-6777 (the
"Company") and RECKSON AUSTRALIA LPT CORPORATION, a Maryland corporation (the
"REIT"), having an address at c/o Reckson Management Group, Inc., 225
Broadhollow Road, Suite 212W, Melville, New York 11747, Attn: Francis Sheehan,
Fax: 631-622-8994, Telephone: 631-622-6777. Defined terms used herein may be
located using the Index of Defined Terms immediately preceding this Preamble.
RECITALS:
---------
A. Owner Operating Partnership directly owns, or indirectly owns through
its wholly owned Subsidiaries, fee simple interests or ground leasehold
interests (as lessee) in the Real Properties (as hereinafter defined) set
forth on Exhibit B annexed hereto.
B. The Company is a subsidiary of the REIT, and was formed for the
purpose of acquiring (directly or indirectly) all right, title and interest of
Contributor in and to the Real Properties; such acquisition may be effectuated
by the acquisition of all of Owner Operating Partnership's right, title and
interest in some or all of the Subsidiaries in lieu of the acquisition of the
assets of such Subsidiaries, as contemplated by Section 19 hereof.
C. At each Closing, inter alia, Contributor shall contribute the
Properties (as hereinafter defined) to the Company and/or to certain designees
of the Company (which designees shall be referred to herein as the "SPE
Entities", and which SPE Entities shall be wholly-owned, and to the extent
required by any applicable lenders in respect of such SPE Entities, special
purpose, subsidiaries of the Company, newly formed prior to each Closing), as
applicable, pursuant to the terms of this Agreement and upon the satisfaction
of the conditions to each such Closing set forth herein.
D. Contributor shall receive Interests (as hereinafter defined) in the
Company and/or cash proceeds pursuant to terms of this Agreement and the LLC
Agreement (as hereinafter defined), as applicable, with respect to the
contribution of the applicable Properties to the Company and/or the SPE
Entities (the Company and/or the SPE Entities, as the context may require,
shall be referred to herein as the "Relevant Contributee")
E. The parties intend for the foregoing to be accomplished in three
closings (such closings are referred to herein as the Tranche 1 Closing, the
Tranche 2 Closing and the Tranche 3 Closing, and each may be referred to
herein as a "Closing", as such terms are more particularly defined
hereinafter), subject to the terms and conditions set forth herein.
F. At the Tranche 1 Closing, Owner Operating Partnership and the REIT
shall enter into that certain Amended and Restated Limited Liability Company
Agreement of the Company annexed hereto as Exhibit C (the "LLC Agreement").
G. At each Closing, (i) Reckson Management Group, Inc., a New York
corporation (which is an Affiliate (as defined in the LLC Agreement) of Owner
Operating Partnership) or certain Affiliates of Reckson Management Group, Inc.
(any of the foregoing, as the context may require, "Manager"), (ii) the
Company, and (iii) each Affiliate of the Company that shall be acquiring a
Property at such Closing, or, to the extent Contributed Interests are acquired
in lieu of any Properties, the Contributed Entity (as hereinafter defined),
shall enter into a Property Management and Leasing Agreement, substantially in
the form annexed hereto as Exhibit D-1, (collectively, the "Property
Management Agreements").
H. At each Closing, (i) Reckson Construction & Development, LLC, a
Delaware limited liability company, or certain Affiliates of Reckson
Construction & Development, LLC, (ii) the Company, and (iii) each Affiliate of
the Company that shall be acquiring a Property at such Closing, or, to the
extent Contributed Interets are acquired in lieu of any Properties, the
Contributed Entity, shall enter into a Construction Services Agreement,
substantially in the form annexed hereto as Exhibit D-2 (collectively, the "CS
Agreements", together with the Property Management Agreements, to be referred
to as the "Property Services Agreements").
I. At the Tranche 1 Closing, Manager and the Company shall enter into
that certain Services Agreement substantially in the form annexed hereto as
Exhibit D-3 (the "Services Agreement").
J. At the Tranche 1 Closing, Reckson Australia Asset Manager LLC, a
Delaware limited liability company, and the REIT shall enter into that certain
Asset Management Agreement substantially in the form annexed hereto as Exhibit
D-4 (the "AM Agreement", and together with the Property Services Agreements
and the Services Agreement, collectively, the "Portfolio Services
Agreements").
K. On or before the Tranche 1 Closing, Reckson Australia Management Ltd.,
a corporation organized under the laws of New South Wales, Australia ("RAML")
will be the responsible entity (the "Responsible Entity") in respect of
Reckson New York Property Trust, an Australian listed property trust (the
"Australian Trust").
L. At the Tranche 1 Closing, Owner Operating Partnership, certain of its
affiliates, the Company and the REIT shall enter into that certain Option
Agreement (as hereinafter defined).
M. At or prior to the Tranche 1 Closing, Reckson Australia Management
Limited and Citigroup Global Markets Australia Pty Ltd and UBS AG, Australia
Branch shall enter into that certain Underwriting Agreement (as hereinafter
defined).
N. In connection with the financing of the acquisition of the Properties
and Contributed Interests, as more particularly described herein, the parties
desire for Contributor to enter into certain Identified Debt (as hereinafter
defined) with UBS Real Estate Investments Inc. and/or other lenders, which
Identified Debt is intended to encumber certain of the Tranche 1 Properties on
or before the Tranche 1 Closing and certain of the Tranche 3 Properties on or
before the Tranche 3 Closing, and the applicable Properties are intended to be
transferred subject to such Identified Debt. Some of the Properties not
encumbered by Identified Debt may be transferred at the applicable Closing
subject to the Assumed Existing Debt (as hereinafter defined) currently
encumbering such Properties (subject to consent of the applicable lender and
other conditions set forth herein), and some of the Properties not encumbered
by Identified Debt or Existing Assumption Debt may be transferred subject to
Unidentified Debt (as hereinafter defined) agreed upon by the parties
subsequent to the date hereof and prior to the applicable Closing.
-2-
O. At the Tranche 1 Closing, Owner Operating Partnership, the Relevant
Contributee, the Company and the REIT shall enter into that certain Tax
Protection Agreement in the form annexed hereto as Exhibit M (the "Tax
Protection Agreement").
NOW THEREFORE, in consideration of the terms and conditions contained in
this Agreement, the mutual covenants herein contained and other good and
valuable consideration, the mutual receipt and legal sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
Section 1. Properties to be Contributed; Permitted Debt; Responsible
Entity Termination; Trigger Events; Schedules
1.01. Transfer of Properties. At each Closing, Contributor shall
contribute either the relevant Properties or the Contributed Interests to the
Relevant Contributee, subject in each case to any Permitted Debt permitted by
this Agreement to encumber such Properties, as described below:
(a) Tranche 1 Properties. At the Tranche 1 Closing, Contributor
shall contribute, assign, transfer and deliver to the Relevant Contributee,
and the Relevant Contributee shall receive from Contributor, upon the terms
and conditions set forth in this Agreement, either or both of (i) fee simple
and/or leasehold interests in and to the Properties set forth on Schedule
1.01(a) annexed hereto (the "Tranche 1 Real Properties"), and all right, title
and interest of Contributor in and to the fixtures, equipment and other
property attached or appurtenant to the Tranche 1 Real Properties or (ii)
Contributed Interests in the Contributed Entities that own such Tranche 1 Real
Properties (the "Tranche 1 Contributed Interests"; the Tranche 1 Real
Properties, together with the Tranche 1 Contributed Interests, the "Tranche 1
Properties", it being acknowledged and agreed that references in this
Agreement to the Tranche 1 Properties shall be deemed references to either or
both of the Tranche 1 Real Properties or the Tranche 1 Contributed Interests,
as the context may require); in exchange for the Tranche 1 Consideration that
is allocated among such Tranche 1 Properties as described in Section 3 of this
Agreement.
(b) Tranche 2 Properties. At the Tranche 2 Closing, Contributor
shall contribute, assign, transfer and deliver to the Relevant Contributee,
and the Relevant Contributee shall receive from Contributor, upon the terms
and conditions set forth in this Agreement, either or both of (i) fee simple
and/or leasehold interests in and to the Properties set forth on Schedule
1.01(b) annexed hereto (the "Tranche 2 Real Properties"), and all right, title
and interest of Contributor in and to the fixtures, equipment and other
property attached or appurtenant to the Tranche 2 Real Properties or (ii)
Contributed Interests in the Contributed Entities that own such Tranche 2 Real
Properties (the "Tranche 2 Contributed Interests"; the Tranche 2 Real
Properties, together with the Tranche 2 Contributed Interests, the "Tranche 2
Properties", it being acknowledged and agreed that references in this
Agreement to the Tranche 2 Properties shall be deemed references to either or
both of the Tranche 2 Real Properties or the Tranche 2 Contributed Interests,
as the context may require); in exchange for the Tranche 2 Consideration that
is allocated among such Tranche 2 Properties as described in Section 3 of this
Agreement.
(c) Tranche 3 Properties. At the Tranche 3 Closing, Contributor
shall contribute, assign, transfer and deliver to the Relevant Contributee,
and the Relevant Contributee shall receive from Contributor, upon the terms
and conditions set forth in this Agreement, either or both of (i) fee simple
and/or leasehold interests in and to the Properties set forth on Schedule
1.01(c) annexed hereto (the "Tranche 3 Real Properties", together with the
Tranche 1 Real Properties and the Tranche 2 Real Properties, the "Real
Properties"), and all right, title and interest of Contributor in and to the
fixtures, equipment and other property attached or appurtenant to the Tranche
3 Real Properties or (ii) Contributed Interests in the Contributed Entities
that own such Tranche 3 Real Properties (the "Tranche 3 Contributed
Interests", and together with the Tranche 1 Contributed Interests and the
Tranche 2 Contributed Interests, the "Contributed Interests"; the Tranche 3
Real Properties, together with the Tranche 3 Contributed
-3-
Interests, the "Tranche 3 Properties", it being acknowledged and agreed that
references in this Agreement to the Tranche 3 Properties shall be deemed
references to either or both of the Tranche 3 Real Properties or the Tranche 3
Contributed Interests, as the context may require; the Real Properties,
together with the Contributed Interests, the "Properties"); in exchange for
the Tranche 3 Consideration that is allocated among such Tranche 3 Properties
as described in Section 3 of this Agreement.
1.02. Additional Components of Properties; Excluded Property. For
purposes of this Agreement, the term "Real Properties" shall also include,
without limitation, all right, title and interest of Contributor in and to any
easements, rights of way, strips, gores, privileges, licenses, appurtenants
and other rights, benefits and interests, appurtenant thereto, including,
without limitation, all right, title and interest of Contributor in and to any
streets or other public ways adjacent to the Real Properties and any water,
sewer, utility district or mineral rights owned by, or leased to, Contributor,
all improvements located on each Real Property and all structures, systems and
utilities utilized by Contributor with respect to such Real Properties
exclusively (but excluding any improvements owned by tenants under any Leases
at the Real Properties, except any improvements owned by Contributor or to
which Contributor has rights under any Ground Lease), all tangible personal
property owned by Contributor and located on the land or used in connection
with each Real Property and all of Contributor's right, title and interest in
and to all Leases, Ground Leases, all security deposits given under all
Leases, the Ground Leases and all Service Contracts and other agreements to
the extent any adjustments are made pursuant to Section 13.01. Notwithstanding
anything to the contrary in this Agreement, the property described on Schedule
1.02 annexed hereto and made a part hereof (the "Excluded Personal Property")
shall not be included in the Properties subject to transfer pursuant to this
Agreement, nor shall the Excluded Personal Property be subject to transfer by
operation of law or otherwise in connection with transfer of Contributed
Interests under this Agreement. The parties acknowledge and agree that, at
each relevant Closing, Contributor and the Relevant Contributee(s) shall enter
into license agreements ("Excluded Property License Agreements") in the form
annexed hereto as Exhibit K and made a part hereof with respect to certain
Excluded Personal Property described on Schedule 1.02.
1.03. Review Materials. Contributor has made available to the Company
true, correct and complete copies of the Title Commitments, the Searches, the
Surveys, the Leases, Ground Leases, the Environmental Reports, the Continuing
Loan Documents, any engineering reports and appraisals ordered by Contributor
for the Company (together with any other materials reasonably requested by the
Company, collectively, the "Review Materials"). The Review Materials and any
other materials, reports, surveys, books and records examined by or on behalf
of the Company pursuant to this Agreement shall: (i) be held in strict
confidence by the Company, (ii) not be used for any purpose other than the
investigation and evaluation of the Properties by the Company and its lenders,
attorneys, financial advisors, investors, accountants, partners, members,
directors, officers, employees, agents, engineers and consultants involved or
likely to be involved in this transaction (collectively, the "Agents"), and
(iii) not to be disclosed, divulged or otherwise furnished to any other person
or entity prior to the Closing except to the Agents, as otherwise contemplated
herein, or as permitted by Contributor, or as required by law, regulation or
court order. If this Agreement is terminated for any reason whatsoever, the
Company shall, at its option, destroy or return to Contributor all of the
Review Materials in the possession of the Company and the Agents. The
provisions of this Section shall survive the termination of this Agreement.
1.04. Due Diligence. The Company acknowledges that, prior to the
execution of this Agreement, it has been permitted to make a complete review,
evaluation and inspection of the Real Properties and has completed all due
diligence deemed desirable by the Company with respect to the Real Properties.
To the extent not already delivered, copies of all other environmental,
appraisals, engineering or any other third party reports prepared by or on
behalf of the Company with respect to the Properties shall be provided
promptly to Contributor and such reports shall be held subject to the second
sentence of Section 1.03. Subject to Section 9.01, the Company shall have no
further right to inspect the Real
-4-
Properties or to conduct any testing in respect thereof unless approved in
writing by Contributor, such approval not to be unreasonably withheld, delayed
or conditioned. The Company acknowledges that it has entered into this
Agreement with the intention of making and relying solely upon its
investigation of the physical, environmental, economic and legal condition of
the Real Properties and that it is not relying upon any representation or
warranty of Contributor or any agent, employee, representative or Affiliate of
Contributor, other than those specifically set forth herein. The Company
further acknowledges that it has not received from Contributor any accounting,
tax, legal, architectural, engineering, environmental property management or
other advice with respect to the transactions contemplated hereby and that,
except as otherwise expressly provided herein, the Company is relying solely
upon the advice of its own accounting, tax, legal, architectural, engineering,
environmental, property management and other advisors.
1.05. Requests for Estoppels and Consents; Certain Provisions Regarding
Debt.
(a) Tenant Estoppels; Landlord Estoppels; Consents; Debt Releases.
Prior to each applicable Closing Date, with respect to the Tranche 1
Properties, the Tranche 2 Properties and the Tranche 3 Properties, Contributor
shall submit (i) written requests for Tenant Estoppels to all tenants of the
applicable Properties, (ii) written requests for Landlord Estoppels to all
ground lessors under the applicable Ground Leases, (iii) written requests for
consents to the appropriate party in accordance with Section 7.07, (iv)
written requests for approval (the "Permitted Debt Consents") of the
assumption of the Permitted Debt (as defined hereinafter) from the Permitted
Debt Holders (as defined hereinafter) and (v) a release or releases (the "Debt
Releases") from the applicable lenders releasing Contributor and its
Affiliates from all liability arising from and after the applicable Closing
under any and all debt documents related to the Permitted Debt. Contributor
shall use commercially reasonable efforts to procure the Debt Releases prior
to the applicable Closing and to include pre-approval of such Debt Releases in
the relevant Permitted Debt Loan Documents (as hereinafter defined).
(b) Certain Provisions Regarding Debt.
(i) General. Schedule 1.05(b)(i) annexed hereto lists (i) the
Real Properties that are encumbered by debt as of the date hereof and the
corresponding debt obligations (such debt, the "Existing Debt"), including the
principal amounts of Existing Debt outstanding as of the date hereof and a
designation of such Existing Debt as the parties intend to be either (x)
satisfied at each applicable Closing (the "Payoff Debt"), or (y) assumed by
the Company, and/or the Relevant Contributee, as indicated on Schedule
1.05(b)(i) (the "Assumed Existing Debt") at each applicable Closing, and, in
connection with the Real Properties subject to Assumed Existing Debt
(collectively, the "Assumed Existing Debt Properties"), a designation of the
lenders (the "Assumed Existing Debt Holders") that are holders of promissory
notes ("Promissory Notes") made in connection with loans ("Loans") secured by
mortgages or deeds of trust ("Mortgages") encumbering the Assumed Existing
Debt Properties, (ii) the Real Properties that the parties intend to be
encumbered (the "Identified Debt Properties") prior to the applicable Closing
with the approximately $248,000,000 of fixed rate debt (the "Identified Debt")
contemplated by that certain Mortgage Loan Application attached hereto as
Exhibit J (the "Mortgage Loan Application"), and (iii) to the extent currently
identifiable by the parties, the approximately $72,000,000 of floating rate
debt and any other debt (the "Unidentified Debt") and corresponding Tranche 1
Real Properties and Tranche 2 Real Properties and other Real Properties (the
"Unidentified Debt Properties") intended to be encumbered by such Unidentified
Debt at or prior to the Tranche 2 Closing and the principal amount(s) thereof.
"Permitted Debt" shall mean the Assumed Existing Debt, Identified Debt and
Unidentified Debt to be assumed at the relevant Closing. "Permitted Debt
Properties" shall mean the Assumed Existing Debt Properties, the Identified
Debt Properties and the Unidentified Debt Properties. "Permitted Debt Holders"
shall mean all holders of Promissory Notes made in connection with Permitted
Debt Loans.
-5-
(c) Negotiation and Approval of Loan Documentation. The Company and
the Relevant Contributees acknowledge and agree that Contributor shall have
the exclusive right (but in consultation with the Company and the other
Relevant Contributees) to negotiate the terms of the Identified Debt (subject
to the terms and conditions set forth in the Mortgage Loan Application) and
the Unidentified Debt, as well as the related loan documentation, with the
applicable lenders. The Contributor may present drafts of term sheets and
related loan documentation to the Company and the other Relevant Contributees
from time to time for review and approval, which approval shall not be
unreasonably withheld, conditioned or delayed, and the Company and the other
Relevant Contributees shall notify Contributor within five (5) Business Days
of approval or disapproval of the relevant matters, provided that failure of
the Company and the other Relevant Contributees to notify Contributor of
disapproval of any such matter within such time period shall be deemed
approval of such matter. Any such matter that is approved or deemed to be
approved shall not be the subject of further review by the Company and the
other Relevant Contributees absent material changes to such matters or
material changes to other portions of the documentation that materially affect
such matters. If any matter is disapproved in accordance with the foregoing,
the parties shall reasonably cooperate in good faith to resolve such dispute,
but failure to resolve such dispute shall not affect the obligations of the
parties under this Agreement. The Company and the other Relevant Contributees
hereby approve the terms of the Mortgage Loan Application. The parties
acknowledge and agree that any Identified Debt or Unidentified Debt negotiated
under this Section 1.05(c) shall include appropriate Debt Releases, if
applicable.
(d) Approval of Debt; Effect Thereof. The parties acknowledge and
agree that, upon written notification by the Relevant Contributees to
Contributor that the Relevant Contributees approve of all of the final terms
and final related loan documentation ("Approved Loan Documentation"), the
definitions of Sections 1.05(b) and 1.05(d) shall be deemed modified, if
necessary, to reflect the effect of such approved Identified and Unidentified
Debt on the Permitted Debt, and each of the parties shall, at the request of
any of the others, execute a reasonable amendment to this Agreement clarifying
the foregoing (including, if necessary, a description of any Existing Debt or
other Permitted Debt to be refinanced in connection with such Identified and
Unidentified Debt). The parties agree that, as may have been approved in
respect of such Permitted Debt in accordance with the foregoing, at
Contributor's option, either (x) at or prior to the applicable Closing,
Contributor shall enter into the Approved Loan Documentation and the Relevant
Contributees shall assume the relevant Identified Debt and Unidentified Debt
at such Closing in accordance with, and subject to, the terms and conditions
of this Agreement, or (y) at the applicable Closing, the Relevant Contributees
shall execute and deliver the Approved Loan Documentation.
1.06. Termination; Surviving Obligations. In the event that any express
provision of this Agreement gives any party the right to terminate this
Agreement, such party shall notify the other parties in writing of such
termination, and upon delivery of such notice this Agreement shall be
terminated and neither Contributor, the Company, nor the REIT shall have any
further liability to the other hereunder, except with respect to the covenants
and indemnities explicitly stated to survive termination of this Agreement,
including, without limitation, those contained in Section 1.03, Section
2.01(e), Section 5.01, Section 6.01, Section 6.03, Section 7.09, Section
13.02, Section 13.04, Section 13.06, Section 14, Section 15 and Section 17,
which shall be referred to herein as the "Surviving Obligations".
1.07. Reallocation of Properties and Contributed Interests Among
Tranches; Exclusion of Properties and Contributed Interests.
(a) Reallocation. The parties acknowledge and agree that Contributor
may, with the consent of the Relevant Contributees, which consent shall not be
unreasonably withheld, delayed or conditioned, reallocate the Properties (and
applicable Contributed Interests) scheduled to be
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contributed at each Closing among Tranche 1 Properties, the Tranche 2
Properties and the Tranche 3 Properties, and the parties agree to revise the
relevant schedules of this Agreement accordingly in order to reflect any
changes to the allocations of the Total Consideration and the Properties (and
applicable Contributed Interests) among such Tranches.
(b) Exclusion. For purposes of clarity, in addition to the
aforementioned right to reallocate the distribution of Properties among
Tranches, Contributor shall have the right to exclude Properties pursuant to
Section 18 of this Agreement in connection with like-kind exchanges of the
Excluded Properties (as hereinafter defined). If Properties are excluded from
this Agreement pursuant to Section 18, then the Cap shall be proportionately
reduced by the value of such Excluded Property relative to the value of the
remaining Properties (but the Basket shall not be reduced or increased as a
result of such exclusion).
1.08. Responsible Entity Termination Trigger Event. Notwithstanding
anything herein to the contrary, in the event that Reckson Australia
Management Ltd. (or any successor to Reckson Australia Management Ltd. that
shall be a controlled Affiliate of Owner Operating Partnership) is terminated
or otherwise removed or retired as the Responsible Entity for any reason (an
"RE Trigger Event"), then Owner Operating Partnership may, at its option and
in its sole discretion, elect to terminate this Agreement in its entirety,
subject to the Surviving Obligations.
1.09. Revisions to Schedules. The parties acknowledge and agree that, as
of the date hereof, certain schedules of this Agreement describing and
allocating the consideration are in a preliminary form or, due to the nature
of such schedules, it is impossible or unduly burdensome to continuously
update such schedules. The parties will use commercially reasonable efforts to
agree upon final forms of each schedule prior to the applicable Closing, using
good faith efforts to conform such schedules to such parties' expectations as
contemplated in the relevant DYNA Models, the PDS and other transaction
documents (it being acknowledged and agreed that, to the extent necessary or
desirable for the exercise of for the proper exercise of any right granted to
the parties hereunder, such schedules will be finalized in a timely manner to
permit the relevant party to exercise such right in an informed manner, and
the relevant time periods for exercise of such rights will be extended on a
day for day basis attributable to any delay attributable to the other party,
as may be necessary).
Section 2. Objections to Title
2.01. (a) Title Commitments; Title Policies; Permitted Exceptions. The
Company acknowledges and agrees that it has received copies of ALTA title
insurance commitments (together with any updates and endorsements thereto, the
"Title Commitments") issued by Commonwealth Land Title Insurance Company
and/or First American Title Insurance Company or such other reputable title
insurance companies designated by Contributor which is licensed to do business
in the states where the Properties are located (collectively, the "Title
Company") in respect of all of the Properties on or prior to the date hereof.
The title insurance policies to be issued at each Closing by Title Company
pursuant to the Title Commitments shall be standard forms of owner's policies
(ALTA Form 1992 or later), in jurisdictions where such forms of policy are
available, in the collective amount of the Tranche 1 Consideration, Tranche 2
Consideration and Tranche 3 Consideration, as applicable, allocated to the
relevant Properties as the Company shall require at each Closing, and shall
contain such endorsements (including non-imputation), affirmative coverages
and reinsurance and/or co-insurance as the Company shall reasonably require
(collectively, the "Title Policies"). Each Title Policy shall insure (in the
policy amount set forth therein) that the Company or applicable Subsidiary
listed in such policy holds fee or leasehold title to such Property, as
applicable, as of the applicable Closing Date, subject only to, with respect
to such Property, (i) the exceptions contained in the applicable Title
Commitment as of the date hereof (except for any "standard" or "general"
exceptions, which shall be removed by satisfactory title
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affidavit from Contributor), (ii) any matters affecting title created before
or after the date hereof by or with the written consent of the Relevant
Contributees, (iii) any other title or survey matters which arise after the
date hereof that either are not objected to in writing by the Company pursuant
to Section 2.01(c) hereof, or, if objected to in writing by the Company
pursuant to Section 2.01(c) hereof, are those (A) which Contributor has
elected in writing not to remove or cure (which shall be a matter within
Contributor's sole discretion, excepting solely as to Must Removes (as defined
below), or has been unable to remove or cure prior to the Closing Date
(excepting Must Removes), and, in each case, subject to which the Company has
elected in writing to accept as Permitted Exceptions, (B) over which the Title
Company is willing to insure or provide affirmative insurance (at no cost or
expense to the Relevant Contributees), or (C) which are the responsibility of
any tenant under the Leases to cure, correct or remove including, without
limitation, Leases executed in accordance with the terms of Section 7, and
(iv) any other matters to which the Relevant Contributees are required to
accept title to the Properties pursuant to the terms of this Agreement,
(clauses (i) through (iv), collectively, the "Permitted Exceptions"), and (v)
with respect to all Properties, otherwise free and clear of all standard or
general exceptions contained in the Title Commitments which the Title Company
is permitted by applicable law to remove upon delivery of the Surveys and
customary title affidavits from Contributor. Contributor shall cause the Title
Policies to be issued to the Relevant Contributees at the applicable Closing.
The Company has ordered, at Company's expense, customary UCC, judgment, lien
and bankruptcy searches against Contributor and the Properties (as applicable)
(together with any updates thereto, collectively, the "Searches").
Notwithstanding anything contained herein to the contrary, the following shall
not be deemed "Permitted Exceptions" (collectively, the "Must Removes"): (X)
other than the liens representing the Permitted Debt, any monetary liens
voluntarily created by Contributor including, without limitation, any
mortgage, lien, pledge, encumbrance or exception to title against such
Property (whether such Property consists of Contributed Interests or Real
Property) created by the voluntary action of Contributor or its Affiliates
against or affecting such Property that can be removed or cured by payment of
a liquidated sum of money and (Y) any judgment, fines penalties or other
involuntary liens affecting such Property if and to the extent that the
aggregate cost of satisfying the claims secured by such liens is less than (i)
Twenty-Five Thousand ($25,000) Dollars per Property and (ii) the aggregate of
Five Hundred Thousand ($500,000) Dollars for all Properties per Tranche (as
applicable, the "Title Cap").
(b) Surveys. The Relevant Contributee(s) acknowledge and agree that
on or prior to the date hereof they have received copies of updated surveys of
each of the Properties in form and substance satisfactory to the Relevant
Contributee(s) (the "Surveys", and each, a "Survey"), certified to the
Company, the Relevant Contributees and the Title Company.
(c) Defects. Subject to Section 2.01(e), with respect to (i) any new
matters raised by the Title Company after the date hereof as an additional
exception in any Title Commitment or (ii) such new matters as may be disclosed
by updates to any Survey or the Searches and, in the case of clauses (i) and
(ii), which (x) have a material adverse effect on the use, utility or value of
the Property or the use, utility or value of the Contributed Interests, and
(y) are not otherwise Permitted Exceptions (each a "Defect"), within five (5)
Business Days after the Company receives written notification thereof, the
Company shall give written notification(s) to Contributor (each such
notification, a "Defects Notice") of any objections the Company may have to
such Defect. Contributor shall elect, by written notice (each such notice, a
"Cure Choice Notice") within seven (7) Business Days after receipt of a
Defects Notice (it being agreed that failure to provide notice of such
election within such period shall be deemed refusal to cure such Defect to the
Relevant Contributees), to either cure or refuse to cure any such Defect with
regard to any Property. If Contributor elects to cure such Defect in
accordance with the foregoing, such Defect shall be deemed a "Must Remove"
under this Agreement. If the Contributor does not elect to cure such Defect in
accordance with the foregoing, the Company shall notify Contributor within
five (5) Business Days (the expiration date of such five (5) Business Day
period, the "Defect Threshold Deadline") after expiration of such seven (7)
day period whether it shall (i) terminate this Agreement in
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its entirety, subject to the Surviving Obligations, provided that the Relevant
Contributees shall not have the right to terminate this Agreement pursuant to
this clause (i) until the Relevant Contributees shall have terminated this
Agreement pursuant to the following clause (ii) with respect to one or more
Properties, the individual or aggregate value of which (based conclusively on
the Total Consideration allocated to such Property or Properties as set forth
on the relevant schedules), is greater than or equal to fifteen percent (15%)
of the Total Consideration as of the date hereof (such threshold, the "Defect
Threshold"), or (ii) terminate this Agreement with respect to the affected
Property (each such affected Property as to which this Agreement is
terminated, a "Defect Property") only (in which event (x) this Agreement
shall, without further action of the parties, be deemed to have been
automatically and ipso facto amended so as to eliminate such Property, (y) the
applicable Tranche 1 Consideration, Tranche 2 Consideration or Tranche 3
Consideration shall be reduced by the portion thereof allocated to such
Property, and the Cap shall be proportionately reduced (but the Basket shall
not be reduced as a result of such elimination), and (z) this Agreement shall
otherwise remain in full force and effect); it being agreed that failure to
provide notice of such election within such response time period shall be
deemed an election to proceed with the transactions contemplated in this
Agreement, subject to the terms and conditions of this Agreement, without
terminating this Agreement with respect to any such affected Property,
provided that the foregoing shall not be construed as a waiver of any
subsequent termination rights that may be available to the Relevant
Contributees under this Section 2.01(c). If the Defect Threshold is reached,
then Contributor shall have the right ("Defect Threshold Termination Right")
to terminate this Agreement in its entirety by written notice to the Relevant
Contributees on or before the Defect Threshold Deadline; failure to exercise
the Defect Threshold Termination Right in accordance with the foregoing shall
be deemed an election by Contributor to proceed with the transactions
contemplated in this Agreement, subject to reinstatement of the Defect
Threshold Termination Right at such time as further Defects aggregating,
together with previously discovered Defects, in excess of the Defect Threshold
may be revealed in accordance with the foregoing. Each Defect Property not
replaced with a Substitute Property shall become an "Option Property" under
the Option Agreement, and shall be subject to the terms and conditions of the
Option Agreement.
(d) Cure of Defects. Contributor shall have the right, but not the
obligation, to cure any such Defect within fifteen (15) Business Days after
its receipt of the Defect Notice, or in the case of any Defect which cannot
with due diligence be cured within such fifteen (15) Business Day period, such
later date by which such Defect can reasonably be cured, provided that
Contributor commences to cure such Defect within such fifteen (15) Business
Day period and thereafter continues diligently and in good faith to cure the
Defect, provided, further, that Contributor's right to cure any Defect in
accordance with the foregoing provisions is subject to compliance with the
provisions of Section 2.01(c) of this Agreement applicable to Cure Choice
Notices. In the event that Contributor elects not to cure any such Defect or
is unable to effect such cure prior to the applicable Closing, the Company
shall have the remedies provided in Section 2.01(c), this Section 2.01(d) and
Section 14 hereof. Notwithstanding anything to the contrary contained in this
Agreement, Contributor shall have no obligation to cure any Permitted
Exceptions and Defects (other than the Must Removes) and shall only have the
obligation to cure the Must Removes. If Contributor fails to cure any Defects
other than the Must Removes, or if by the expiration of the cure period
provided for above, Contributor has failed to cure all Defects (other than the
Must Removes), the Company shall nonetheless be obligated to proceed to close
subject to any such Defects. In such event, at the Company's sole election,
(a) the Company shall deduct from the applicable Tranche 1 Consideration,
Tranche 2 Consideration or Tranche 3 Consideration with respect to such
Property the cost to cure ("Cost to Cure") such Defect as mutually agreed to
by the Company and Contributor in their commercially reasonable discretion (it
being acknowledged and agreed that, in the event that the Total Consideration
allocated to such Property consists of both Contributed Equity Value and Cash
Portion of Sales Price, such deduction shall be allocated to the Cash Portion
of Sales Price with respect to such Property, provided, however, that if the
Cost to Cure exceeds the Cash Portion of Sales Price in respect of such
Property, the Relevant Contributees may allocate such deduction
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to the Cash Portion of Sales Price applicable to any other Properties), or (b)
Contributor shall place into escrow with the Title Company, pursuant to an
escrow agreement in a form mutually agreed to by the parties, the cost to cure
such Defect as mutually agreed to by the Company and Contributor in their
commercially reasonable discretion; provided, however, that in no event shall
the amount of such deduction or such escrow, together with all amounts paid by
Contributor to cure Defects (other than the Must Removes) exceed (i) the
portion of the Total Consideration allocated to such Property, with respect to
any individual Property, or (ii) the Title Cap, in the aggregate. In no event
shall an amount so deducted or escrowed reduce the amount available under the
Title Cap; provided, however, that in the event that the subject Defect
constitutes a Breach of the representations and warranties contained in
Section 5.01(i) or Section 5.01(o), the Company shall not be entitled to
indemnification with respect thereto pursuant to Section 5.05(a), to the
extent of amounts in escrow or paid in accordance with this Section 2.01(d).
Contributor shall satisfy any Must Removes of record or, as an alternative to
causing such Must Removes to be satisfied of record and provided that the
Title Company agrees to omit such Must Remove(s) from the Title Policies: (i)
bond or cause to be bonded such Must Remove(s), (ii) deliver or cause to be
delivered to the Title Company, on the date of the Closing, instruments in
recordable form and sufficient to satisfy such Must Remove(s) of record,
together with the appropriate recording or filing costs, or (iii) deposit or
cause to be deposited with the Title Company sufficient monies, acceptable to
and reasonably requested by the Title Company, to assure the obtaining and
recording of a satisfaction of the Must Remove(s). With respect to (a) any
condition or state of facts that is set forth on any Title Commitment, Survey
or Search as of date hereof or (b) any Defect (other than the Must Removes)
for which the Company fails to deliver a Defect Notice thereof in accordance
with this Agreement, such Defect or Defect, as the case may be, shall be
deemed approved by the Company and shall constitute a Permitted Exception
hereunder, and the Company shall be obligated to close without further
deduction from the applicable Total Consideration with respect to any such
items. In the event that any of the foregoing time periods applicable to the
Relevant Contributees responses to various notices would otherwise extend
beyond the applicable Closing Date, the Closing Date shall, at the request of
the Relevant Contributees, be extended on a day for day basis in respect of
such time period.
(e) Substitute Properties In Connection With Title Defects.
Notwithstanding anything to the contrary contained herein, in the event that
any Defect that Contributor intended or is otherwise obligated to cure
hereunder has not been cured as of the applicable Closing Date with respect to
the applicable Property in accordance with Section 2.01(c) or Section 2.01(d),
such event shall constitute a "Defect Substitution Event" for the purposes of
this Agreement.
(f) Substitution Procedures. If any of (x) a Defect Substitution
Event, (y) a CC Substitution Event (as hereinafter defined) or (z) a Closing
Condition Substitution Event (as hereinafter defined) occurs from time to
time, Contributor may in its sole and absolute discretion elect (with respect
to a Defect Substitution Event or a Closing Condition Substitution Event, at
any time at or prior to the applicable Closing; with respect to a CC
Substitution Event, within ten (10) Business Days of delivering notice of such
CC Substitution Event) to retain its interests in such affected Property or
Properties (individually or collectively, as the context may require, the
"Affected Property") (for purposes of clarity, notwithstanding anything to the
contrary, one Substitute Property may replace more than one Affected Property
if the value of the Substitute Property is greater than or equal to such
replaced Properties) and, in lieu of transferring such interests to the
Company at the applicable Closing, as may be otherwise required by this
Agreement, Contributor shall deliver to the Company fee simple title (or
Contributed Interests, as applicable) with respect to a Substitute Property,
pursuant to the same terms of this Agreement applicable to any other Property,
provided that in the event that title to the Substitute Property is delivered
to the Relevant Contributee in accordance with the foregoing, the Company
shall obtain the prior approval of any lender of the Company to release any
mortgage or other lien held by such lender on the Substitute Property in
exchange for a lien on the Property originally required to be delivered at the
applicable Closing Date once such Defect is cured. If the applicable lender
does not agree to
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release such mortgage or other lien, such mortgage or lien shall, at the sole
cost and expense of Contributor, be prepaid in respect of such Substitute
Property. For purposes of this Agreement, "Substitute Property" shall mean a
property in the New York tri-state area (v) with a value, mutually agreed upon
by Contributor and the Relevant Contributees, that is equal to or greater than
that of the Affected Property affected or subject to the applicable Defect
Substitution Event, CC Substitution Event or Closing Condition Event, (w)
generally consistent with the Properties, (x) having income equal or greater
to the amount set forth in the DYNA Model with respect to such Affected
Property, (y) having leases that otherwise comply with the applicable DYNA
Model, and (z) otherwise acceptable to any lender (including Permitted Debt
Holders) of the Company providing financing with respect to such Affected
Property. Contributor shall bear the costs and expenses of all appraisals
required by the foregoing. If such Substitute Property has a greater value
than the value of the Affected Property, the Total Consideration (and
appropriate components thereof) shall be increased accordingly. For purposes
of this Agreement, the term "DYNA Models" shall mean those certain net
operating income projections for each of the Properties prepared on behalf of
the Company to value the Properties as of the date set forth in the DYNA
Models. If Contributor conveys Substitute Property to the Company, in lieu of
any Property identified on Exhibit B annexed hereto, Contributor shall have
the right to require the Company to acquire such Substitute Property at such
time as the conditions set forth in this Agreement with respect to the
acquisition of such Property and the applicable Closing have been satisfied.
Contributor shall pay all actual out-of-pocket expenses incurred by the
Company in connection with Contributor's exercise of its rights pursuant to
the immediately preceding sentence. It is acknowledged and agreed that upon
substitution of such Substitute Property in accordance with the provisions of
this Section 2.01(f), such substitution shall be deemed to cure the relevant
Defect Substitution Event, CC Substitution Event and/or Closing Condition
Substitution Event applicable to the Affected Property, and notwithstanding
anything to the contrary herein, the Relevant Contributees shall not be
permitted to (x) exercise any termination right under this Agreement arising
in connection with such Affected Property or (y) to bring any proceeding
otherwise permitted under this Agreement in respect of breach of
representations and warranties or covenants in respect of the Affected
Property. Notwithstanding anything to the contrary in this Agreement, either
party shall have the right, by written notice, to extend the applicable
Closing (and all subsequent Closings on a day for day basis) for up to fifteen
(15) Business Days in order to effectuate the provisions of this Section
2.01(f). This Section 2.01(f) shall survive the applicable Closing.
Section 3. Contribution Consideration
3.01. Consideration.
(a) Tranche 1 Consideration. Schedule 3.01(a)(i) annexed hereto sets
forth (i) the aggregate agreed upon equity value of the Tranche 1 Properties
to be contributed at the Tranche 1 Closing (referred to herein as the "Tranche
1 Contributed Equity Value"), (ii) the aggregate principal amount outstanding
as of the Tranche 1 Closing Date of the Permitted Debt for such Tranche 1
Properties (such Permitted Debt, the "Tranche 1 Permitted Debt") and (iii) the
aggregate agreed upon cash portion of consideration (the "Tranche 1 Cash
Portion of the Sales Price") and the aggregate agreed upon non-cash
consideration (the "Tranche 1 Non-Cash Portion of Consideration") for the
contribution and transfer of each of the Tranche 1 Properties to the Relevant
Contributees at the Tranche 1 Closing. The sum of the amounts referenced in
clauses (i) and (ii) shall be referred to herein, collectively, as the
"Tranche 1 Consideration". Subject to Section 3.02, on the Tranche 1 Closing
Date, the Company shall (i) issue non-managing member interests in the Company
(the "Interests") to Owner Operating Partnership or, in Contributor's sole and
absolute discretion, to the applicable Subsidiary, as to the Tranche 1
Non-Cash Portion of Consideration, if any, as allocated for each Tranche 1
Property and (ii) pay to the Owner Operating Partnership or, in Contributor's
sole and absolute discretion, to the applicable Subsidiary the Tranche 1 Cash
Portion of the Sales Price, if any.
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(b) Tranche 2 Consideration. Schedule 3.01(b)(i) annexed hereto sets
forth (i) the aggregate agreed upon equity value of the Tranche 2 Properties
to be contributed at the Tranche 2 Closing (referred to herein as the "Tranche
2 Contributed Equity Value"), (ii) the Permitted Debt for such Tranche 2
Properties as of the Tranche 2 Closing Date (such Permitted Debt, the "Tranche
2 Permitted Debt") and (iii) the aggregate agreed upon cash portion of
consideration (the "Tranche 2 Cash Portion of the Sales Price") and the
aggregate agreed upon non-cash consideration (the "Tranche 2 Non-Cash Portion
of Consideration") for the contribution and transfer of each of the Tranche 2
Properties to the Relevant Contributee(s) at the Tranche 2 Closing. The sum of
the amounts referenced in clauses (i) and (ii) shall be referred,
collectively, to herein as the "Tranche 2 Consideration". Subject to Section
3.02, on the Tranche 2 Closing Date, the Company shall (i) issue Interests to
Owner Operating Partnership or, in Contributor's sole and absolute discretion,
to the applicable Subsidiary, as to the Tranche 2 Non-Cash Portion of
Consideration, if any, as allocated for each Tranche 2 Property and (ii) pay
to the Owner Operating Partnership or, in Contributor's sole and absolute
discretion, to the applicable Subsidiary the Tranche 1 Cash Portion of the
Sales Price, if any.
(c) Tranche 3 Consideration. Schedule 3.01(c)(i) annexed hereto sets
forth (i) the aggregate agreed upon equity value of the Tranche 3 Properties
to be contributed at the Tranche 3 Closing (referred to herein as the "Tranche
3 Contributed Equity Value"), (ii) the Permitted Debt for such Tranche 3
Properties as of the Tranche 3 Closing Date (such Permitted Debt, the "Tranche
3 Permitted Debt") and (iii) the aggregate agreed upon cash portion of
consideration (the "Tranche 3 Cash Portion of the Sales Price") and the
aggregate agreed upon non-cash consideration (the "Tranche 3 Non-Cash Portion
of Consideration") for the contribution and transfer of each of the Tranche 3
Properties to the Relevant Contributee(s) at the Tranche 3 Closing. The sum of
the amounts referenced in clauses (i) and (ii) shall be referred to herein,
collectively, as the "Tranche 3 Consideration". Subject to Section 3.02, on
the Tranche 3 Closing Date, the Company shall (i) issue Interests to Owner
Operating Partnership or, in Contributor's sole and absolute discretion, to
the applicable Subsidiary, in an amount equal to the Tranche 3 Non-Cash
Portion of Consideration, if any, as allocated for each Tranche 3 Property and
(ii) pay to the Owner Operating Partnership or in Contributor's sole and
absolute discretion, to the applicable Subsidiary, the Tranche 1 Cash Portion
of the Sales Price, if any. The Tranche 1 Consideration, the Tranche 2
Consideration and the Tranche 3 Consideration, collectively, are referred to
herein as the "Total Consideration" (it being acknowledged and agreed that the
Total Consideration on the date hereof is Four Hundred Fifty Seven Million
Five Hundred Thirty One Thousand Two Hundred Thirty Five and 00/100 Dollars
($457,531,235.00)). The Tranche 1 Contributed Equity Value, the Tranche 2
Contributed Equity Value and the Tranche 3 Contributed Equity Value,
collectively, are referred to herein as the "Contributed Equity Value". The
Tranche 1 Cash Portion of the Sales Price, the Tranche 2 Cash Portion of the
Sales Price and the Tranche 3 Cash Portion of the Sales Price, collectively,
are referred to herein as the "Cash Portion of the Sales Price".
(d) De Minimis Consideration; Sales Tax. Contributor and the Company
hereby acknowledge and agree that the value of the non-real estate assets
associated with the Properties to be contributed and sold to the Relevant
Contributee(s) is de minimis and no part of the Contributed Equity Value or
Cash Portion of the Sales Price is allocable thereto. Although it is not
anticipated that any sales tax shall be due and payable, the Company agrees
that the Company shall pay any and all State of New York sales and/or use
taxes imposed upon or due in connection with the transactions contemplated
hereunder under any applicable laws of New York State. The Company shall file
all necessary tax returns with respect to such taxes and, to the extent
required by applicable law, Contributor will join in the execution of any such
tax returns.
3.02. Adjustments to Consideration. The amounts set forth in Schedules
3.01(a), 3.01(b) and 3.01(c) shall each be adjusted as of the respective
Closing to reflect (i) any adjustments made pursuant to Section 2.01(d),
Section 13, and any other adjustments to the Cash Portion of the Sales Price
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with respect to any Property (plus or minus) made in accordance with any other
term or provision of this Agreement and (ii) any principal payments made on
the Permitted Debt after the date hereof for each of the Tranche 1 Closing,
Tranche 2 Closing and Tranche 3 Closing, it being understood that any such
principal payments shall result in a corresponding increase in the Tranche 1
Contributed Equity Value, the Tranche 2 Contributed Equity Value and the
Tranche 3 Contributed Equity Value, as applicable, as allocated for each of
the Permitted Debt Properties for which such principal payments are made to
the applicable Cash Portion of the Sales Price.
3.03. Effect of Permitted Debt Holder Refusal of Assumption Consent. If,
on or prior to the Tranche 1 Closing, the Tranche 2 Closing or the Tranche 3
Closing, as applicable, one or more of the Permitted Debt Holders refuses to
give a Permitted Debt Consent to Contributor and/or refuses to provide a Debt
Release, then Contributor shall prepay or if permitted thereby, defease, such
Permitted Debt in full on or prior to the applicable Closing, and the
applicable Contributed Equity Value for each such Permitted Debt Property so
prepaid or defeased shall be increased by the amount of principal, interest
and prepayment premiums or penalties payable in respect of the amount so
prepaid or defeased, and such increase shall be allocated to the applicable
Cash Portion of the Sales Price.
3.04. Certain Transactions at Closing. At each Closing, upon the
consummation of the applicable transactions contemplated herein, the Relevant
Contributee(s) shall (i) pay the applicable Cash Portion of the Sales Price
(plus or minus net adjustments and prorations pursuant to Section 13) with
respect to the Properties to Contributor or such other entity as required to
effectuate the transactions contemplated hereby, (ii) issue the applicable
Interests with respect to the Properties to Contributor or the applicable
Subsidiary, as applicable, and (iii) and the Relevant Contributees shall
assume the Permitted Debt (to the extent applicable) in accordance with
Section 3.02.
3.05. Issuance of Interests In Advance. Notwithstanding the foregoing,
the Contributor may elect (the "Aggregate Interests Election"), at or prior to
the Tranche 1 Closing, to receive at the Tranche 1 Closing, subject to the
terms and conditions of this Agreement, all of the Interests otherwise
intended to be issued at each of the Tranche 1 Closing, the Tranche 2 Closing
and the Tranche 3 Closing. If the Contributor makes the Aggregate Interests
Election, then the Company and the REIT shall cause the Interests to be issued
at the Tranche 1 Closing, and notwithstanding anything to the contrary in this
Agreement, the Company and the REIT shall have no further obligation under
this Agreement to issue Interests at any Closing, and such obligation shall be
deemed fulfilled at each relevant Closing. Such Interests transferred in
connection with the Tranche 1 Closing shall be transferred subject to the
express condition that if any of the Properties or Contributed Interests are
not conveyed pursuant to the terms of this Agreement and Contributor has not
elected to cure such failure with a Substitute Property in accordance with the
terms and provisions of this Agreement, then the Interests shall be reduced or
returned by the portion thereof allocated to such Property.
Section 4. The Closing
4.01. Tranche 1 Closing. Except as otherwise provided in this Agreement,
the contribution of the Tranche 1 Properties and the delivery of the
applicable Interests pursuant to this Agreement and the LLC Agreement, payment
of the Tranche 1 Cash Portion of Sales Price and assumption of the relevant
Permitted Debt, shall be consummated at a closing (the "Tranche 1 Closing")
that shall take place at 10:00 a.m. on or about September 30, 2005 (the
"Tranche 1 Closing Date") (anticipated to be the date that is four (4)
business days after receipt by Australian Trust of that portion of the
aggregate subscription price for the initial public offering of units in the
Australian Trust which is payable on the closing date of said initial public
offering), or such other earlier date as may be agreed to by the parties
hereto, and which closing shall be at the offices of Paul, Hastings, Janofsky
& Walker LLP, 75 East 55th Street, New York, New York 10022, or such other
location as the parties may agree upon;
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provided; however, that if (i) the Underwriting Agreement is not executed by
the parties thereto on or before September 30, 2005 ("Underwriting Deadline")
or (ii) the Tranche 1 Closing has not occurred on or before October 31, 2005
(the "Tranche 1 Closing Deadline"), either Contributor or the Company may
elect, at its option, to terminate this Agreement by giving the other party
written notice of the exercise of such election at any time after the
Underwriting Deadline or the Tranche 1 Closing Deadline, as applicable,
whereupon this Agreement shall terminate, and neither Contributor nor the
Company shall have any further liability to the other hereunder, except for
the Surviving Obligations.
4.02. Tranche 2 Closing. Except as otherwise provided in this Agreement,
the contribution of the Tranche 2 Properties and the delivery of the
applicable Interests pursuant to this Agreement and the LLC Agreement, payment
of the Tranche 2 Cash Portion of Sales Price and assumption of the relevant
Permitted Debt, shall be consummated at a closing (the "Tranche 2 Closing")
that, subject to the last sentence of Section 7.01, shall take place at 10:00
a.m. on or about January 5, 2006 (the "Tranche 2 Closing Date"), or such other
earlier date as may be agreed to by the parties hereto, at the offices of
Paul, Hastings, Janofsky & Walker LLP, 75 East 55th Street, New York, New York
10022, or such other location as the parties may agree upon.
4.03. Tranche 3 Closing. Except as otherwise provided in this Agreement,
the contribution of the Tranche 3 Properties and the delivery of the
applicable Interests pursuant to this Agreement and the LLC Agreement, payment
of the Tranche 3 Cash Portion of Sales Price and assumption of the relevant
Permitted Debt, shall be consummated at one or more closings (collectively,
the "Tranche 3 Closing") that, subject to the last sentence of Section 7.01,
shall take place at 10:00 a.m. on or about October 1, 2006 (the "Tranche 3
Closing Date"), or such other earlier or later dates as may be agreed to by
the parties hereto, at the offices of Paul, Hastings, Janofsky & Walker LLP,
75 East 55th Street, New York, New York 10022, or such other location as the
parties may agree upon.
4.04. Closings. For purpose of this Agreement, the term "Closing" shall
mean any of the Tranche 1 Closing, Tranche 2 Closing or Tranche 3 Closing, as
the context may require, and the term "Closing Date" shall mean any of the
Tranche 1 Closing Date, Tranche 2 Closing Date or Tranche 3 Closing Date, as
the context may require.
4.05. Effect of a Closing Not Occurring. Notwithstanding the foregoing,
(a) if the Tranche 1 Closing does not occur for any reason and this Agreement
is terminated in accordance with the terms hereof, then neither Contributor
nor the Company shall have any obligation to consummate the Tranche 2 Closing
and the Tranche 3 Closing, and (b) if the Tranche 2 Closing does not occur for
any reason and this Agreement is terminated in accordance with the terms
hereof, then neither Contributor nor Company shall have any obligation to
consummate the Tranche 3 Closing. To the extent that such failure to close is
a default hereunder, the parties shall be entitled to exercise their
respective remedies as expressly provided herein.
4.06. Dates; Times; Dollars. For purposes of clarity, the parties hereto
acknowledge and agree that (x) all references to dates in this Agreement shall
be deemed references to the occurrence of such date in New York, New York, (y)
all references to times shall be deemed references to Eastern Standard Time,
and (z) all references to monetary amounts shall be deemed references to
United States Dollars (such amounts to be paid by Federal Funds Wire Transfer
of immediately available funds), except to the extent expressly noted to the
contrary in this Agreement. In addition, unless otherwise specified herein,
all references to the delivery of "true", "correct", and/or "complete" (A)
copies of any documents, materials and other information and (B) lists or
other disclosures (and, in each case, words of similar import), shall be
deemed to be followed by the words "in all material respects".
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Section 5. Representations and Warranties
5.01. Contributor Representations and Warranties. Owner Operating
Partnership and each of the Subsidiaries, respectively, represent and warrant
as to itself (and not as to each other or any other entity) and as to the
Contributed Interests and the other Properties that it contributes or
otherwise transfers (and not as to any other Properties) to the Relevant
Contributees as follows (notwithstanding the pluralization used in the
following representations and warranties, the breadth of the following
representations and warranties shall not be deemed expanded beyond the scope
indicated by the foregoing):
(a) Such party (x) is a partnership, limited partnership or limited
liability company, as applicable, formed, existing and in good standing under
the laws of the state of its formation, (y) is qualified and in good standing
in each of the states in which each of the Properties directly owned by it are
located (to the extent required by law), except where the failure to do so
would not have a material adverse effect on the ability of such Subsidiary to
fulfill its responsibilities under this Agreement and (z) has the requisite
power and authority (i) to enter into this Agreement and all documents
contemplated hereunder to be entered into by such party, and (ii) to perform
the terms and obligations of such party under this Agreement and such other
documents.
(b) Subject to obtaining the Required Consents, the execution and
delivery of this Agreement and the consummation of the transactions
contemplated hereby on the part of such party have been duly authorized by all
necessary partnership action, limited partnership action or limited liability
company action, as applicable, and no other proceedings or consents on the
part of such party are necessary in order to permit it to consummate the
transactions contemplated hereby.
(c) This Agreement has been duly executed by such party and all of
such party's obligations hereunder are the legal, valid and binding
obligations of such party, enforceable in accordance with the terms of this
Agreement, subject to applicable bankruptcy, insolvency, reorganization,
moratorium, fraudulent transfer and other similar laws relating to or
affecting creditors' rights generally from time to time in effect and to
general principles of equity (including concepts of materiality,
reasonableness, good faith and fair dealing), regardless whether considered in
a proceeding in equity or at law.
(d) Such party is not the subject of any bankruptcy, reorganization,
insolvency or similar proceedings on the date hereof. To such party's
knowledge, there are no such proceedings threatened against such party, nor
are any such proceedings contemplated by such party.
(e) Annexed hereto as Schedule 5.01(e)-1 is a true, correct and
complete copy of the rent rolls for the Properties (the "Rent Rolls")
identifying and listing, as of the date thereof, by tenant, security deposits,
square footage, and monthly fixed rent. The parties hereto acknowledge that
such Rent Rolls may not list (and, to the extent that such Rent Rolls do not
list, such party makes no representation or warranty with respect to) (i)
subleases, concessions or license agreements which may have been entered into
by tenants or subtenants (unless such subleases, concessions, or license
agreements were known to such party), (ii) license or concession agreements
that have terms not in excess of sixty (60) days or are terminable by the
landlord without penalty, and (iii) kiosks or pushcarts occupied under
agreements that are terminable by the landlord without penalty upon not more
than one month's notice. Annexed hereto as Schedule 5.01(e)-2 is a true,
correct and complete list of all tenant arrearages for all of the Properties.
(f) Annexed hereto as Schedule 5.01(f) is a true, correct and
complete list of all written leases or occupancy agreements for the Properties
(which together with all existing
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amendments and modifications thereof are collectively referred to as
"Leases"), and true, correct and complete copies of each Lease have been
delivered or made available to the Company. To such party's knowledge, each
Lease is in full force and effect. Except as set forth on Schedule 5.01(f), to
such party's knowledge, such party has not received any written notice that
such party is in breach or default under any Lease, which breach or default
remains uncured on the date hereof. Except as set forth on Schedule 5.01(f),
such party has not sent any written notice to any of its respective Tenants
occupying more than twenty five thousand (25,000) rentable square feet ("Major
Tenant") within the twelve (12) month period preceding the date hereof
asserting that such Major Tenant is in breach or default under any Lease to
which it is a party, which breach or default remains uncured on the date
hereof.
(g) Schedule 5.01(g) annexed hereto is a true, correct and complete
list of all ground leases under which such party is the ground lessee,
including all existing amendments and modifications thereto (collectively
"Ground Leases") affecting the Properties. To such party's knowledge, all
Ground Leases affecting the Properties are in full force and effect. Such
party has not given, nor has such party received, any written notice of a
material default (which remains uncured) under any Ground Lease.
(h) A true, correct and complete list of all agreements for the
payment of leasing commissions by the party holding the interest of landlord
with respect to the Properties under which such landlord is required to pay
any leasing commissions, brokerage fees or any other fee or charge that is due
and payable on or after the applicable Closing is set forth on Schedule
5.01(h) annexed hereto (such agreements are collectively referred to as the
"Brokerage Agreements").
(i) Schedule 5.01(i) annexed hereto contains a true, correct and
complete list of all Material Service Contracts. For purposes hereof,
"Material Service Contracts" shall mean all contracts (except for Leases,
Ground Leases and Brokerage Agreements) relating to the management, leasing,
operation, maintenance or repair of the Properties or that would otherwise
affect the use, operation or enjoyment of the Properties (collectively,
"Service Contracts") that are either (i) not terminable upon one month's
notice or less without payment or penalty; or (ii) for which the services
thereunder cost in excess of Seventy-Five Thousand ($75,000) Dollars per annum
with respect to any individual Property. To such party's knowledge, all of the
Material Service Contracts are in full force and effect and such party has not
received written notice of any material default thereunder. All Service
Contracts (other than those executed in contravention of the terms thereof)
shall be assigned to, and assumed by, the Relevant Contributee(s), as
applicable, at the respective Closing for the Properties affected by such
Service Contracts, to the extent such Service Contracts are assignable and all
necessary consents have been obtained.
(j) Except as set forth on Schedule 5.01(j) annexed hereto, (i)
there are currently no capital improvement projects commenced by such party
or, to such party's actual knowledge, costing more than Two Hundred Fifty
Thousand ($250,000) Dollars in the aggregate at any of the Properties other
than maintenance required in the ordinary course of business, (ii) to such
party's knowledge, there are no pending or threatened condemnation
proceedings, and (iii) except as set forth in the Leases no tenant has any
options, rights of first refusal or rights of first offer to purchase any of
the Properties.
(k) Except as disclosed in the reports listed on Schedule 5.01(k)
annexed hereto and/or any other environmental report or update thereto
obtained by the Company from a third party engineer or consultant prior to the
applicable Closing Date (the "Environmental Reports"), or as otherwise noted
on Schedule 5.01(k), to such party's knowledge, such party has not received
any written notification which remains uncured from any Governmental Authority
having jurisdiction over this Properties (A) stating that any hazardous
materials, hazardous substances, contaminants or pollutants
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have been stored, generated, disposed of, released or transported at, on or
from the Properties in violation of any environmental laws or regulations
applicable to the Properties, and there is no claim pending against such party
with respect to (x) any such violation applicable to the Properties, or (B)
with respect to any corrective or remedial action or cleanup relating to any
of the Properties, whether currently on-going or awaiting final governmental
approval, or (y) any further action letters relating to any of the Properties.
(l) All casualty insurance policies presently in effect with respect
to the Properties are in sufficient amounts and are on commercially reasonable
terms to provide for the "replacement costs" of each of the Properties and the
premiums for all such insurance policies have been paid in full through the
date hereof. Such party has received no written notice from any insurance
carrier that, if not corrected, would result in a termination of insurance
coverage or increase in the present cost thereof. To such party's knowledge,
all insurance policies presently in effect with respect to the Properties are
in full force and effect and either the policies or proceeds thereunder are
fully transferable to the Company.
(m) Such party does not have (i) any employees located at the
Properties or employees located elsewhere whose duties are primarily with
respect to the Properties or (ii) any pension plan liabilities, funded or
unfunded, or employee benefit plan(s), programs, agreements, or arrangements
of any kind pertaining to the Properties or any employees of such party
located at the Properties.
(n) Such party is not a "foreign person" as defined in the Internal
Revenue Code Section 1445, as amended (the "Code Withholding Section").
(o) Except as set forth on Schedule 5.01(o) annexed hereto, there is
no litigation, action, claim, suit, investigation, arbitration or other
adversarial contest or proceeding pending or, to such party's knowledge,
threatened, against such party with respect to any of the Properties or
relating to any of the Ground Leases or the Leases which would in the
aggregate have a material adverse affect on the Properties taken as a whole
(other than claims for personal injury, bodily injury or property damage which
are reasonably believed by such party to be covered by such party's existing
insurance policies).
(p) Except as set forth in Schedule 5.01(p), there are no
outstanding agreements with attorneys or consultants with respect to tax bills
for a Property that will bind the Relevant Contributees or the Properties
after the first full tax year after the applicable Closing.
(q) Such party, to its knowledge, has complied in all material
respects with (and, prior to each respective Closing, shall continue to comply
in all material respects with) the terms and provisions of the Permitted Debt
and corresponding Notes, Mortgages and all other documents securing the
Permitted Debt Loans (collectively, the "Permitted Debt Loan Documents"), and
all notices or correspondence received from the Permitted Debt Holder.
Schedule 5.01(q) annexed hereto is a true, correct and complete list of all
Permitted Debt Loan Documents. Such Notes and Mortgages are in full force and
effect, and such party has not received from the Lender thereunder a written
notice a default thereunder or under any of the Permitted Debt Loan Documents
(where default remains uncured). Such party has delivered to the Company or
its Agents true and complete copies of all Permitted Debt Loan Documents.
(r) Such party understands the risks of, and other considerations
relating to, the purchase of the Interests. Such party, by reason of its
business and financial experience, together with the business and financial
experience of those persons, if any, retained by it to represent or advise it
with respect to its investment in the Interests, (i) has such knowledge,
sophistication and experience in
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financial and business matters and in making investment decisions of this type
that it is capable of evaluating the merits and risks of an investment in the
Company and of making an informed investment decision, (ii) is capable of
protecting its own interest or has engaged representatives or advisors to
assist it in protecting its interests and (iii) is capable of bearing the
economic risk of such investment.
(s) Such party understands that an investment in the Company
involves substantial risks. Such party has been given the opportunity to make
a thorough investigation of the proposed activities of the Company and has
been furnished with materials relating to the Company and its proposed
activities. Such party has been afforded the opportunity to obtain any
additional information deemed necessary by such party to verify the accuracy
of any representations made or information conveyed to such party. Such party
confirms that all documents, records, and books pertaining to its investment
in the Company and requested by such party have been made available or
delivered to such party. Such party has had an opportunity to ask questions
and receive answers from the Company, or from a person or persons acting on
the Company's behalf, concerning the terms and conditions of this investment.
(t) The Interests to be issued to such party will be acquired by
such party for its own account for investment only and not with a view to, or
with any intention of, a distribution or resale thereof, in whole or in part,
or the grant of any participation therein, without prejudice, however, to such
party's right (subject to the terms of the Interests) at all times to sell or
otherwise dispose of all or any part of its Interests under an exemption from
such registration available under the Securities Act of 1933, as amended (the
"Securities Act"), and applicable state securities laws, and subject,
nevertheless, to the disposition of its assets being at all times within its
control. Such party was not formed for the specific purpose of acquiring an
interest in the Company.
(u) Such party acknowledges that, except as expressly set forth in
this Agreement or in the LLC Agreement, (i) the Interests to be issued to such
party have not been registered under the Securities Act or state securities
laws by reason of a specific exemption or exemptions from registration under
the Securities Act and applicable state securities laws and, if such Interests
are represented by certificates, such certificates will bear a legend to such
effect, (ii) the Company's reliance on such exemptions is predicated in part
on the accuracy and completeness of the representations and warranties of such
party contained herein, (iii) such Interests, therefore, cannot be resold
unless registered under the Securities Act and applicable state securities
laws, or unless an exemption from registration is available, (iv) there is no
public market for such Interests, and (v) the Company has no obligation or
intention to register such Interests for resale under the Securities Act or
any state securities laws or to take any action that would make available any
exemption from the registration requirements of such laws. Such party hereby
acknowledges that because of the restrictions on transfer or assignment of
such Interests to be issued hereunder which will be set forth in the LLC
Agreement and/or in a registration rights agreement, such party may have to
bear the economic risk of the investment commitment evidenced by this
Agreement and any Interests acquired hereby for an indefinite period of time.
(v) Such party has prepared and timely filed all tax returns
required to be filed by it on or before the date hereof with respect to the
Properties, which tax returns are true, correct and complete in all material
respects. Such party has paid or made provision for the payment of all taxes
with respect to the ownership and operation of the Properties that are due or
claimed 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
given written notice to such party of any tax deficiency, lien, interest or
penalty or other assessment against such party which has not been paid and no
audit or written inquiry has been commenced or, to the best of such party's
knowledge, threatened by any federal, state, local or foreign tax authority
relating to such party that may be expected to result in a tax deficiency,
lien, interest or other
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assessment against the assets of such party. Contributor shall pay any and all
taxes imposed on the Company based on Contributor's failure to comply with any
bulk sales law.
(w) Schedule 7.07 is a true, correct and complete list of all
Required Consents.
(x) The applicable Contributed Interests have not been assigned,
pledged or otherwise encumbered or transferred, and are not subject to any
pledges, liens or other encumbrances. There are no attachments, executions or
assignments for the benefit of creditors or voluntary proceedings in
bankruptcy or under any other debtor relief laws pending or (to such party's
knowledge) threatened by or against such party or otherwise affecting such
Contributed Interests. Except for the Contributed Interests owned by such
party, such party does not own any interest in, nor does such party have any
ownership rights in respect of, the Property to which the Contributed
Interests relate, and from and after the transfer of such Contributed
Interests to Purchaser, such party shall not own any interest in, nor have any
ownership rights in respect of, the Property or the entity to which the
Contributed Interests relate.
5.02. Relevant Contributees Representations and Warranties. The Company
represents and warrants to Contributor as to itself and as to and on behalf of
all of the other Relevant Contributees, if applicable, as follows:
(a) Such party is (a) a limited liability company, organized,
existing and in good standing under the laws of the State of Delaware and has
the requisite power and authority to enter into and perform the terms of this
Agreement, including to issue the Interests to Contributor to the extent
called for in accordance with the terms of this Agreement and the LLC
Agreement and (b) has, since its formation or its acquisition (directly or
indirectly) by the REIT, been classified for federal income tax purposes as a
partnership or disregarded entity and not as a corporation or an association
taxable as a corporation, or a "publicly traded partnership" within the
meaning of Section 7704(b) of the Code.
(b) The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby on the part of such party
has been duly authorized by all necessary limited liability company action and
no other proceedings on the part of such party are necessary in order to
permit it to consummate the transactions contemplated hereby.
(c) This Agreement has been duly executed by such party and all of
such party's obligations hereunder are the legal, valid and binding
obligations of such party, enforceable in accordance with the terms of this
Agreement, subject to applicable bankruptcy, insolvency, reorganization,
moratorium, fraudulent transfer and other similar laws relating to or
affecting creditors' rights generally from time to time in effect and to
general principles of equity (including concepts of materiality,
reasonableness, good faith and fair dealing), regardless whether considered in
a proceeding in equity or at law.
(d) Such party's performance of its duties under this Agreement will
not conflict with, result in a breach of or be a default under, or be
adversely affected by, any existing agreements, instruments, judgments,
permits, orders, rules, regulations or decrees to which such party is a party
or by which it or its assets are bound.
(e) Such party is not the subject of any bankruptcy, reorganization,
insolvency or similar proceedings.
(f) The Interests to be issued in connection with the transactions
contemplated herein will be duly authorized and validly issued in accordance
with the terms of the LLC
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Agreement and, assuming the accuracy of Contributor's representations and
warranties, in compliance with federal and applicable state securities laws,
and will be, in connection with the transactions contemplated herein, fully
paid and non-assessable with no preemptive rights, and the Interests to be
issued in connection with the transactions contemplated herein will be issued
upon the terms provided in the LLC Agreement, as the same is to be amended as
permitted or required hereunder. Except as created by this Agreement, as of
the date hereof, there are no outstanding subscriptions, options, warrants,
preemptive or other rights or other arrangements or commitments obligating the
Company to issue any Interests. At each Closing, upon receipt by Contributor
of the Contribution Consideration applicable for such Closing in exchange for
Interests, the Company will issue the Interests to be issued hereunder free
and clear of all liens other than those suffered or permitted or granted by
Contributor and, as of such Closing, such Contributor will be admitted as a
member of the Company. The issuance of the Interests to Contributor at each
Closing will not require any approval or consent of any person except any such
approval as shall have been obtained on or prior to such Closing Date.
5.03. REIT Representations and Warranties. The REIT represents and
warrants to Contributor as follows:
(a) The REIT is a corporation, organized, existing and in good
standing under the laws of the State of Maryland and has the requisite power
and authority to enter into and perform the terms of this Agreement.
(b) The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby on the part of the REIT
have been duly authorized by all necessary limited liability company action
and no other proceedings on the part of the REIT are necessary in order to
permit it to consummate the transactions contemplated hereby.
(c) This Agreement has been duly executed by the REIT and all of the
REIT's obligations hereunder are the legal, valid and binding obligations of
the REIT, enforceable in accordance with the terms of this Agreement, subject
to applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
transfer and other similar laws relating to or affecting creditors' rights
generally from time to time in effect and to general principles of equity
(including concepts of materiality, reasonableness, good faith and fair
dealing), regardless whether considered in a proceeding in equity or at law.
(d) The REIT's performance of its duties under this Agreement will
not conflict with, result in a breach of or be a default under, or be
adversely affected by, any existing agreements, instruments, judgments,
permits, orders, rules, regulations or decrees to which the REIT is a party or
by which it or its assets are bound.
(e) The REIT is not the subject of any bankruptcy, reorganization,
insolvency or similar proceedings.
(f) The REIT is in compliance with the Uniting and Strengthening
America by Providing Appropriate Tools Required to Intercept and Obstruct
Terrorism Act of 2001 , and the regulations promulgated thereunder (the
"Patriot Act"), and comparable regulations. None of the funds contributed to
the REIT have or will be derived from illegal activities or made in
contravention of any United States anti-money laundering laws or regulations.
Neither the REIT nor any of its beneficial owners (i) is or will be subject to
United States trade sanctions or included on any United States government
published lists of terrorists or terrorist organizations and (ii) is a
"foreign shell bank" as defined under the Patriot Act.
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5.04. (a) Survival of Contributor Representations and Warranties;
Modification Thereof. The representations and warranties in this Agreement by
Contributor are made as of the date hereof, and shall be remade by Contributor
as of the date of each Closing (as applicable to the Properties or the
Interests being contributed or sold to the Company, and/or the SPE Entities,
as applicable, at such Closing) with the same force and effect as if in fact
specifically remade at that time. If facts or circumstances arising after the
date hereof render Contributor unable to remake a representation or warranty
in any material respect as of such Closing, and Contributor specifically so
advises the Company, in writing and prior to such Closing (including, without
limitation, by amendment of the schedules hereto), of the particular
circumstances rendering any representation or warranty untrue in any material
respect, or if the same is disclosed in writing in an update to any Title
Commitment, Search or third party report commissioned by the Company in
connection with its review of the Properties, the failure to remake such
representation and warranty shall not constitute a default hereunder by
Contributor, except (in each case) in the event or to the extent that the
untruth of such representation or warranty is the result of any act or
omission of Contributor and/or its Agents in breach or violation of the terms
of this Agreement; notwithstanding the foregoing, the truth and accuracy of
all representations and warranties made by Contributor in this Agreement
(required to be true in all material respects as of an applicable Closing Date
pursuant to Section 10.01(b)), as modified to reflect the operation of the
Properties from and after the date hereof in the ordinary course (including,
without limitation, leasing activities with respect thereto) or as otherwise
permitted in accordance with the terms of this Agreement, shall be a condition
precedent to the Company's obligation hereunder at each Closing.
Notwithstanding the foregoing, the parties acknowledge that if an item is (a)
disclosed only on one schedule such disclosure shall be deemed to be disclosed
on any other relevant schedule to the extent such item is relevant to the
representation or warranty in question, and to the extent such item is
inconsistent with such other schedule, the disclosure of such item on any
schedule shall be deemed to modify the incorrect representation and (b)
disclosed in any third party report delivered in writing by Contributor to the
Company, such disclosure shall be deemed to modify the relevant representation
and warranty. The representations and warranties contained in Subparagraphs
5.01(a), (b) and (c) shall survive the Closing, and the representations and
warranties in Subparagraph 5.01(w) shall survive the Closing for a period
equal to the applicable statute of limitations plus three months. Except as
provided in the immediately preceding sentence and in the next sentence, all
other representations and warranties made in this Agreement by Contributor
shall survive the applicable Closing for twelve (12) months from each such
Closing (the "Rep Survival Period") and shall not merge into any instrument of
conveyance delivered at the Closing. "Contributor's Knowledge" shall be
defined for purposes of this Agreement as the current actual (not
constructive, imputed or implied) knowledge, without any duty of inquiry or
investigation, of the Contributor. The provisions of this Section 5.04(a)
shall survive the Closing.
(b) Survival of Company and REIT Representations and Warranties. The
representations and warranties in this Agreement by the Company and the REIT
are made as of the date hereof and shall be remade by the Company and the REIT
and as of each Closing. The representations and warranties in Subparagraphs
5.02(a), (b), (c) and (d) and Subparagraphs 5.03(a), (b), (c) and (d) shall
survive the Closing. All other representations and warranties of the Company
and the REIT, if any, shall survive the applicable Closing for the Rep
Survival Period and shall not merge into any instrument of conveyance
delivered at the Closing. The provisions of this Section 5.04(b) shall survive
the Closing.
5.05. (a) Indemnification by Contributor; Cap; Basket. Notwithstanding
anything to the contrary in this Agreement, but subject to (i) the immediately
succeeding sentence, (ii) Section 2.01(d), and (iii) the Cap (as hereinafter
defined), Contributor agrees to and does hereby indemnify, defend and hold
harmless the Company, the SPE Entities and the REIT, their respective
constituents and Agents, and their successors and assigns, from and against
any and all liabilities, claims, demands, suits, administrative proceedings,
causes of action, costs, damages, personal injuries and property damages,
losses and expenses (including, without limitation, reasonable attorneys' or
other consultants' fees and
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disbursements, but excluding consequential, punitive, special and other
indirect damages), both known and unknown, present and future, at law or in
equity (collectively, "Losses") arising out of, by virtue of, or related to, a
breach or inaccuracy of any representation, warranty or covenant of
Contributor contained in Section 5.01 or Section 15.01. Notwithstanding the
foregoing, no claim for a breach or inaccuracy of any representation, warranty
or covenant of Contributor contained in Section 5.01 or 15.01 shall be
actionable or payable (x) unless the valid claims for all such breaches and
inaccuracies collectively aggregate more than Five Hundred Thousand Dollars
($500,000) (the "Basket") with respect to all Properties, in which event the
amount of all claims in excess of such $500,000 threshold shall be actionable,
and (y) unless written notice containing a description of the specific nature
of such breach or inaccuracy shall have been given by the Company to
Contributor prior to the expiration of the Rep Survival Period. The Company,
the SPE Entities and the REIT agree to first seek recovery (using commercially
reasonable efforts to do so) under any insurance polices, Service Contracts,
Leases, Title Policies, Ground Lease or any other agreement for which such
recovery is available prior to seeking recovery from Contributor, and
Contributor shall not be liable to the Company, the SPE Entities or the REIT
to the extent such party's claim is satisfied from such insurance policies,
Service Contracts, Leases or Title Policies, Ground Leases or any other
agreement for which such recovery is available. Notwithstanding anything
contained herein to the contrary, in no event shall Contributor's aggregate
liability to the Company, the SPE Entities or the REIT for breach or
inaccuracy of any representation or warranty or covenant of Contributor in
this Agreement or as remade as of any Closing Date pursuant to Section 5.04,
or in any other way related to this Agreement and the transactions
contemplated hereby, exceed the amount of the Cap. As used in this Section
5.05, the term "Cap" shall mean the total aggregate amount of Twenty Five
Million and 00/100 Dollars ($25,000,000.00). Notwithstanding anything to the
contrary contained herein, no claim for a breach or inaccuracy of any
representation or warranty or covenant of Contributor shall be actionable or
payable if the breach or inaccuracy in question results from or is based on
(i) a condition, state of facts or other matter expressly disclosed in any
Review Materials as of the date hereof or in any Schedule attached to this
Agreement, or (ii) if the inaccuracy of, or failure to make, such
representation or warranty as of the applicable Closing does not constitute a
breach, default or violation pursuant to the second sentence of Section
5.04(a). Notwithstanding anything to the contrary in this Section 5.05(a), the
Cap, the Basket and the Rep Survival Period shall not be applicable to Losses
arising from or in connection with the matters described on Schedule 5.05(a)
of this Agreement (the "Special Indemnification Matters"), it being agreed
that Contributor shall and does hereby indemnify, defend and hold harmless the
Company, the SPE Entities and the REIT, their respective constituents and
Agents, and their successors and assigns, from and against any Losses arising
out of, by virtue of, or related to, (x) a breach or inaccuracy of any
representation, warranty or covenant of Contributor relating to the Special
Indemnification Matters or (y) otherwise relating to the Special
Indemnification Matters.
(b) Indemnification by Company; Cap; Basket. Notwithstanding
anything to the contrary in this Agreement, but subject to the immediately
succeeding sentence and to the last sentence of this Section 5.05(b), the
Company and the REIT agree to and do hereby indemnify, defend and hold
harmless Contributor, its partners, members, shareholders, officers and
directors, and their respective Agents, Affiliates and each of their
successors and assigns, from and against any Losses arising out of, by virtue
of, or related to (i) a breach or inaccuracy of any representation, warranty
or covenant of the REIT or the Company contained in Section 5.02, 5.03 or
16.01 hereof, or (ii) a release, emission, discharge or disposal of any
reportable quantities of hazardous materials, hazardous substances,
contaminants or pollutants at or from any of the Properties in violation of
any U.S. Federal or state environmental laws or regulations applicable to the
Properties to the extent such violation occurs subsequent to the applicable
Closing Date or before any applicable Closing Date if such release, emission,
discharge or disposal was caused by or at the direction of the Company or the
REIT. Contributor agrees (and agrees to cause the applicable Contributee) to
first seek recovery (using commercially reasonable efforts to do so) under any
insurance policies, Service Contracts, Leases, Title Policies, Ground Leases
or
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any other agreement for which such recovery is available prior to seeking
recovery from the Company or the REIT, and the Company and the REIT shall not
be liable to Contributor to the extent the Contributor's claim is satisfied
from such insurance policies, Service Contracts, Leases, Title Policies,
Ground Leases or any other agreement for which such recovery is available.
(c) Exculpation. Notwithstanding anything to the contrary in this
Agreement, but subject to the terms and provisions of Section 5.05(b), neither
party hereto, nor any member or any general or limited partner of such party,
whether direct or indirect, nor any direct or indirect member or any general
or limited partner in such party, nor any disclosed or undisclosed officers,
shareholders, members, principals, directors, employees, partners, servants,
Agents or Affiliates of either party and each of their successors or permitted
assigns, shall have any personal liability with respect to any provisions of
this Agreement and, if after the Tranche 1 Closing Date any party is in breach
or default with respect to its respective obligations or otherwise, the other
party hereto shall look solely to such breaching or defaulting party's
interest in and to the Interests or the proceeds from the sale of the
Properties (subject, in each case, to Section 5.05(a) of this Agreement) for
the satisfaction of remedies hereunder.
(d) Procedures Regarding Indemnification. If a claim or demand for
indemnification is based upon an asserted liability or obligation to a person
or entity not a party to this Agreement nor a permitted successor or assign (a
"Third Party Claim"), then the indemnified party shall give prompt (within the
time required for the filing of any responsive pleading in the case of
litigation) written notice of any such claim to the indemnifying party. The
indemnifying party may defend or settle such claims or actions with counsel
chosen and paid by it by giving written notice (the "Election to Defend") to
the indemnified party within thirty (30) days after the date such notice of a
Third Party Claim is received by the indemnifying party; provided, however,
that the indemnifying party may not settle such claims or action without the
consent of the other party to this Agreement, which consent shall not be
unreasonably withheld, if the indemnified party will not be fully released in
connection therewith. Such notice and opportunity shall be conditions
precedent to any liability of the indemnifying party under this Agreement.
Notwithstanding anything to the contrary in this Agreement, a failure to
provide or delay in providing any required notice shall not prejudice any
right to indemnification under this Agreement except to the extent that the
indemnifying party is prejudiced by such failure. In no event shall the
provisions of this subsection reduce or lessen the obligations of the
indemnifying party under this subsection, if prior to the expiration of such
thirty (30) day notice period, the indemnified party shall respond to a Third
Party Claim if such action is reasonably required to minimize damages or avoid
a forfeiture or penalty or because of a requirement imposed by law. If the
indemnifying party does not duly give the Election to Defend as provided
above, then it shall be deemed to have irrevocably waived its right to defend
or settle such claims, but it shall have the right, at its expense, to attend,
but not otherwise participate in, proceedings with such third parties; and if
the indemnifying party does duly give the Election to Defend, then the
indemnified party shall have the right at its expense, to attend, but not
otherwise participate in, such proceedings. The indemnified party (or its
designee) shall have the right, to the extent permitted by law or regulation,
by written notice given to the indemnifying party at any time, to assume
exclusive control of the defense of any claim insofar as the indemnified party
is concerned, but, subject to the immediately succeeding sentence, the giving
of such notice shall result in the indemnifying party being relieved of its
obligations in respect of such claim under this Agreement. If at any time
during the pendency of a claim the indemnifying party shall disaffirm its
responsibility for such claim, the indemnified party (or its designee) shall
have the right, but not the obligation, to assume the exclusive control of the
defense and settlement of such claim insofar as the indemnified party is
concerned, and all costs and expenses of such defense shall be paid by the
indemnifying party if such claim is within the scope of the indemnification
obligations of the indemnifying party under this Agreement.
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Section 6. Acknowledgments of the Company
6.01. No Prior Representations or Warranties. The Company acknowledges
that except as expressly set forth in this Agreement, neither Contributor nor
any agent or representative or purported agent or representative of
Contributor has made, and Contributor is not liable for or bound in any manner
by, any express or implied warranties, guaranties, promises, statements,
inducements, representations or information (including, without limitation,
any information set forth in offering materials heretofore furnished to the
Company) pertaining to the Properties or any part thereof, the physical
condition thereof, environmental matters, income, expenses or operation
thereof or the uses which can be lawfully made of the same under applicable
zoning or other laws or any other matter or thing with respect thereto,
including, without limitation, any existing or prospective leases, operating
agreements or other agreements. Without limiting the foregoing, the Company
acknowledges and agrees that, except as expressly set forth in this Agreement
or any other agreement or document entered into by the parties in connection
with the transaction contemplated hereby, Contributor is not liable for or
bound by (and the Company has not relied upon) any verbal or written
statements, representations, real estate brokers' "set-ups" or offering
materials or any other information respecting the Properties furnished by
Contributor or any broker, employee, agent, consultant or other person
representing or purportedly representing Contributor. Accordingly, Contributor
is entering into this Agreement based upon the Company's assurances that the
Company has a well-informed opinion of the value of the Properties. The
Company is not relying upon any representations made by Contributor regarding
market conditions which influence the Properties such as competitive position
relative to its existing and potential future competitors, market rental rates
achievable at the Properties, vacancy assumptions, credit loss and downtime
reserves, project growth rates (if any) in rents or expenses, impact of the
contribution and sale on assessed values, tenant work and leasing fee levels
necessary to generate estimated market rents, tenant retention ratios and the
need for an amount of any "capital reserves". The provisions of this Section
6.01 shall survive each Closing.
6.02. As-Is. The Company acknowledges that it has, prior to the date
hereof, inspected the Properties, the physical and environmental condition and
the uses thereof, and the fixtures, equipment and personal property included
in this contribution and acquisition to its satisfaction, and the Company has
independently investigated, analyzed and appraised the value and profitability
thereof, the creditworthiness of tenants, and the presence of hazardous
materials, if any, in or on the Properties, that they have received or had
made available to them by Contributor, on or prior to the date hereof, copies
of and/or has reviewed the Review Materials and other agreements and documents
referred to or contemplated herein, that they are thoroughly acquainted with
all of the foregoing and that the Company, in entering into this Agreement,
will rely exclusively upon their own independent investigations, analyses,
studies and appraisals and not upon any information provided to the Company by
or on behalf of Contributor with respect thereto. AT EACH CLOSING, THE COMPANY
AGREES TO ACCEPT THE PROPERTIES CONTRIBUTED OR SOLD TO THE COMPANY AND/OR THE
SPE ENTITIES, AS APPLICABLE, AT SUCH CLOSING IN "AS IS, WHERE IS" CONDITION,
EXCEPT FOR CONTRIBUTOR'S REPRESENTATIONS, WARRANTIES OR COVENANTS EXPRESSLY
CONTAINED IN THIS AGREEMENT, WITH ALL FAULTS AS OF THE DATE HEREOF AND
SPECIFICALLY AND WITHOUT ANY WARRANTIES, REPRESENTATIONS OR GUARANTEES, EITHER
EXPRESS OR IMPLIED AS TO (I) THE CONDITION, FITNESS FOR ANY PARTICULAR
PURPOSE, OR MERCHANTABILITY OF SUCH PROPERTIES, (II) THE STRUCTURAL INTEGRITY
OF SUCH PROPERTIES, (III) THE ACCURACY OR COMPLETENESS OF ANY INFORMATION,
DATA, MATERIALS OR CONCLUSIONS CONTAINED IN ANY INFORMATION PROVIDED TO THE
COMPANY FROM ANY SOURCE WHATSOEVER, EXCEPT AS OTHERWISE EXPRESSLY PROVIDED
HEREIN, (IV) ENVIRONMENTAL MATTERS PERTAINING TO SUCH PROPERTIES EXCEPT AS SET
FORTH HEREIN, OR (V) ANY OTHER WARRANTY OF ANY KIND, NATURE OR TYPE WHATSOEVER
FROM CONTRIBUTOR,
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EXCEPT AS MAY BE EXPRESSLY PROVIDED HEREIN, REASONABLE WEAR AND TEAR AND
DAMAGE BY FIRE OR OTHER CASUALTY (SUBJECT TO THE PROVISIONS OF SECTION 8.01)
BETWEEN THE DATE HEREOF AND THE APPLICABLE CLOSING DATE EXCEPTED, AND THE
COMPANY SHALL ASSUME (SUBJECT TO THE PROVISIONS HEREOF AND APPLICABLE LAW) THE
RISK THAT ADVERSE MATTERS, INCLUDING BUT NOT LIMITED TO, CONSTRUCTION DEFECTS
AND ADVERSE PHYSICAL AND ENVIRONMENTAL CONDITIONS MAY NOT HAVE BEEN REVEALED
BY THE COMPANY'S INVESTIGATIONS.
6.03. Environmental Matters. With respect to all matters disclosed in the
Environmental Reports, Contributor and the Company agree that the Company
shall not have the right to bring any claim against Contributor for any
environmental matters or violation of any environmental laws with respect to
the matters disclosed in such Environmental Report and the Company waives all
the rights (at law, in equity or otherwise) to implead Contributor in any
action brought with respect to such environmental matters and waives all
rights of contribution against Contributor in connection therewith, provided,
however, that the foregoing shall not be deemed to affect or limit the
indemnification obligations of Contributor set forth in Section 5.05(a)
regarding the Special Indemnification Matters. The provisions of this Section
6.03 shall survive any applicable Closing indefinitely.
Section 7. Contributor's Obligations as to the Properties
7.01. Operation of Properties Prior to Closing. Prior to each Closing for
each respective Property, Contributor agrees that it shall maintain, repair,
lease, manage and operate the Properties in substantially the same manner as
Contributor has operated, managed, leased, maintained and repaired the
Properties prior to the date of this Agreement. As it relates to each
Property, from and after the date hereof and through the Closing Date for each
such Property, or earlier termination of this Agreement, Contributor shall not
(a) remove any material assets, fixtures, equipment or personal property
therefrom (not including any of the foregoing items to the extent owned by
tenants or other occupants of the Properties) unless the same are replaced
with similar items of at least equal quality prior to the Closing, (b) modify
or amend in any material respect adverse to the landlord, extend, renew or
terminate any material Service Contract, Brokerage Agreement or existing
property management contracts (except as set forth in Section 7.08) or enter
into any new Service Contract (except as set forth in Section 7.02), Brokerage
Agreement or existing property management contracts, without the prior consent
of the Company, which consent shall not be unreasonably withheld, conditioned
or delayed, (c) accept rent from any tenant more than one (1) month in advance
(except as otherwise consistent with past practice), and (d) amend any Lease
in any material respect adverse to the landlord thereunder or enter into any
new or renewal lease, license or other agreement for other than customary and
market terms affecting the ownership or operation of all or any portion of any
Property, without the prior consent of the Company, which consent shall not be
unreasonably withheld, conditioned or delayed; provided, however, Contributor
may amend any Lease, or execute any new or renewal lease, license or other
agreement to the extent consistent with (or more favorable to the landlord
than) the DYNA Models without the prior consent of the Company. Any Lease or
Service Contract submitted in writing by Contributor to the Company for
approval and not objected to in a writing given by the Company to Contributor
within five (5) Business Days after the Company's receipt thereof shall be
deemed approved by the Company. For purposes of this Agreement, the term
"Business Days" shall mean any day other than a Saturday, Sunday and bank
holiday in New York State; if any date on which a party hereunder is required
to perform or pay any amount is not a Business Day, then such date shall be
deemed to occur on the next immediately succeeding Business Day.
7.02. Certain Lease/Service Contract Actions. Notwithstanding anything to
the contrary in Section 7.01, prior to the applicable Closing, Contributor
may, without the Company's prior consent, terminate or modify any Lease or
Service Contract for a Property to be contributed or sold to the
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Company at such Closing by reason of a material default by the tenant (other
than a Major Tenant) or service provider, as applicable, beyond the expiration
of any applicable grace or cure period in the payment of rent or Additional
Rent, the performance of any other material obligation or the provision of
services; provided, however, that such termination or modification is in
accordance with the terms of such agreement or otherwise permissible pursuant
to this Agreement. In addition, prior to the applicable Closing, Contributor
may, with the Company's prior consent, which consent may be withheld in
Company's sole discretion, terminate or modify any Lease with a Major Tenant
by reason of a material default by such Major Tenant beyond the expiration of
any applicable grace or cure period in the payment of rent or additional rent
and/or the performance of any other material obligation. Any such termination
by Contributor prior to such Closing shall not affect the obligations of the
Company under this Agreement in any manner or entitle the Company to an
abatement of or credit against the applicable Cash Portion of the Sales Price
or give rise to any other claim on the part of the Company.
7.03. Certain Prohibited Actions. During the term of this Agreement,
subject to any expressly permissive provisions of this Agreement to the
contrary (including Section 18 of this Agreement), Contributor shall not (i)
unless the Property has been substituted for another property not otherwise
included in the Tranche 1, Tranche 2 or Tranche 3 Properties, as applicable,
and such Property is no longer intended by the parties to be transferred to a
Relevant Contributee pursuant to this Agreement, (A) enter into any written
agreement for the sale of such Property with any other party, (B) transfer,
mortgage or pledge any interest in any such Property, except as expressly
provided for herein with respect to Leases or in connection with any Permitted
Debt, (C) contract for or commence any material construction, capital
improvement or deferred maintenance at any such Property, unless required to
do so hereunder, under the Leases, if requested by any tenant at such tenant's
expense, as required by any law or as a result of an emergency (provided
Contributor shall provide notice thereof to the Company as soon as is
practical), (D) without the prior written consent of the Company, not to be
unreasonably withheld, conditioned or delayed, institute prior to the
applicable Closing Date, any proceeding or application for a reduction in the
real estate tax assessment of the Property or any other relief for any tax
year unless such taxes are being contested in good faith and either the taxes
being so contested have been paid in full if so required by the applicable
taxing authority or adequate reserves for the payment of such taxes have been
established by Contributor which in such instance shall not require the
Company's consent, and if Contributor receives any payment of a rebate of
taxes in its favor, Contributor will remit to any tenant of the Properties all
or any portion of such rebated sums which is owed to such tenant, or (ii)
enter into any employment contract, employee benefit plan, program, agreement
or arrangement of any kind, union contract or pension plan which will be
binding on the Company upon any Closing.
7.04. Maintenance of Insurance. Contributor shall maintain in full force
and effect until each applicable Closing all material insurance policies
applicable to the Properties or any replacements thereof, and shall renew
those expiring before such applicable Closing for no more than one year
without the Company's prior written consent, such that at all times from the
date hereof through the applicable Closing Date there shall be no lapse in
such insurance coverage as existed on the date hereof.
7.05. Required Tenant Estoppels; Contributor Estoppel. Prior to (but in
no event earlier than ninety (90) days prior to) the Tranche 1 Closing, the
Tranche 2 Closing and the Tranche 3 Closing, and as a condition to the Tranche
1 Closing, the Tranche 2 Closing and the Tranche 3 Closing, respectively,
Contributor shall provide to the Company estoppel certificates in the form of
Exhibit E annexed hereto ("Tenant Estoppels") from such tenants representing
at least seventy (70%) percent of total leased rentable square footage under
all of the Leases in effect as of the date hereof with respect to the Tranche
1 Properties, the Tranche 2 Properties and the Tranche 3 Properties and the
Tranche 1 Closing, the Tranche 2 Closing and the Tranche 3 Closing,
respectively. Notwithstanding the foregoing, if Contributor is unable to
obtain the Tenant Estoppels with respect to any Properties (other than one of
the Properties listed on Schedule 7.05 annexed hereto (the "Loan
Properties")), Contributor may deliver
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to the Company at the applicable Closing substitute estoppel certificates
signed by Contributor (each a "Contributor Estoppel") representing up to
fifteen (15%) percent of the total leased rentable square footage under all
Leases in effect as of the date hereof and the Company shall accept in lieu of
such Tenant Estoppel signed by the tenants such Contributor Estoppels. No
Substitute Ground Lessor Estoppel (as defined hereinafter) shall be counted
against the aforementioned fifteen percent (15%) threshold. In the event that
a tenant under a Lease subsequently provides the Company with a Tenant
Estoppel with respect to a Lease for which Contributor has given the Company a
Contributor Estoppel, the Company shall retain and rely on such Tenant
Estoppel, and the Contributor Estoppel given for such Lease will be of no
further force and effect from and after the date on which such Tenant Estoppel
is delivered to the Company, but only to the extent that such Tenant Estoppel
confirms the pertinent statements made in such Contributor Estoppel. Prior to
(but in no event dated earlier than ninety (90) days prior to the Tranche 2
Closing Date, or the Tranche 3 Closing Date, respectively). Notwithstanding
anything to the contrary in this Agreement, Contributor's obligations and
liabilities under this Agreement with respect to any Contributor Estoppel
shall not be subject to the Cap, the Basket or the Representation Survival
Period.
7.06. Landlord Estoppels. Prior to (but in no event dated earlier than
ninety (90) days prior to the applicable Closing Date) and as a condition to
the applicable Closing with respect to such Property, Contributor shall use
its commercially reasonable efforts to provide to the Company additional
estoppel certificates from each lessor under a Ground Lease in the form of
Exhibit F annexed hereto ("Landlord Estoppel"), provided, that, Contributor
shall be deemed to have complied with its obligations under this Section 7.06
to deliver any estoppel certificate or document so required hereunder from a
particular ground lessor, to the extent that such ground lessor delivers such
estoppel certificate or document in the form prescribed by the applicable
Ground Lease. If, notwithstanding such commercially reasonable efforts,
Contributor is unable to obtain any Landlord Estoppels in respect of any
Ground Leases, Contributor shall be required to deliver at the applicable
Closing a substitute estoppel certificate signed by Contributor (each a
"Substitute Ground Lessor Estoppel"). Notwithstanding anything to the contrary
in this Agreement, Contributor's obligations and liabilities under this
Agreement with respect to any Substitute Ground Lessor Estoppel shall not be
subject to the Cap, the Basket or the Representation Survival Period.
7.07. Required Consents. Prior to and as a condition to the Tranche 1
Closing, the Tranche 2 Closing and the Tranche 3 Closing, as applicable,
Contributor shall deliver to the Company any consents required to consummate
the transactions contemplated by this Agreement, which such consents are
listed on Schedule 7.07 annexed hereto (the "Required Consents").
7.08. Termination of Existing Property Management Agreements. Contributor
shall terminate, at Contributor's sole cost and expense, in writing all
existing property management contracts (a) for the Tranche 1 Properties, on or
prior to the Tranche 1 Closing, (b) for the Tranche 2 Properties, on or prior
to the Tranche 2 Closing, and (c) for the Tranche 3 Properties, on or prior to
the Tranche 3 Closing.
7.09. Compliance With Permitted Debt Loan Documents. Until the applicable
Closing occurs, Contributor shall comply in all material respects with the
requirements, obligations and liabilities under any Permitted Debt Loan
Documents. Contributor agrees that subject to Section 13.01(j) and 13.07(a),
the Company shall only be responsible for (i) the principal amount of the
Notes and Mortgages outstanding as of the date of the respective Closing for
the Permitted Debt Properties, (ii) the payment of principal and interest on,
and the performance of all other obligations with respect to the period from
and after the applicable Closing under the Notes and Mortgages accruing from
and after the respective Closing for the Permitted Debt Properties and (iii)
any amounts with respect to the period prior to the applicable Closing for
which the Company receives a credit at such Closing (including, without
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limitation, accrued unpaid interest on any such Permitted Debt). This Section
7.09 shall survive each Closing.
7.10. Cooperation Regarding Financing. Contributor and the Relevant
Contributees shall cooperate, in all commercially reasonable respects, with
requirements of any lender regarding the Permitted Debt, provided that the
Company shall reimburse Contributor for any costs incurred in connection
therewith.
7.11. Assignment of Environmental Insurance Policy. Contributor shall use
commercially reasonable efforts to assign, indorse or otherwise transfer the
benefits of the environmental insurance policy (together with any amendments,
modifications, or supplements thereof, the "Environmental Insurance Policy")
relating to the Property located at 225 High Ridge Road, Stamford, Connecticut
(the "225 High Ridge Property"), effective as of the applicable Closing, to
the Relevant Contributee.
Section 8. Destruction, Damage or Condemnation
8.01. (a) Casualty and Condemnation. If, at any time, an amount of the
Properties greater than or equal to (as reasonably determined by Contributor)
fifteen percent (15%) or more of the Total Consideration of the Properties to
be contributed to the Company is damaged or destroyed by fire or other
casualty ("Casualty") or is taken by eminent domain (or is the subject of a
pending condemnation proceeding that has not been reduced to judgment)
("Condemnation"), on an aggregate basis, then Contributor shall notify the
Company of such fact and, subject to Section 8.01(b) of this Agreement, the
Company shall have the right to terminate this Agreement with respect to all
remaining Tranches by giving written notice to Contributor, provided, however,
that the Company shall be deemed to have elected to proceed with the
acquisition if the Company fails to notify Contributor of its election within
ten (10) Business Days of receipt of such notice. In the case of Casualty, if
the Company elects, or is deemed to have elected, to proceed with the
acquisition of the Property or Properties, then the Company shall accept title
to the Property or Properties in their existing condition, in which event
Contributor shall, subject to the requirements of any financing encumbering
the Property or Properties, assign to the Company, at the applicable Closing,
all of Contributor's right, title and interest in and to the insurance
proceeds awarded or to be awarded to Contributor as the result of such damage
or destruction to such Properties and the Contributed Equity Value or Cash
Portion of Sales Price, as applicable, shall be reduced by the amount of any
deductible in connection with the subject casualty. In the case of
Condemnation, if the Company elects, or is deemed to have elected, to proceed
with the acquisition of the Property or Properties (other than the portion so
taken), then the Company shall accept title to the Property or Properties in
their existing condition, and Contributor shall, subject to the requirements
of any financing encumbering the Property or Properties, assign and turn over
to the Company at the applicable Closing, and the Company shall be entitled to
receive and keep, all amounts awarded or to be awarded as the result of the
taking of such Properties; it being understood and agreed that the Contributed
Equity Value or the Cash Portion of Sales Price of the Property or Properties
to be transferred to the Company pursuant to this Section 8.01(a), as
applicable, shall not be reduced by the amounts so awarded or anticipated to
be so awarded. Contributor shall not settle or compromise any insurance claims
or legal actions relating thereto without the Company's prior consent.
(b) Substitute Properties In Connection with Casualty and
Condemnation. Notwithstanding anything to the contrary contained herein, in
the event that a Casualty or Condemnation occurs, and such Casualty or
Condemnation would otherwise permit the Company or the other Relevant
Contributees to exercise termination rights in accordance with the provisions
of Section 8.01(a) of this Agreement, such event shall constitute a "CC
Substitution Event".
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Section 9. Additional Covenants of Contributor
9.01. Access. Without limiting the effect of the Company's waiver of a
due diligence period, Contributor covenants that between the date of this
Agreement and each Closing, subject to the limitations set forth in Section
1.04, Contributor shall allow the Company or the Company's agents,
representatives or employees reasonable access to the Properties, the Leases
and other documents required to be delivered under this Agreement upon
reasonable prior notice at reasonable times during normal business hours;
provided, however, that no drilling, test borings or other material
disturbance of any Property may be conducted by the Company for review of
soils, compaction, environmental, structural or other conditions without the
prior written consent of Contributor. Contributor (or its designee) shall have
the right, but not the obligation, to accompany the Company or its Agents
during such access to the Properties. The Company shall exercise reasonable
diligence not to disturb the use or occupancy or the conduct of tenant,
occupant or business at any Property. The Company hereby agrees to indemnify,
defend and hold harmless the Contributor and its Affiliates (and each of their
shareholders, members, officers, directors, employees, affiliates, agents,
successors and permitted assigns) from all loss, cost, expense, claims,
damages or liabilities resulting from any such entry or inspections performed
by the Company or its agents or representatives, including, without
limitation, any mechanic's or materialmen's liens relating to the activities
of such parties; such indemnity shall survive the termination of this
Agreement.
Section 10. Conditions Precedent to Closing
10.01. Conditions Precedent to Company Obligations. Subject to Section
10.03, the Relevant Contributees' obligations to effectuate the Tranche 1
Closing, the Tranche 2 Closing and the Tranche 3 Closing on the applicable
Closing Date are subject to the satisfaction of the following conditions
precedent (collectively, the "Contributor Closing Conditions") on or before
the applicable Closing (unless waived in whole or in part by the Relevant
Contributees in writing):
(a) Delivery of Closing Documents. Contributor shall have delivered
to or for the benefit of the Relevant Contributees, on or before the
applicable Closing Date, all of the documents (including, without limitation,
all Tenant Estoppels, Contributor Estoppels, Landlord Estoppels and Substitute
Landlord Estoppels required under this Agreement), other information and
payments, if any, required of Contributor in connection with such Closing
pursuant to Section 11.
(b) Representations and Warranties. All of Contributor's
representations and warranties made in this Agreement shall be true and
correct in all material respects as of the date hereof and as of the
applicable Closing Date, subject in each case to modification of such
representations and warranties pursuant to Section 5.05 of this Agreement and
as may be otherwise expressly permitted by the terms of this Agreement. In
addition, Contributor shall have performed all of its covenants and other
obligations hereunder in all material respects.
(c) Required Consents. All Required Consents to be obtained or given
pursuant to the terms of any Lease or other material agreement affecting the
relevant Properties in connection with the consummation of the transaction
contemplated by this Agreement in respect of the Tranche 1 Closing, the
Tranche 2 Closing and the Tranche 3 Closing, as applicable, shall have been
obtained or given by Contributor.
(d) Brokerage Obligations. All obligations of Contributor under the
Brokerage Agreements with respect to the current, unexpired term of Leases
existing as of the date hereof relating to the Tranche 1 Properties, the
Tranche 2 Properties or the Tranche 3 Properties in connection with the
Tranche 1 Closing, the Tranche 2 Closing or the Tranche 3 Closing,
respectively, shall have been
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paid or credited with respect to such Closing for the account of the Company
against the applicable Cash Portion of the Sales Price, except for any
obligations and commissions becoming due and payable following the date of
this Agreement and (x) resulting from the exercise of renewal or expansion
options by tenants or (y) arising in connection with any new leases signed
after the date hereof in accordance with the terms of this Agreement.
(e) Other Material Conditions Precedent. Contributor shall have
satisfied or caused to be satisfied all other conditions precedent and
covenants with respect to the applicable Closing set forth in this Agreement
in all material respects or any such unsatisfied condition or covenant shall
have been waived in writing by the Relevant Contributees.
(f) Owner's Title Policies and Lender Policies. The Title Company
shall be prepared to issue the Title Policies and and lender title insurance
policies with respect to the Permitted Debt, including, without limitation,
all endorsements (including, without limitation, non-imputation endorsements)
and other affirmative coverage required by any lender or reasonably required
by the Company for all of the Tranche 1 Properties, the Tranche 2 Properties
or the Tranche 3 Properties, as applicable, in the name of the Relevant
Contributees, and any lender of the Company, subject only to the Permitted
Exceptions, in each case, subject to the terms and conditions set forth in
this Agreement.
(g) Termination of Management Contracts. All management contracts
affecting the Properties shall have been terminated, effective as of the
Closing, without liability to the Company.
(h) Closing of Relevant Underwriting Transactions. The transactions
under the Underwriting Agreement applicable to such Closing shall have closed.
(i) Listing of Australian Trust. All conditions and requirements for
the listing of Australian Trust on the Australian Stock Exchange and quotation
of its securities have been satisfied (other than administrative requirements
and acquisition of the Properties).
(j) Permitted Debt Documents. All documents and other instruments
and certificates (executed and acknowledged, where appropriate) required of
Contributor to comply with all the requirements of the Permitted Debt Holders
in order to obtain the Permitted Debt Consents.
(k) Identified Debt. Due authorization, execution and delivery of
the relevant Identified Debt documents by all parties involved other than the
Relevant Contributees.
(l) Assignment of Environmental Insurance Policy. Contributor shall
have assigned, indorsed or otherwise transferred over to the Relevant
Contributee the benefits of the Environmental Insurance Policy.
10.02. Conditions Precedent to Contributor Obligations. The Contributor's
obligations to effectuate the Tranche 1 Closing, the Tranche 2 Closing and the
Tranche 3 Closing on the applicable Closing Date are subject to the
satisfaction of the following conditions precedent on or before the applicable
Closing (unless waived in whole or in part by the Contributor in writing):
(a) Delivery of Closing Documents and Payments. The Company shall
have delivered to or for the benefit of the Contributor, on or before the
applicable Closing Date, all of the documents and payments, if any, required
of the Company in connection with such Closing pursuant to Section 12.
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(b) Conditions Precedent. The Company shall have satisfied or caused
to be satisfied all other conditions precedent and covenants with respect to
the applicable Closing Date set forth in this Agreement or any such
unsatisfied condition or covenant shall have been waived by Contributor.
(c) Representations and Warranties. All of the Company's and the
REIT's representations and warranties made in this Agreement shall be true and
correct in all material respects as of the date hereof and as of such Closing
Date. Moreover, the Company and the REIT shall have performed all of its
covenants and other obligations hereunder in all material respects.
(d) Intentionally Omitted.
(e) Permitted Debt Documents. To the extent the Permitted Debt
Consents are obtained, the Relevant Contributees and the REIT shall execute
and deliver instruments assuming the Permitted Debt and the Ground Leases for
the Tranche 1 Properties, including executing any replacement guarantees,
environmental indemnities, reserve agreements and any other loan documents
substantially equivalent to any of the existing and unexpired Continuing Loan
Documents reasonably requested by such Permitted Debt Holder as a condition to
releasing Contributor and its Affiliates from any liability thereunder in a
form and substance reasonably satisfactory to the applicable lender, including
the execution by the Company of a guaranty in favor of such Permitted Debt
Holder.
(f) Listing of Australian Trust. All conditions and requirements for
the listing of Australian Trust on the Australian Stock Exchange and quotation
of its securities have been satisfied (other than administrative requirements
and acquisition of the Properties).
(g) Closing of Relevant Underwriting Transactions. The transactions
under the Underwriting Agreement applicable to such Closing shall have closed.
(h) Unidentified Debt. The Company has entered into the Unidentified
Debt.
10.03. Effect of Contributor's Failure to Meet Conditions.
(a) If Contributor shall fail to satisfy any of the Contributor
Closing Conditions applicable to the Tranche 1 Closing, the Tranche 2 Closing
or the Tranche 3 Closing, as applicable, as of the applicable Closing Date,
then without limiting any other right or remedy to which the Relevant
Contributees may be entitled, the Company shall be entitled, subject to the
rights granted to Contributor described in the following sentence, to (i)
terminate this Agreement in its entirety, subject to the Surviving
Obligations, provided that the Relevant Contributees shall not have the right
to terminate this Agreement pursuant to this clause (i) until the Relevant
Contributees shall have terminated this Agreement pursuant to the following
clause (ii) with respect to one or more Properties, the individual or
aggregate value of which (based conclusively on the Total Consideration
allocated to such Property or Properties as set forth on the relevant
schedules), is greater than or equal to fifteen percent (15%) of the Total
Consideration of the Properties to be contributed (the "Condition Failure
Threshold"), (ii) terminate this Agreement with respect to the affected
Property (each such affected Property as to which this Agreement is
terminated, a "Failed Closing Condition Property") only (in which event (x)
this Agreement shall, without further action of the parties, be deemed to have
been automatically and ipso facto amended so as to eliminate such Failed
Closing Condition Property, (y) the applicable Tranche 1 Consideration,
Tranche 2 Consideration or Tranche 3 Consideration shall be reduced by the
portion thereof allocated to such Property, and the Cap shall be
proportionately reduced, and (z) this Agreement shall otherwise remain in full
force and effect). The foregoing rights granted to the Relevant Contributees
shall be subject to (a) Contributor's right, exercised by written notice on or
before the applicable Closing Date, to
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extend such Closing Date (and any scheduled Closing Dates to follow such
Closing Date, on a day for day basis) by up to thirty (30) days in order to
permit Contributor, using commercially reasonable efforts, to satisfy such
unsatisfied closing conditions, and (b) Contributor's right to terminate this
Agreement in its entirety from and after such time as the Condition Failure
Threshold is reached; provided, however, that Contributor shall be deemed to
have waived any of the foregoing rights that are not exercised in accordance
with the foregoing on or before the Closing Date (as same may have been
extended in accordance with the foregoing or any other provision of this
Agreement), subject to reinstatement in connection with any subsequent
Closings at which the Condition Failure Threhold is met or exceeded. Each
Failed Closing Condition Property not replaced with a Substitute Property
shall become an "Option Property" under the Option Agreement, and shall be
subject to the terms and conditions of the Option Agreement.
(b) Substitute Properties In Lieu of Closing Condition Failure.
Notwithstanding anything to the contrary contained herein, in the event that
any closing condition that Contributor intended or is otherwise obligated to
fulfill under this Agreement has not been fulfilled as of the applicable
Closing Date with respect to one or more Properties in accordance with the
terms and conditions of this Agreement, such event shall constitute a "Closing
Condition Substitution Event".
Section 11. Contributor's Closing Deliveries
11.01. Contributor Closing Deliveries. On the Tranche 1 Closing Date, the
Tranche 2 Closing Date and the Tranche 3 Closing Date, as applicable,
Contributor shall deliver (to the extent not already delivered) the following
to the Company:
(a) Leases, Ground Leases, Similar Documents. Originals of all
Leases, Ground Leases, and other similar documents relating to the Properties
and in effect as of such Closing Date, to the extent in Contributor's
possession or subject to its control; provided, however, that Contributor
shall retain all the foregoing documents during the term of and in accordance
with the Services Agreement.
(b) Security Schedule. A Schedule of all cash security and similar
deposits, held by or on behalf of Contributor on the Closing Date under the
Leases.
(c) Rent Rolls. Updated Rent Rolls, dated not more than thirty (30)
days prior to the applicable Closing Date and setting forth all arrearages in
rents.
(d) Service Contracts. All original Service Contracts or in lieu of
originals, complete certified copies thereof, which are in effect on the
Closing Date and which are assignable by Contributor; provided, however, that
Contributor shall retain all Service Contracts during the term of the Services
Agreement.
(e) Assignment of Service Contracts, Insurance Policies,
Certificates, Permits and Other Documents. An assignment to the Company and/or
the SPE Entities of all of the interests of Contributor in the Service
Contracts, insurance policies (unless provided for in Section 2.01(f)),
certificates, permits and other documents to be delivered to the Company at
the Closing which are then in effect and are assignable by Contributor.
(f) Transferable Insurance Policies. With respect to all insurance
policies to be transferred from Contributor to the Company (as distinguished
from coverage to be obtained by Contributor or the Company in lieu thereof),
original insurance policies, with the Company added on each as an additional
insured, with respect to which premium are to be apportioned or, if
unobtainable, true
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copies or certificates thereof; provided, however, that Contributor shall
retain possession of all such policies during the terms of the Services
Agreement.
(g) Certificates, Licenses, Permits, Authorizations and Approvals.
All certificates, licenses, permits, authorizations and approvals issued for
or with respect to the Properties by any Governmental Authority having
jurisdiction thereover to the extent same are transferable to the Company;
provided, however, that Contributor shall retain all the foregoing documents
during the term of the Services Agreement.
(h) FIRPTA. A certification of non-foreign status for Owner
Operating Partnership and each Subsidiary, in form required by the Code
Withholding Section, signed under penalty of perjury. Contributor understands
that such certification will be retained by the Company and will be made
available to the Internal Revenue Service on request.
(i) Tenant Notices. An original letter executed by Contributor or by
its agent, advising the tenants of the transfer of the Properties to the
Company and directing that rents and other payments thereafter be sent to the
Company or as the Company may direct.
(j) Authority Documents. Corporate resolutions, certificates of good
standing, incumbency certificates and other evidence of authority within
respect to Contributor, duly executed where applicable.
(k) Possession. Possession of the Properties in the condition
required by this Agreement, subject to the Leases and Ground Leases, and keys
therefor; provided, however, that Contributor shall retain all keys during the
term of the Services Agreement.
(l) Landlord Consents. Original Landlord Consents, if any.
(m) Tenant Estoppels; Landlord Estoppels. All original Tenant
Estoppels, and any Contributor Estoppels in lieu thereof, obtained in
accordance with Section 7.05.
(n) Required Consents. All original Required Consents.
(o) Landlord Estoppels. All Landlord Estoppels or any Substitute
Landlord Estoppels in lieu thereof in accordance with Section 7.06.
(p) Deeds. executed and acknowledged deeds conveying to the Company
fee simple title to the Properties (other than those Properties transferred by
an entity sale pursuant to Section 19 of this Agreement) owned by Contributor
in fee simple title, subject to the Permitted Exceptions.
(q) Assignment of Ground Leases. Executed and acknowledged
assignments and assumptions of ground leases (collectively, the "Assignments
of Ground Leases"), assigning and transferring to the Company, as applicable,
all right, title and interest of Contributor in and to, and all post-Closing
obligations of the lessee under, all Ground Leases affecting the Properties
(other than those Properties transferred by an entity sale pursuant to Section
19 of this Agreement).
(r) Assignment of Leases. Executed and acknowledged assignments and
assumptions of leases (collectively the "Assignments of Leases"), assigning
and transferring to the Company, as applicable, all right, title and interest
of Contributor in and to, and all post-Closing
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obligations of the lessor under, all Leases affecting the Properties (other
than those Properties transferred by an entity sale pursuant to Section 19 of
this Agreement).
(s) Bills of Sale. Executed bills of sale transferring to the
Company, as applicable, all personal property owned by Contributor and located
at or attached to the Properties (other than those Properties transferred by
an entity sale pursuant to Section 19 of this Agreement).
(t) Required Forms. Transfer tax returns, certificates and/or any
other document or instrument required by any federal, state or local
government or municipality to transfer or convey the Properties or to record
any deed or assignment of lease, including, without limitation, any forms
relating to environmental matters required to be filed in connection with the
transfer of the Properties located in Connecticut (collectively, the "Required
Forms").
(u) Services Agreement. An executed Services Agreement.
(v) Substitute Property Documentation. Any documentation reasonably
requested by the Company, any lender or the Title Company in connection with a
Substitute Property.
(w) Agreements. Counterparts of (v) the Option Agreement (the
"Option Agreement") in the form attached hereto as Exhibit N, (w) this
Agreement, (x) the LLC Agreement, (y) the Portfolio Services Agreements, to
the extent applicable to the Tranche 1 Closing, duly authorized, executed and
delivered by all of the parties thereto, and (z) the Tax Protection Agreement,
duly authorized, executed and delivered by all of the parties thereto. The
foregoing, collectively, the "Transaction Agreements".
(x) Excluded Property License Agreements. Counterparts of the
Excluded Property License Agreements, duly authorized, executed and delivered
by the Contributor.
(y) Estoppels. Contributor shall have delivered to or for the
benefit of the Company the requisite Tenant Estoppels, Contributor Estoppels,
Landlord Estoppels, and/or Substitute Ground Lessor Estoppels required under
Sections 7.05 and 7.06.
(z) Other Documents. Any other documents required by this Agreement
to be delivered by Contributor (executed and acknowledged where appropriate)
or otherwise necessary or reasonably required to consummate this transaction
as contemplated herein.
11.02. Delivery at Appropriate Closing; Modified Deliverables Required By
Third Parties; Modification of Deliveries Regarding Entity Transfers.
Notwithstanding the foregoing, to the extent that any of the items to be
delivered to the Company pursuant to Section 11.01 relate to Tranche 2
Properties or Tranche 3 Properties (and do not relate to Tranche 1 Properties)
such items, documents or information shall not be required to be delivered by
the Company at the Tranche 1 Closing and shall instead be delivered by the
Company at the Closing to which such items, documents or information relate.
If any third party with an interest in this transaction, including, without
limitation, any lender or the Title Company, reasonably requires that
additional or updated items, documents or information ((x) which updated or
additional items, documents or information are customary for transactions of
this type and (y) which additional items do not impose any immaterial
additional obligations or liabilities on Contributor) be provided at the
Tranche 2 Closing or the Tranche 3 Closing, then in either case such new,
executed, modified, altered, amended or changed documents or information shall
be delivered to the Company on or prior to the Tranche 2 Closing Date in
connection with the Tranche 2 Properties and on or prior to the Tranche 3
Closing Date in connection with the Tranche 3 Properties. In the event that an
SPE Entity is the Relevant Contributee hereunder, delivery to the Company
shall satisfy the delivery
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requirements hereunder and the deliverables required under Section 11.01 shall
be appropriately modified to reflect the intended contribution to such
Relevant Contributee. The deliveries required under this Section 11 shall be
subject to modification pursuant to Section 20 of this Agreement in connection
with a transfer of entity interests in lieu of an asset transfer.
Section 12. The Company's Closing Deliveries
12.01. Company Deliveries. On the Tranche 1 Closing Date, the Tranche 2
Closing Date and the Tranche 3 Closing Date, as applicable, Company shall
deliver (to the extent not already delivered) the following to the
Contributor:
(a) LLC Agreement. The LLC Agreement executed by the Company and the
REIT.
(b) Assumption of Service Contracts, Insurance Policies,
Certificates, Permits and Other Documents. An executed assumption by the
Company and the SPE Entities, as applicable, of all of the interests of
Contributor in those Service Contracts, insurance policies, certificates,
permits and other documents to be delivered to the Company at the Closing
which are then in effect and are assignable by Contributor.
(c) Portfolio Services Agreement. Executed Portfolio Services
Agreements.
(d) Assignments of Ground Leases and Leases. Executed and
acknowledged Assignments of Ground Leases and the Assignments of Leases.
(e) Documents Required By Permitted Debt Holders. All documents
(including assignment and assumption agreements) and other instruments and
certificates (executed and acknowledged, where appropriate) required of the
Company to comply with all the requirements of the Permitted Debt Holders in
order to assume the Permitted Debt and obtain the Permitted Debt Consents,
together with such other documents described in Section 10.02(e) of this
Agreement;
(f) Required Forms. Executed and acknowledged Required Forms to the
extent a purchaser is required to execute and acknowledge the same.
(g) Interests. The Interests in accordance with this Agreement and
the LLC Agreement.
(h) Applicable Cash Portion of Sales Price. On the Tranche 1 Closing
Date, the Tranche 1 Cash Portion of the Sales Price (plus or minus net
adjustments and prorations pursuant to this Agreement), on the Tranche 2
Closing Date, the Tranche 2 Cash Portion of the Sales Price (plus or minus net
adjustments and prorations pursuant to this Agreement), and on the Tranche 3
Closing Date, the Tranche 3 Cash Portion of the Sales Price (plus or minus net
adjustments and prorations pursuant to this Agreement) payable to Contributor
on the Tranche 3 Closing Date.
(i) Assumption and Indemnity Relating To Ground Leases. An
assumption by the Company or an SPE Entity (as applicable), of, and an
indemnity from the Company in favor of Contributor (and/or its Affiliates or
affiliates, but only to the extent they are signatories under any such
indemnity and/or guaranty), in a form and substance reasonably satisfactory to
Contributor, with respect to, any guarantees and related documents under the
Ground Leases from which Contributor (and/or any of its Affiliates and such
other affiliates) is not released from liability from and after the Closing
Date, for any Losses arising on or after the applicable Closing Date.
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(j) Intentionally Omitted.
(k) PHJW Opinion. An opinion from Paul, Hastings, Janofsky & Walker
LLP, in the form attached hereto as Exhibit I.
(l) Agreements. Counterparts of the Transaction Agreements (as
defined in Section 11.01 of this Agreement), duly authorized, executed and
delivered by all of the parties thereto except the Relevant Contributees.
(m) Debt Releases. Executed original Debt Release with respect to
each applicable Permitted Debt Holder.
(n) Excluded Property License Agreements. Counterparts of the
Excluded Property License Agreements, duly authorized, executed and delivered
by the Relevant Contributees.
(o) Other Documents. Any other documents required by this Agreement
to be delivered by the Company (executed and acknowledged, where appropriate)
or otherwise necessary or reasonably required to consummate this transaction
as contemplated herein.
In the event that an SPE Entity is the Relevant Contributee hereunder,
delivery to the Company shall satisfy the delivery requirements hereunder and
the deliverables required under Section 12.01 shall be appropriately modified
to reflect the intended contribution to such Relevant Contributee. The
deliveries required under this Section 12 shall be subject to modification
pursuant to Section 20 of this Agreement in connection with a transfer of
entity interests in lieu of an asset transfer.
Section 13. Apportionments; Closing Costs
13.01. General Apportionments. The following apportionments shall be made
between the parties at the appropriate Closing as of 11:59 p.m. on the day
prior to the applicable Closing Date:
(a) rent payments (including prepaid rents) and Additional Rent
actually received by Contributor under the Leases, excluding, however, any
"advance rent" paid in advance by tenants under such Leases in respect of the
last month of the term of such Leases (such advance rent, the "Advance Rent").
(b) to the extent not paid directly by tenants under the Leases,
water charges, sewer rents, other utility charges and vault charges, if any,
on the basis of the fiscal period for which assessed, except that if there is
a water meter at the Properties, apportionment at the Closing shall be based
on the last available reading, subject to adjustment after the Closing when
the next reading is available.
(c) value of fuel stored at the Properties at the price then charged
by Contributor's supplier, including any taxes.
(d) charges under transferable Service Contracts and other
transferable agreements pertaining solely to the Properties or permitted
renewals or replacements thereof.
(e) permitted administrative charges, if any, on tenants' security
deposits.
(f) insurance premiums and transfer premiums on transferable
insurance policies or permitted renewals thereof.
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(g) insurance premiums on insurance policies that are not
transferred to the Company but under which coverage is provided to the Company
from and after the Closing.
(h) rent under all Ground Leases.
(i) to the extent not paid directly by tenants to taxing authorities
pursuant to the Leases, real estate taxes and personal property taxes for the
current fiscal year.
(j) outstanding leasing commissions, tenant improvement obligations,
free rent and other concessions of the landlord under any new or renewal
leases entered into after the date hereof pursuant to Section 7.01 (such
apportionment to be made based on the fixed term of such new or renewal
lease).
(k) all interest accrued on the Permitted Debt, but not paid as of
the applicable Closing Date.
(l) Such other items customarily apportioned in real estate closings
of commercial properties in the New York tri-state area.
13.02. Adjustment of Taxes. The adjustment of real estate and personal
property taxes shall be made on the basis of presently available evidence of
such taxes, subject to adjustment by payment from Contributor to the Company,
or the Company to Contributor, whichever is applicable, after the applicable
Closing due to any change in assessment, applicable rate or other reason.
Notwithstanding the foregoing, all or any portion of any special assessments,
that are a lien as of such Closing and that are not otherwise recoverable from
tenants under the Leases shall be paid by Contributor. This Section 13.02
shall survive each Closing and/or sooner termination of this Agreement.
13.03. Credits. The following adjustments to the Cash Portion of the
Sales Price shall be made between the parties at each Closing:
(a) To the extent not assigned or otherwise transferred to the
Relevant Contributees, the Company and the SPE Entities, as applicable, shall
be credited and Contributor charged with security deposits (together with any
interest accrued thereon) or advance rentals made by tenants under the Leases,
the Ground Leases and any additional Leases entered into by Contributor
pursuant to Section 7.01.
(b) To the extent not assigned or otherwise transferred to the
Relevant Contributees, Contributor shall be credited and the Company and the
SPE Entities, as applicable, charged with deposits under any Service Contracts
assigned to the Company at the Closing, and any other transferable deposits to
be transferred in connection with the transactions contemplated hereunder.
(c) The Company and the SPE Entities shall be credited, and
Contributor charged with, all unpaid leasing commissions and tenant
improvement obligations, to the extent applicable to Leases in effect as of
the date hereof (but not including any commissions that may result from the
exercise after the Closing of renewal or expansion options by tenants).
(d) The Contributor shall be credited and the Company and the SPE
Entities, as applicable, charged with (i) fees, charges and reserves under
applicable Permitted Debt and (ii) escrow deposits maintained under applicable
Permitted Debt (plus accrued interest thereon).
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(e) The Contributor shall be credited, and the Company and the SPE
Entities, as applicable, charged with, amounts paid or payable (including any
bonds or security deposits) under telephone and telex contracts and contracts
for the supply of heat, steam, electric power, gas, lighting and any other
utility service, with Contributor receiving a credit for all deposits, if any,
made by Contributor as security under any such public service contract(s) if
the same is transferable and provided such deposit remains on deposit for the
benefit of the Company. (In addition, the parties agree to work together in
good faith to determine, before the expiration of the applicable Closing Date,
the manner in which other bonds and security deposits with respect to the
Properties will be handled from and after the applicable Closing. Without
limiting the foregoing, the parties will use good faith efforts to agree as to
(i) whether the Company (or the applicable SPE Entity) should substitute its
own bonds and/or security deposits for those previously posted by Contributor,
and (ii) which party shall have responsibility for the cost of any such bond
and their respective periods of responsibility therefor.
(f) As of the applicable Closing Date with respect to the 225 High
Ridge Property, the Relevant Contributee shall be credited, and Contributor
charged with, an amount equal to Eight Hundred Seventy Five Thousand and
00/100 Dollars ($875,000.00) (the "Rent Credit"), payable in respect of the
free rent or reduced rent concession period (the "Free Rent Period") described
in that certain Lease dated May 11, 2005 by and between 225 High Ridge
Venture, as landlord, and Synapse Group, Inc., as tenant, commencing on May 1,
2007 for certain space in the building located at 225 High Ridge Road,
Stamford, Connecticut (as amended, modified, restated and supplemented from
time to time hereafter, the "Synapse Lease"), provided that if, as of the
scheduled commencement date of the Free Rent Period or at any time prior to
the expiration of the Free Rent Period, either (x) the Synpase Lease has been
terminated or is otherwise not in full force and effect or such tenant is not
entitled to some or all of such Free Rent Period or (y) the Synpase Lease
shall be amended, modified or supplemented in any manner that affects the Free
Rent Period, then the Relevant Contributee shall promptly notify Contributor
of such occurrence and shall promptly wire the Rent Credit (which Rent Credit
shall be equitably prorated among the relevant parties, if necessary, to
reflect the occurrence and timing of the events described in the preceding
clauses (x) and (y)) in accordance with any wiring instructions provided by
Contributor in connection with such notice. The Company and such Relevant
Contributee shall be jointly and severally liable with respect to the return
of the Rent Credit in accordance with this Section. This Section shall survive
the Closing or earlier termination of this Agreement.
(g) As of the applicable Closing Date with respect to the 225 High
Ridge Property, the Contributor shall be credited, and the Relevant
Contributee charged with, an amount equal to Fifty Seven Thousand and 00/100
Dollars ($57,000.00), payable in respect of certain cost savings realized or
to be realized by the Relevant Contributee in connection with issuance of a
zoning endorsement in respect of the 225 High Ridge Property.
13.04. Tenant Arrearages. If any tenant is in arrears in the payment of
rent or Additional Rent on the Closing Date for which the Property affected by
such tenant is being contributed or sold, rents received from such tenant
after such Closing shall be applied in the following order of priority:
(a) first to the month in which such Closing occurred;
(b) second to the month prior to the Closing;
(c) third to the months after the Closing; and
(d) fourth to any month or months prior to the Closing.
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If rents or Additional Rents or any portion thereof received by Contributor or
the Company after such Closing are payable to the other party by reason of
this allocation, the appropriate sum, less a proportionate share of any
reasonable attorneys' fees, out-of-pocket costs and expenses of collection
thereof, shall be promptly paid to the other party, which obligation shall
survive such Closing.
13.05. Additional Rent. If any tenant is required to pay percentage rent,
escalation charges for real estate taxes, common area maintenance charges,
operating expenses, cost-of-living adjustments or other charges of a similar
nature ("Additional Rent"), and any Additional Rent is collected by the
Company or Contributor on behalf of the Company after the Closing for the
contribution or sale of the Property affected by such tenant which accrued
prior to such Closing and was not otherwise adjusted, then the Company shall
promptly pay Contributor's proportionate share thereof to Contributor, less
any reasonable attorneys' fees, and any other reasonable out-of-pocket costs
and expenses of collection thereof, which obligation shall survive such
Closing.
13.06. Closing Statements. On or before each Closing, Contributor will
prepare and the Company shall review and approve (which approval shall not be
unreasonably withheld or delayed) a final closing statement (the "Final
Closing Statement") setting forth the final determination of all open items
and other apportionments estimated as of each applicable Closing to be
included on the closing statements for each Closing and any re-adjustment
required to "true up" any amounts adjusted under Section 13.01 (including,
without limitation, Additional Rent). The net amount due to Contributor or the
Company, if any, by reason of adjustments to the closing statement as shown in
the Final Closing Statement, shall be paid or credited to the applicable party
at Closing. The adjustments, prorations and determinations agreed to by
Contributor and the Company under this Section 13.06 shall be conclusive and
binding on the parties hereto. Notwithstanding the foregoing, if at any time
within the three hundred sixty five (365) day period following the Tranche 1
Closing, the Tranche 2 Closing or the Tranche 3 Closing, as applicable (each
such period being referred to herein as a "Post-Closing Adjustment Period"),
the amount of any item to be apportioned or credited pursuant to this
Agreement shall prove to be incorrect (whether as a result in an error in
calculation or a lack of complete and accurate information as of the
applicable Closing), the party in whose favor the error was made shall
promptly pay to the other party the sum necessary to correct such error upon
receipt of proof of such error, provided that such proof is delivered to the
party from whom payment is requested within the applicable Post-Closing
Adjustment Period. In order to enable Contributor to determine whether any
such delayed adjustment is necessary, the Relevant Contributee(s) shall
provide to Contributor such information as Contributor shall reasonably
request during the Post-Closing Adjustment Period in order to confirm or
finalize closing adjustments hereunder. The provisions of this Section 13.06
shall survive each Closing and not be merged therein.
13.07. Subject to the other provisions of this Section 13, the following
shall apply to closing costs:
(a) Company Closing Costs. At the applicable Closing, the Company
shall pay (x) all mortgage recording taxes and (y) any other cost or expense
set forth in this Agreement explicitly to be paid by the Company.
(b) Contributor Closing Costs. At the applicable Closing,
Contributor shall pay (i) all recording fees on any document recorded pursuant
to this Agreement to discharge Liens and encumbrances which are not Permitted
Exceptions in accordance with the terms and provisions hereof, (ii) all costs
incurred in obtaining the Required Consents (other than costs described in
Section 13.07(a)(viii)), the Tenant Estoppels, and any Contributor Estoppels
in lieu thereof per Section 7.05, and all other required estoppel certificates
per Section 7.06, and (iii) any other cost or expense set forth in this
Agreement explicitly to be paid by Contributor.
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(c) REIT Closing Costs. At the applicable Closing, the REIT shall
pay (i) all costs for any document to be recorded pursuant to this Agreement
or the LLC Agreement, (ii) the cost of the title examination, the Title
Commitments and the title insurance premiums, including any extended coverage
and endorsements, incurred in connection with the issuance of the Title
Policies and any same costs associated with any lender title insurance
policies, (iii) the cost of any Survey, (iv) any escrow fee which may be
charged by the Title Company, (v) the cost of Phase I environmental site
assessments, other environmental reports and engineering reports, (vi) the
cost of appraisals, (vii) all prepayment premiums and penalties on any loan
encumbering any of the Properties required to be paid by any party hereto at
any Closing, (viii) in each case, all costs charged by the Permitted Debt
Holders, or in connection with the initial financing of the Permitted Debt and
assumption of such Permitted Debt (including, without limitation, their legal
costs, loan assumption fees, bank fees, title insurance endorsements, but
excluding mortgage recording tax), (ix) all costs associated with the transfer
of insurance policies, and (x) subject to Section 20, all of the state and
local transfer taxes, documentary stamp tax or similar tax required to be paid
in the States, counties, cities and/or towns in which the Properties are
located.
(d) Other Costs and Expenses. Except as expressly set forth herein,
each party shall pay its own attorney's fees and all of its other costs and
expenses.
Section 14. Failure of Contributor or the Company to Perform
14.01. Company Default/Breach Prior to Closing. If, prior to any of the
Tranche 1 Closing, the Tranche 2 Closing or the Tranche 3 Closing, the Company
and/or the REIT shall materially default in the performance of any of its
obligations under this Agreement, or shall materially breach any of its
representations, warranties or covenants contained in this Agreement, and such
default or breach shall remain uncured for ten (10) days after the Company
receives written notice thereof from Contributor, then (a) if such act or
omission occurred prior to the Tranche 1 Closing, Contributor, as its sole and
exclusive remedy, may choose, in its absolute discretion, to either (i)
terminate this Agreement and recover from the Company and/or the REIT the
Contributor's actual out of pocket costs incurred in connection with this
Agreement and the transactions contemplated herein or (ii) commence an action
against any such party for specific performance of such obligations hereunder
(subject to all of the terms of this Agreement), and (b) if such act or
omission occurred after the Tranche 1 Closing but before the Tranche 2 Closing
or Tranche 3 Closing, Contributor, may choose, in its absolute discretion, to
either (i) commence an action against any such party for specific performance
of such obligations hereunder (subject to all of the terms of this Agreement),
or (ii) terminate this Agreement and seek liquidated damages hereunder from
the Company and/or the REIT in an amount of five percent (5%) of the Total
Consideration that would otherwise be due with respect to the remaining
terminated Tranches. If Contributor elects to terminate this Agreement
pursuant to this Section 14.01(a), this Agreement shall be of no further force
and effect except for the Surviving Obligations, which shall remain in effect
as provided herein.
14.02. Contributor Default/Breach Prior to Closing. If, prior to any
Closing, the Contributor shall materially default in the performance of any of
its obligations under this Agreement, or shall materially breach any of its
representations, warranties or covenants contained in this Agreement, and such
default shall remain uncured for ten (10) days after the Contributor receives
written notice thereof from the Company, then the Relevant Contributees may
choose, in their sole discretion, to either (i) commence an action against any
such party for specific performance of such obligations hereunder (subject to
all of the terms of this Agreement), or (ii) terminate this Agreement and
recover from the Contributor the Relevant Contributees' actual, out of pocket
costs incurred in connection with this Agreement and the transactions
contemplated herein. If the Relevant Contributees elect to terminate this
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Agreement pursuant to this Section 14.01(a), this Agreement shall be of no
further force and effect except for the Surviving Obligations, which shall
remain in effect as provided herein.
14.03. Termination of Agreement Regarding Aggregation of Title, Survey,
Closing Condition, Condemnation and Casualty Events. Notwithstanding anything
to the contrary herein, if at any time, or from time to time, the sum of the
Total Consideration allocated to the Affected Properties in connection with
the aggregate of the Defect Substitution Events, Closing Condition
Substitution Events and CC Substitution Events affecting the Affected
Properties outstanding at such time exceeds fifteen percent (15%) of the Total
Consideration (with the Total Consideration determined as of the date
hereof)(the "TSSC Threshold"), and at such time the substitution procedures of
Section 2.01(f) have not been invoked with respect to some or all of the
Affected Properties, then both the Contributor and the Relevant Contributees
shall have the continuing right to terminate this Agreement by written notice
to the other as of the date of such notice, provided, however, that such
terminating party shall not have the right to terminate this Agreement
pursuant to this Section 14.03 until the expiration of any applicable notice
and cure and expiration of any rights to extend the applicable Closing granted
with respect to the non-terminating party. For purposes of clarity, the
parties acknowledge and agree that substitution of Substitute Property for
Affected Property (and the pending substitution of Substitute Property for
Affected Property, provided the substitution procedures were instituted in a
timely manner and are being diligently pursued in accordance with the terms
and conditions of this Agreement) in accordance with this Agreement shall not
count against the TSSC Threshold with respect to the portion of Total
Consideration applicable to such Affected Property.
Section 15. Broker
15.01. Broker Representation and Warranty; Indemnification. Contributor
and the Company mutually represent and warrant to each other that neither
Contributor nor the Company knows of, or has dealt with, any broker, finder,
salesperson or similar agent who has claimed or may have the right to claim a
commission in connection with this transaction. Contributor and the Company
shall, subject to the Cap, indemnify and defend each other against any costs,
claims or expenses, including reasonable attorneys' fees, arising out of the
breach on their respective parts of the representations and warranties or
agreements contained in this Section 15.01. The representations and
obligations under this Section 15.01 shall survive the Closing or, if the
Closing does not occur, the termination of this Agreement.
Section 16. Notices
16.01. Method of Notification and Delivery. Any notices, demands,
consents, approvals and other communications ("Notice") provided for in this
Agreement or given in connection with this Agreement shall be given in writing
by (a) personal delivery, (b) reputable overnight delivery service with proof
of delivery, (c) United States Mail, postage prepaid, registered or certified
mail, return receipt requested, deposited in a United States post office or a
depository for the receipt of mail regularly maintained by the post office, or
(d) legible facsimile transmission sent to the intended addressee at the
address set forth below, or to such other address or to the attention of such
other person as the addressee shall have designated by giving at least ten
(10) days written notice sent in accordance herewith, and Notice shall be
deemed to have been given by (i) personal delivery, when received as evidenced
by an affidavit of the person making such delivery, (ii) in the case of
expedited delivery service, next Business day following the date sent and
(iii) mail, then received by the addressee on the date received as evidenced
by a return receipt. When received in the case of facsimile transmission, as
of the date of the facsimile transmission provided that an original of such
facsimile is also sent to the intended addressee by means described in clauses
(a) or (b) above. The inability to make delivery because of change of address
of which notice was given or by reason of rejection or refusal to accept
delivery of any Notice shall be
-41-
deemed to be receipt of the Notice as of the date of such inability to deliver
or rejection or refusal to accept. Unless changed in accordance with the
preceding sentence, the addresses for notices given pursuant to this Agreement
shall be as follows:
If to Contributor:
c/o Reckson Associates Realty Corp.
225 Broadhollow Road
Suite 212W
Melville, New York 11747
Attn: General Counsel
Fax: 631-622-8994
with a copy to:
Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, NY 10019
Attn: Stephen G. Gellman
Fax: 212-403-2246
Telephone: 212-403-1246
Email: SGGellman@wlrk.com
If to the Company:
c/o Reckson Associates Realty Corp.
225 Broadhollow Road
Suite 212W
Melville, New York 11747
Attn: Francis Sheehan, Vice President, Legal-Corporate
Fax: 631-622-8994
Telephone: 631-622-6777
Email: FSheehan@Reckson.com
with a copy to:
Paul, Hastings, Janofsky & Walker LLP
75 East 55th Street
New York, New York 10022
Attn: Robert J. Wertheimer, Esq.
Fax: 212-318-6936
Telephone: 212-318-6550
Email: Robertwertheimer@paulhastings.com
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Section 17. Miscellaneous Provisions
17.01. Assignment or Transfer. Subject to Section 18.01 of this
Agreement, no party hereto shall assign this Agreement or its rights hereunder
without the prior written consent of the other parties hereto. Notwithstanding
anything herein to the contrary, the Company shall have the right to instruct
Contributor to convey title to any of the Properties to any wholly-owned
subsidiary of the Company designated in writing by the Company at least five
(5) Business Days prior to the applicable Closing, and (ii) Contributor may,
without the Company and/or the REIT's consent, assign all or any part of its
rights hereunder to an Affiliate thereof.
17.02. Integration Clause. This Agreement embodies and constitutes the
entire understanding between the parties with respect to the contribution and
sale of the Properties to the Company, and all prior agreements,
understandings, representations and statements, oral or written, are merged
into this Agreement.
17.03. Amendments. Neither this Agreement nor any provision hereof may be
waived, modified, amended, discharged or terminated except by an instrument
signed by both parties hereto, and then only to the extent set forth in such
instrument.
17.04. Governing Law. This Agreement shall be governed by, and construed
in accordance with, the law of the State of New York without regard to its
principles of conflicts of law.
17.05. Captions. The captions in this Agreement are inserted for
convenience of reference only and in no way define, describe or limit the
scope or intent of this Agreement or any of the provisions hereof. Unless
otherwise specified, all references to Sections, sections or provisions in
this Agreement refer to such Sections, Section or provisions as set forth
herein.
17.06. Successors and Assigns. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective
successors and permitted assigns.
17.07. Masculine and Feminine Terms. As used in this Agreement, the
masculine shall include the feminine and neuter, the singular shall include
the plural and the plural shall include the singular, as the context may
require.
17.08. Schedules and Riders. If the provisions of any Schedule or rider
to this Agreement are inconsistent with the provisions of this Agreement, the
provisions of such Schedule or rider shall prevail.
17.09. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall constitute an original and all of which,
when taken together, shall constitute a single instrument.
17.10. No Recordation. This Agreement shall not be recorded.
17.11. No Third Party Beneficiaries. This Agreement is for the sole
benefit of the parties hereto and their respective successors and permitted
assigns, and no other person or entity shall be entitled to rely upon or
receive any benefit from this Agreement or any term hereof.
17.12. No Offer. The submission of this Agreement for examination does
not constitute an offer by or to either party. This Agreement shall be
effective and binding only after due execution and delivery by the parties
hereto.
-43-
17.13. Jurisdiction; Service of Process. The parties hereto each hereby
irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement, or for recognition and enforcement of
any judgment in respect hereof, to the non-exclusive general jurisdiction of
the courts of the State of New York, the federal courts of the United States
of America for the Southern District of New York, and appellate courts from
any thereof;
(b) consents that any such action or proceeding may be brought in
such courts and, to the extent permitted by law, waives any objection that it
may now or hereafter have to the venue of any such action or proceeding in any
such court or that such action or proceeding brought in an inconvenient court
and agrees not to plead or claim the same;
(c) agrees that service of process in any such action or proceeding
may be effected by mailing a copy thereof by registered or certified mail (or
any substantially similar form of mail), postage prepaid, to its address set
forth hereunder; and
(d) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit the
right to sue in any other jurisdiction in the continental United States.
17.14. Further Assurances; Cooperation Regarding Consents. Subject to the
terms and conditions herein provided, each of the parties hereto shall execute
and deliver such documents as the other party shall reasonably request in
order to consummate and make effective the transactins contemplated herein;
provided, however, that the execution and delivery of such documents by such
party shall not result in any additional liability or cost to such party. Each
of the parties shall use commercially reasonable efforts to cooperate in order
to obtain any Required Consents.
Section 18. Certain Tax Matters
18.01. Like-Kind Exchanges. The Company and Contributor acknowledge and
agree that Contributor may elect no later than five (5) days prior to any
Closing Date, to execute and assign to an exchange facilitator, qualified
intermediary, exchange accommodation titleholder or similar entity its
interest in, a separate agreement of sale with respect to any of the Tranche 2
Properties or the Tranche 3 Properties specified by Contributor (the "Excluded
Properties") to facilitate a like-kind exchange of the Excluded Properties in
a transaction or transactions which are intended to qualify for treatment as a
tax-deferred like-kind exchange pursuant to the provisions of Section 1031 of
the Internal Revenue Code (a "1031 Exchange"). Each Excluded Property shall no
longer be subject to the provisions of this Agreement, and the Tranche 2 or
Tranche 3 Consideration and the Tranche 2 or Tranche 3 Cash Portion of the
Sales Price shall be reduced by the Contributed Equity Value of each Excluded
Property. Subject to Section 19, Contributor's election to proceed with a 1031
Exchange of the Excluded Properties may include transfers of equity interests
in entities, the merger and/or consolidation of entities and/or the creation
of other entities such as single member limited liability companies. If
Contributor so elects, the Company shall cooperate (at no expense or liability
to it) in effectuating the 1031 Exchange of the Excluded Properties and in
implementing any such assignment and/or execution of any documentation,
provided that (i) Contributor shall indemnify the Company for all direct costs
and expenses incurred by the Company in connection with an intended or
effectuated 1031 Exchange of an Excluded Property, (ii) the Company shall not
be obligated to take title to any other property, nor shall this Section 18.01
affect in any manner Contributor's obligations or the Company's rights and
benefits under this Agreement (except to the extent that each Excluded
Property shall no longer be subject to the provisions of this Agreement), and
(iii) it is expressly understood that the consummation by Contributor or the
ability by the
-44-
electing party to consummate its intended 1031 Exchange is not a condition
precedent to Contributor's obligation to consummate either the Tranche 2
Closing or the Tranche 3 Closing. The Cap shall be proportionately reduced
upon the occurrence of the transactions contemplated in this Section 18.01.
18.02 Reimbursement of Preformation Expenditures. The Contributor and the
Relevant Contributee(s) hereby agree that, for purposes Section 707(a)(2)(B)
of the Code and the Treasury Regulations thereunder (relating to "disguised
sales"), the money or other consideration received by the Contributor under
this Agreement will be treated as a reimbursement of preformation expenditures
within the meaning of Treasury Regulations Section 1.707-4(d) to the maximum
extent possible
Section 19. Entity Transfers.
19.01. Transfer of Entity Interests in Lieu of Asset Sale. For the
purposes hereof, the term "Contributed Entity" shall mean any entity wholly
owned (directly or indirectly) by the Contributor and now or hereafter owning
one or more of the Properties to be acquired pursuant to this Agreement. If
the Contributor reasonably determines, prior to any or all of the applicable
Closings, that a transfer of all of Contributor's interests in and to the
applicable Contributed Entity to the Company or the SPE Entities (each such
sequence of transactions, or any portion thereof, an "Entity Transfer") in
lieu of an asset sale or contribution of such Properties as otherwise provided
under this Agreement, would result in a savings in costs, expenses or other
liabilities to be incurred by Contributor hereunder or in connection herewith,
then the Contributor shall, at least ten (10) Business Days before the
applicable Closing, notify the Relevant Contributee(s) of Contributor's desire
to effectuate such Entity Transfer and the Relevant Contributee(s) shall,
within five (5) Business Days of such notice, notify Contributor of the
Relevant Contributee(s)' approval or disapproval of such request for an Entity
Transfer; provided, however, that such approval shall not be unreasonably
withheld or conditioned if the cooperation required of the Relevant
Contributee(s) to effectuate such Entity Transfer shall not result in any
unreimbursed increased cost or expense (other than the expense for additional
Searches) or any materially increased obligations or liabilities of the
Company (other than those customarily arising in connection with the transfer
of interests in an entity owning similar property or properties in lieu of
transfers of the underlying property or properties). Failure of the Relevant
Contributee(s) to respond within the aforementioned five (5) Business Day
period shall be deemed approval of such Entity Transfer. The Relevant
Contributee(s) shall reasonably cooperate with Contributor to effectuate each
Entity Transfer that is approved or deemed approved by the Relevant
Contributee(s). In connection with each such Entity Transfer, Contributor
shall (i) provide, in writing, as of the applicable Closing Date, such
additional representations and warranties related to such Contributed Entity
(or the interests in such Contributed Entity that are subject to the Entity
Transfer) as may be reasonably requested by the Company and customarily
required in similar transactions, and (ii) provide to the Relevant
Contributee(s) at the applicable Closing (A) subject to the Cap, an indemnity
in favor of the Relevant Contributee for losses related to such Contributed
Entity for matters arising prior to the applicable Closing Date, in form and
substance reasonably satisfactory to the Company (it being acknowledged and
agreed that such indemnification shall be deemed to eliminate the Company's
right to withhold approval of any Entity Transfer on the grounds that matters
covered in such indemnification will result in materially increased
obligations, liabilities, costs or expenses) and (B) any other documentation
reasonably requested by the Company or by any lender of the Company to the
extent customarily required in similar transactions.
Section 20. Certain Provisions Regarding SPE Entities.
20.01. SPE Entities. The Company acknowledges and agrees that it shall
provide Contributor with the organizational and authorization documents
relating to each of the SPE Entities prior to the applicable Closing and that,
as of the applicable Closing Date, such SPE Entities shall assume, and shall
be jointly and severally liable for, all obligations and liabilities of the
Company in respect of the
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Property to be contributed to such SPE Entity, and shall be entitled to all of
the rights and benefits of the Company in respect of such Property as may be
provided under this Agreement. Prior to the applicable Closing, the Company
shall cause the relevant SPE Entity to execute a joinder agreement in form and
substance reasonably satisfactory to Contributor to effectuate the foregoing.
[Signature Pages Immediately Follow]
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CONTRIBUTOR
-----------
For the following Properties:
6800 Jericho Turnpike, Syosset, NY;
6900 Jericho Turnpike, Syosset, NY;
580 White Plains Road, Tarrytown, NY;
710 Bridgeport Avenue, Shelton, CT:
RECKSON OPERATING PARTNERSHIP,
L.P, a Delaware limited partnership
By: RECKSON ASSOCIATES REALTY
CORP., its general partner
By: /s/ Michael Maturo
---------------------------
Name: Michael Maturo
Title: Chief Financial Officer and
Executive Vice President
Each of the following Subsidiaries:
RA 35 Pinelawn Road LLC, a
Delaware limited liability company;
RA 150 Motor Parkway LLC, a
Delaware limited liability company;
RA 660 White Plains Road LLC, a
Delaware limited liability company;
RA 100 Executive Drive LLC, a
Delaware limited liability company;
RA 100 Grasslands Road LLC, a
Delaware limited liability company;
RA 80 Grasslands Road LLC, a
Delaware limited liability company;
RA 200 Executive Drive LLC, a
Delaware limited liability company;
RA 492 River Road LLC, a
Delaware limited liability company;
RA 225 High Ridge LLC, a
Delaware limited liability company;
RA 1660 Walt Whitman Road LLC, a
Delaware limited liability company;
RA 520 Broadhollow Road LLC, a
Delaware limited liability company;
RA 50 Marcus Drive LLC, a
Delaware limited liability company;
RA 300 Executive Drive LLC, a
Delaware limited liability company
By: RECKSON OPERATING PARTNERSHIP,
L.P,, a Delaware limited partnership
By: RECKSON ASSOCIATES REALTY
CORP., its general partner
By: /s/ Michael Maturo
-----------------------------
Name: Michael Maturo
Title: Chief Financial Officer and
Executive Vice President
COMPANY
-------
RECKSON AUSTRALIA OPERATING COMPANY
LLC, a Delaware limited liability company
By: RECKSON AUSTRALIA LPT CORPORATION,
a Maryland corporation
By: /s/ Michael Maturo
-------------------------
Name: Michael Maturo
Title: Executive Vice President
REIT
----
RECKSON AUSTRALIA LPT CORPORATION,
a Maryland corporation
By: /s/ Michael Maturo
-------------------------
Name: Michael Maturo
Title: Executive Vice President
Exhibit 10.3
SALE AGREEMENT
among
RECKSON OPERATING PARTNERSHIP, L.P.,
certain of its
SUBSIDIARIES
listed on the signature pages hereof,
RECKSON AUSTRALIA OPERATING COMPANY LLC
and
RECKSON AUSTRALIA LPT CORPORATION
Dated as of August 12, 2005
TABLE OF CONTENTS
Page
Section 1. Properties to be Sold; Responsible Entity Termination; Schedules...............................2
1.01. Transfer of Properties.........................................................................2
1.02. Additional Components of Properties; Excluded Property.........................................3
1.03. Review Materials...............................................................................3
1.04. Due Diligence..................................................................................3
1.05. Requests for Estoppels and Consents............................................................4
1.06. Termination; Surviving Obligations.............................................................4
1.07. Intentionally Omitted..........................................................................4
1.08. Responsible Entity Termination Trigger Event...................................................4
1.09. Revisions to Schedules.........................................................................4
Section 2. Objections to Title............................................................................5
2.01. (a) Title Commitments; Title Policies; Permitted Exceptions....................................5
Section 3. Sale Consideration.............................................................................8
3.01. Consideration..................................................................................8
3.02. Adjustments to Consideration...................................................................8
3.03. Intentionally Omitted..........................................................................9
3.04. Intentionally Omitted..........................................................................9
3.05. Intentionally Omitted..........................................................................9
Section 4. The Closing....................................................................................9
4.01. Closing........................................................................................9
4.02. Intentionally Omitted..........................................................................9
4.03. Intentionally Omitted..........................................................................9
4.04. Intentionally Omitted..........................................................................9
4.05. Intentionally Omitted..........................................................................9
4.06. Dates; Times; Dollars..........................................................................9
Section 5. Representations and Warranties.................................................................9
5.01. Seller Representations and Warranties..........................................................9
5.02. Relevant Purchasers Representations and Warranties............................................13
5.03. REIT Representations and Warranties...........................................................13
5.04. (a) Survival of Seller Representations and Warranties; Modification Thereof...................14
TABLE OF CONTENTS
(continued)
Page
5.05. (a) Indemnification by Seller; Cap; Basket....................................................15
Section 6. Acknowledgments of the Company................................................................17
6.01. No Prior Representations or Warranties........................................................17
6.02. As-Is.........................................................................................17
6.03. Environmental Matters.........................................................................18
Section 7. Seller's Obligations as to the Properties.....................................................18
7.01. Operation of Properties Prior to Closing......................................................18
7.02. Certain Lease/Service Contract Actions........................................................19
7.03. Certain Prohibited Actions....................................................................19
7.04. Maintenance of Insurance......................................................................19
7.05. Required Tenant Estoppels; Seller Estoppel....................................................20
7.06. Landlord Estoppels............................................................................20
7.07. Required Consents.............................................................................20
7.08. Termination of Existing Property Management Agreements........................................20
7.09. Intentionally Omitted.........................................................................20
7.10. Intentionally Omitted.........................................................................20
Section 8. Destruction, Damage or Condemnation...........................................................21
8.01. (a) Condemnation..............................................................................21
Section 9. Additional Covenants of Seller................................................................22
9.01. Access........................................................................................22
Section 10. Conditions Precedent to Closing...............................................................22
10.01. Conditions Precedent to Company Obligations...................................................22
10.02. Conditions Precedent to Seller Obligations....................................................23
10.03. Effect of Seller's Failure to Meet Conditions.................................................24
Section 11. Seller's Closing Deliveries...................................................................25
11.01. Seller Closing Deliveries.....................................................................25
11.02. Delivery Requirements for SPE Entity..........................................................27
Section 12. The Company's Closing Deliveries..............................................................27
12.01. Company Deliveries............................................................................27
Section 13. Apportionments; Closing Costs.................................................................29
-3-
TABLE OF CONTENTS
(continued)
Page
13.01. General Apportionments........................................................................29
13.02. Adjustment of Taxes...........................................................................29
13.03. Credits.......................................................................................30
13.04. Tenant Arrearages.............................................................................30
13.05. Additional Rent...............................................................................31
13.06. Closing Statements............................................................................31
13.07. Closing Costs.................................................................................31
Section 14. Failure of Seller or the Company to Perform...................................................32
14.01. Company Default/Breach Prior to Closing.......................................................32
14.02. Seller Default/Breach Prior to Closing........................................................32
14.03. Termination of Agreement Regarding Aggregation of Title, Survey, Closing Condition,
Condemnation and Casualty Events..............................................................32
Section 15. Broker........................................................................................32
15.01. No Broker.....................................................................................32
Section 16. Notices.......................................................................................33
16.01. Form of Notice................................................................................33
Section 17. Miscellaneous Provisions......................................................................34
17.01. Assignment or Transfer........................................................................34
17.02. Integration Clause............................................................................34
17.03. Amendments....................................................................................34
17.04. Governing Law.................................................................................34
17.05. Captions......................................................................................34
17.06. Successors and Assigns........................................................................35
17.07. Masculine and Feminine Terms..................................................................35
17.08. Schedules and Riders..........................................................................35
17.09. Counterparts..................................................................................35
17.10. No Recordation................................................................................35
17.11. No Third Party Beneficiaries..................................................................35
17.12. No Offer......................................................................................35
17.13. Jurisdiction; Service of Process..............................................................35
-4-
TABLE OF CONTENTS
(continued)
Page
17.14. Further Assurances; Cooperation Regarding Consents............................................35
Section 18. Certain Tax Matters...........................................................................36
18.01. Like-Kind Exchanges...........................................................................36
Section 19. Entity Transfers..............................................................................36
19.01. Entity Transfer Provisions....................................................................36
Section 20. Certain Provisions Regarding SPE Entities.....................................................37
20.01. SPE Entities..................................................................................37
Exhibits
- --------
Exhibit A. Subsidiaries
Exhibit B. Properties
Exhibit C. Form of Limited Liability Company Agreement
Exhibit D-1. Form of Property Management and Leasing Agreement
Exhibit D-2. Form of Construction Service Agreements
Exhibit D-3. Form of Services Agreement
Exhibit D-4. Form of AM Agreement
Exhibit E. Form of Tenant Estoppel
Exhibit F. Form of Landlord Estoppel
Exhibit G. Intentionally Omitted
Exhibit H. Intentionally Omitted
Exhibit I. Form of Paul, Hastings, Janofsky & Walker LLP Opinion
Exhibit J. Intentionally Omitted
Exhibit K. Form of License Agreement
Exhibit L. Intentionally Omitted
Exhibit M. Intentionally Omitted
Exhibit N. Form of Option Agreement
Schedules
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Schedule 1.01(c) Real Properties
Schedule 1.02 Excluded Personal Property
Schedule 3.01(c)(i) Consideration and Sales Price
Schedule 5.01(e)-1 Rent Rolls
Schedule 5.01(e)-2 Tenant Arrearages
Schedule 5.01(f) Leases
-5-
Schedule 5.01(g) Ground Leases
Schedule 5.01(h) Brokerage Agreements
Schedule 5.01(i) Material Service Contracts
Schedule 5.01(j) Capital Improvement Projects
Schedule 5.01(k) Environmental Reports
Schedule 5.01(o) Litigation Schedule
Schedule 5.01(p) Outstanding Agreements with Attorneys or Consultants
Schedule 5.05(a) Special Indemnification Matters
Schedule 7.07 Required Consents
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INDEX OF DEFINED TERMS
Defined Term Section
- ------------ -------
1031 Exchange...........................................................18.01
Additional Rent. .......................................................13.05
Advance Rent.........................................................13.01(a)
Agents...................................................................1.03
Agreement............................................................Preamble
AM Agreement.........................................................Recitals
Assignment of Ground Leases..........................................11.01(q)
Assignment of Leases.................................................11.01(r)
Australian Trust.....................................................Recitals
Basket................................................................5.05(a)
Brokerage Agreements..................................................5.01(h)
Business Days............................................................7.01
Cap...................................................................5.05(a)
Closing..................................................................4.01
Closing Date.............................................................4.01
Closing Deadline.........................................................4.01
Code Withholding Section..............................................5.01(n)
Company..............................................................Preamble
Condition Failure Threshold..........................................10.03(a)
Consideration.........................................................3.01(c)
Cost to Cure .........................................................2.01(d)
CS Agreements........................................................Recitals
Cure Choice Notice....................................................2.01(c)
Defect................................................................2.01(c)
Defect Property.......................................................2.01(c)
Defects Notice........................................................2.01(c)
Defect Threshold......................................................2.01(c)
Defect Threshold Deadline.............................................2.01(c)
Defect Threshold Termination Right....................................2.01(c)
DYNA Models...........................................................2.01(e)
Election to Defend....................................................5.05(d)
Entity Transfer.........................................................19.01
Environmental Reports.................................................5.01(k)
Excluded Properties.....................................................?????
Excluded Personal Property ..............................................1.02
Excluded Property License Agreements.....................................1.02
Failed Closing Condition Property.......................................10.03
Final Closing Statement.................................................13.06
Ground Leases.........................................................5.01(g)
Landlord Estoppel........................................................7.06
Leases................................................................5.01(f)
LLC Agreement........................................................Recitals
Losses................................................................5.05(a)
Major Tenant..........................................................5.01(f)
Manager..............................................................Recitals
Material Service Contracts............................................5.01(i)
Must Removes..........................................................2.01(a)
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Defined Term Section
- ------------ -------
Notice..................................................................16.01
Option Agreement.....................................................11.01(w)
Owner Operating Partnership..........................................Preamble
Permitted Exceptions..................................................2.01(a)
Post-Closing Adjustment Period..........................................13.06
Portfolio Services Agreements........................................Recitals
Property Management Agreements.......................................Recitals
Property Services Agreements.........................................Recitals
Properties...........................................................Recitals
RAML.................................................................Recitals
Real Properties.......................................................1.01(c)
REIT.................................................................Preamble
RE Trigger Event ........................................................1.08
Relevant Purchasers..................................................Recitals
Rent Rolls............................................................5.01(e)
Rep Survival Period...................................................5.04(a)
Required Consents........................................................7.07
Required Forms.......................................................11.01(t)
Responsible Entity....................................................Recital
Review Materials.........................................................1.03
Searches..............................................................2.01(a)
Seller...............................................................Preamble
Seller Closing Conditions...............................................10.01
Seller Estoppel..........................................................7.05
Seller's Knowledge....................................................5.04(a)
Service Contracts.....................................................5.01(i)
Services Agreement...................................................Recitals
Sold Entity.............................................................19.01
Sold Interests...........................................................1.01
SPE Entities.........................................................Recitals
Special Indemnification Matters ......................................5.05(a)
Subsidiaries.........................................................Preamble
Substitute Ground Lessor Estoppel .......................................7.06
Substitute Property...................................................2.01(e)
Survey................................................................2.01(b)
Surveys...............................................................2.01(b)
Surviving Obligations....................................................1.06
Tenant Estoppels.........................................................7.05
Third Party Claim......................................................5.5(d)
Title Cap.............................................................2.01(a)
Title Commitments.....................................................2.01(a)
Title Company.........................................................2.01(a)
Title Policies........................................................2.01(a)
Underwriting Agreement...................................................4.01
Underwriting Deadline....................................................4.01
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SALE AGREEMENT
--------------
This SALE AGREEMENT (this "Agreement") dated as of[August ___, 2005,
among RECKSON OPERATING PARTNERSHIP, L.P., a Delaware limited partnership
("Owner Operating Partnership"), having an address at 225 Broadhollow Road,
Melville, New York 11747, and the various direct and indirect wholly owned or
controlled subsidiaries of Owner Operating Partnership set forth on Exhibit A
annexed hereto and on the signature pages hereof (collectively, the
"Subsidiaries"; the Subsidiaries and Owner Operating Partnership,
collectively, "Seller"), RECKSON AUSTRALIA OPERATING COMPANY LLC, a Delaware
limited liability company, having an address at c/o Reckson Management Group,
Inc., 225 Broadhollow Road, Suite 212W, Melville, New York 11747, Attn:
Francis Sheehan, Fax: 631-622-8994, Telephone: 631-622-6777 (the "Company")
and RECKSON AUSTRALIA LPT CORPORATION, a Maryland corporation (the "REIT"),
having an address at c/o Reckson Management Group, Inc., 225 Broadhollow Road,
Suite 212W, Melville, New York 11747, Attn: Francis Sheehan, Fax:
631-622-8994, Telephone: 631-622-6777. Defined terms used herein may be
located using the Index of Defined Terms immediately preceding this Preamble.
RECITALS:
---------
A. Owner Operating Partnership directly owns, or indirectly owns through
its wholly owned Subsidiaries, fee simple interests or ground leasehold
interests (as lessee) in the Real Properties (as hereinafter defined) set
forth on Exhibit B annexed hereto.
B. The Company is a subsidiary of the REIT, and was formed for the
purpose of acquiring (directly or indirectly) all right, title and interest of
Seller in and to the Real Properties; such acquisition may be effectuated by
the acquisition of all of Owner Operating Partnership's right, title and
interest in some or all of the Subsidiaries in lieu of the acquisition of the
assets of such Subsidiaries, as contemplated by Section 19 hereof.
C. At the Closing, inter alia, Seller shall sell the Properties (as
hereinafter defined) to the Company and/or to certain designees of the Company
(which designees shall be referred to herein as the "SPE Entities", and which
SPE Entities shall be wholly-owned, and to the extent required by any
applicable lenders in respect of such SPE Entities, special purpose,
subsidiaries of the Company, newly formed prior to the Closing), as
applicable, pursuant to the terms of this Agreement and upon the satisfaction
of the conditions to the Closing set forth herein.
D. Seller shall receive cash proceeds pursuant to terms of this Agreement
with respect to the sale of the Properties to the Company and/or the SPE
Entities (the Company and/or the SPE Entities, as the context may require,
shall be referred to herein as the "Relevant Purchasers").
E. The parties intend for the foregoing to be accomplished in a single
closing (referred to herein as a "Closing", as more particularly defined
herein), subject to the terms and conditions set forth herein.
F. At the Closing, Owner Operating Partnership and the REIT shall enter
into that certain Amended and Restated Limited Liability Company Agreement of
the Company annexed hereto as Exhibit C (the "LLC Agreement").
G. At the Closing, (i) Reckson Management Group, Inc., a New York
corporation (which is an Affiliate (as defined in the LLC Agreement) of Owner
Operating Partnership) or certain Affiliates of Reckson Management Group, Inc.
(any of the foregoing, as the context may require, "Manager"), (ii) the
Company, and (iii) each Affiliate of the Company that shall be acquiring a
Property
at such Closing, or, to the extent Sold Interests are acquired in lieu of any
Properties, the Sold Entity (as hereinafter defined), shall enter into a
Property Management and Leasing Agreement, substantially in the form annexed
hereto as Exhibit D-1, (collectively, the "Property Management Agreements").
H. At the Closing, (i) Reckson Construction & Development, LLC, a
Delaware limited liability company, or certain Affiliates of Reckson
Construction & Development, LLC, (ii) the Company, and (iii) each Affiliate of
the Company that shall be acquiring a Property at such Closing, or, to the
extent Sold Interests are acquired in lieu of any Properties, the Sold Entity,
shall enter into a Construction Services Agreement, substantially in the form
annexed hereto as Exhibit D-2 (collectively, the "CS Agreements", together
with the Property Management Agreements, to be referred to as the "Property
Services Agreements").
I. At the Closing, Manager and the Company shall enter into that certain
Services Agreement substantially in the form annexed hereto as Exhibit D-3
(the "Services Agreement").
J. At the Closing, Reckson Australia Asset Manager LLC, a Delaware
limited liability company, and the REIT shall enter into that certain Asset
Management Agreement substantially in the form annexed hereto as Exhibit D-4
(the "AM Agreement", and together with the Property Services Agreements and
the Services Agreement, collectively, the "Portfolio Services Agreements").
K. On or before the Closing, Reckson Australia Management Ltd., a
corporation organized under the laws of New South Wales, Australia ("RAML")
will be the responsible entity (the "Responsible Entity") in respect of
Reckson New York Property Trust, an Australian listed property trust (the
"Australian Trust").
L. At the Closing, Owner Operating Partnership, certain of its
affiliates, the Company and the REIT shall enter into that certain Option
Agreement (as hereinafter defined).
M. At or prior to the Closing, Reckson Australia Management Limited and
Citigroup Global Markets Australia Pty Ltd and UBS AG, Australia Branch shall
enter into that certain Underwriting Agreement (as hereinafter defined).
NOW THEREFORE, in consideration of the terms and conditions contained in
this Agreement, the mutual covenants herein contained and other good and
valuable consideration, the mutual receipt and legal sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
Section 1. Properties to be Sold; Responsible Entity Termination;
Schedules
1.01. Transfer of Properties. At the Closing, Seller shall sell the
relevant Properties or the Sold Interests to the Relevant Purchaser, as
described below:
(a) Intentionally Omitted.
(b) Intentionally Omitted.
(c) Properties. At the Closing, Seller shall sell, assign, transfer
and deliver to the Relevant Purchaser, and the Relevant Purchaser shall
purchase and receive from Seller, upon the terms and conditions set forth in
this Agreement, either or both of (i) fee simple and/or leasehold interests in
and to the Properties set forth on Schedule 1.01(c) annexed hereto (the "Real
Properties"), and all right, title and interest of Seller in and to the
fixtures, equipment and other property attached or appurtenant to the Real
Properties or (ii) Sold Interests in the Sold Entities that own such Real
Properties (the "Sold
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Interests"; it being acknowledged and agreed that references in this Agreement
to the "Properties" shall be deemed references to either or both of the Real
Properties or the Sold Interests, as the context may require; the Real
Properties, together with the Sold Interests, the "Properties"); in exchange
for the Consideration that is allocated among such Properties as described in
Section 3 of this Agreement.
1.02. Additional Components of Properties; Excluded Property. For
purposes of this Agreement, the term "Real Properties" shall also include,
without limitation, all right, title and interest of Seller in and to any
easements, rights of way, strips, gores, privileges, licenses, appurtenants
and other rights, benefits and interests, appurtenant thereto, including,
without limitation, all right, title and interest of Seller in and to any
streets or other public ways adjacent to the Real Properties and any water,
sewer, utility district or mineral rights owned by, or leased to, Seller, all
improvements located on each Real Property and all structures, systems and
utilities utilized by Seller with respect to such Real Properties exclusively
(but excluding any improvements owned by tenants under any Leases at the Real
Properties, except any improvements owned by Seller or to which Seller has
rights under any Ground Lease), all tangible personal property owned by Seller
and located on the land or used in connection with each Real Property and all
of Seller's right, title and interest in and to all Leases, Ground Leases, all
security deposits given under all Leases, the Ground Leases and all Service
Contracts and other agreements to the extent any adjustments are made pursuant
to Section 13.01. Notwithstanding anything to the contrary in this Agreement,
the property described on Schedule 1.02 annexed hereto and made a part hereof
(the "Excluded Personal Property") shall not be included in the Properties
subject to transfer pursuant to this Agreement, nor shall the Excluded
Personal Property be subject to transfer by operation of law or otherwise in
connection with transfer of Sold Interests under this Agreement. The parties
acknowledge and agree that, at the Closing, Seller and the Relevant Purchaser
shall enter into license agreements ("Excluded Property License Agreements")
in the form annexed hereto as Exhibit K and made a part hereof with respect to
certain Excluded Personal Property described on Schedule 1.02.
1.03. Review Materials. Seller has made available to the Company true,
correct and complete copies of the Title Commitments, the Searches, the
Surveys, the Leases, Ground Leases, the Environmental Reports, the Continuing
Loan Documents, any engineering reports and appraisals ordered by Seller for
the Company (together with any other materials reasonably requested by the
Company, collectively, the "Review Materials"). The Review Materials and any
other materials, reports, surveys, books and records examined by or on behalf
of the Company pursuant to this Agreement shall: (i) be held in strict
confidence by the Company, (ii) not be used for any purpose other than the
investigation and evaluation of the Properties by the Company and its lenders,
attorneys, financial advisors, investors, accountants, partners, members,
directors, officers, employees, agents, engineers and consultants involved or
likely to be involved in this transaction (collectively, the "Agents"), and
(iii) not to be disclosed, divulged or otherwise furnished to any other person
or entity prior to the Closing except to the Agents, as otherwise contemplated
herein, or as permitted by Seller, or as required by law, regulation or court
order. If this Agreement is terminated for any reason whatsoever, the Company
shall, at its option, destroy or return to Seller all of the Review Materials
in the possession of the Company and the Agents. The provisions of this
Section shall survive the termination of this Agreement.
1.04. Due Diligence. The Company acknowledges that, prior to the
execution of this Agreement, it has been permitted to make a complete review,
evaluation and inspection of the Real Properties and has completed all due
diligence deemed desirable by the Company with respect to the Real Properties.
To the extent not already delivered, copies of all other environmental,
appraisals, engineering or any other third party reports prepared by or on
behalf of the Company with respect to the Properties shall be provided
promptly to Seller and such reports shall be held subject to the second
sentence of Section 1.03. Subject to Section 9.01, the Company shall have no
further right to inspect the Real Properties or to conduct any testing in
respect thereof unless approved in writing by Seller, such approval not to be
unreasonably withheld, delayed or conditioned. The Company acknowledges that
it has entered
-3-
into this Agreement with the intention of making and relying solely upon its
investigation of the physical, environmental, economic and legal condition of
the Real Properties and that it is not relying upon any representation or
warranty of Seller or any agent, employee, representative or Affiliate of
Seller, other than those specifically set forth herein. The Company further
acknowledges that it has not received from Seller any accounting, tax, legal,
architectural, engineering, environmental property management or other advice
with respect to the transactions contemplated hereby and that, except as
otherwise expressly provided herein, the Company is relying solely upon the
advice of its own accounting, tax, legal, architectural, engineering,
environmental, property management and other advisors.
1.05. Requests for Estoppels and Consents.
(a) Tenant Estoppels; Landlord Estoppels; Consents. Prior to the
Closing Date, with respect to the Properties, Seller shall submit (i) written
requests for Tenant Estoppels to all tenants of the Properties, (ii) written
requests for Landlord Estoppels to all ground lessors under the applicable
Ground Leases and (iii) written requests for consents to the appropriate party
in accordance with Section 7.07.
(b) Intentionally Omitted.
(i) Intentionally Omitted.
(c) Intentionally Omitted.
(d) Intentionally Omitted.
1.06. Termination; Surviving Obligations. In the event that any express
provision of this Agreement gives any party the right to terminate this
Agreement, such party shall notify the other parties in writing of such
termination, and upon delivery of such notice this Agreement shall be
terminated and neither Seller, the Company, nor the REIT shall have any
further liability to the other hereunder, except with respect to the covenants
and indemnities explicitly stated to survive termination of this Agreement,
including, without limitation, those contained in Section 1.03, Section
2.01(e), Section 5.01, Section 6.01, Section 6.03, Section 13.02, Section
13.04, Section 13.06, Section 14, Section 15 and Section 17, which shall be
referred to herein as the "Surviving Obligations".
1.07. Intentionally Omitted.
(a) Intentionally Omitted.
(b) Intentionally Omitted.
1.08. Responsible Entity Termination Trigger Event. Notwithstanding
anything herein to the contrary, in the event that Reckson Australia
Management Ltd. (or any successor to Reckson Australia Management Ltd. that
shall be a controlled Affiliate of Owner Operating Partnership) is terminated
or otherwise removed or retired as the Responsible Entity for any reason (an
"RE Trigger Event"), then Owner Operating Partnership may, at its option and
in its sole discretion, elect to terminate this Agreement in its entirety,
subject to the Surviving Obligations.
1.09. Revisions to Schedules. The parties acknowledge and agree that, as
of the date hereof, certain schedules of this Agreement describing and
allocating the consideration are in a preliminary form or, due to the nature
of such schedules, it is impossible or unduly burdensome to continuously
update such schedules. The parties will use commercially reasonable efforts to
agree upon
-4-
final forms of each schedule prior to the Closing, using good faith efforts to
conform such schedules to such parties' expectations as contemplated in the
relevant DYNA Models, the PDS and other transaction documents (it being
acknowledged and agreed that, to the extent necessary or desirable for the
exercise of for the proper exercise of any right granted to the parties
hereunder, such schedules will be finalized in a timely manner to permit the
relevant party to exercise such right in an informed manner, and the relevant
time periods for exercise of such rights will be extended on a day for day
basis attributable to any delay attributable to the other party, as may be
necessary).
Section 2. Objections to Title
2.01. (a) Title Commitments; Title Policies; Permitted Exceptions. The
Company acknowledges and agrees that it has received copies of ALTA title
insurance commitments (together with any updates and endorsements thereto, the
"Title Commitments") issued by Commonwealth Land Title Insurance Company
and/or First American Title Insurance Company or such other reputable title
insurance companies designated by Seller which is licensed to do business in
the states where the Properties are located (collectively, the "Title
Company") in respect of all of the Properties on or prior to the date hereof.
The title insurance policies to be issued at the Closing by Title Company
pursuant to the Title Commitments shall be standard forms of owner's policies
(ALTA Form 1992 or later), in jurisdictions where such forms of policy are
available, in the collective amount of the Consideration allocated to the
relevant Properties as the Company shall require at the Closing, and shall
contain such endorsements (including non-imputation), affirmative coverages
and reinsurance and/or co-insurance as the Company shall reasonably require
(collectively, the "Title Policies"). Each Title Policy shall insure (in the
policy amount set forth therein) that the Company or applicable Subsidiary
listed in such policy holds fee or leasehold title to such Property, as
applicable, as of the Closing Date, subject only to, with respect to such
Property, (i) the exceptions contained in the applicable Title Commitment as
of the date hereof (except for any "standard" or "general" exceptions, which
shall be removed by satisfactory title affidavit from Seller), (ii) any
matters affecting title created before or after the date hereof by or with the
written consent of the Relevant Purchasers, (iii) any other title or survey
matters which arise after the date hereof that either are not objected to in
writing by the Company pursuant to Section 2.01(c) hereof, or, if objected to
in writing by the Company pursuant to Section 2.01(c) hereof, are those (A)
which Seller has elected in writing not to remove or cure (which shall be a
matter within Seller's sole discretion, excepting solely as to Must Removes
(as defined below), or has been unable to remove or cure prior to the Closing
Date (excepting Must Removes), and, in each case, subject to which the Company
has elected in writing to accept as Permitted Exceptions, (B) over which the
Title Company is willing to insure or provide affirmative insurance (at no
cost or expense to the Relevant Purchasers), or (C) which are the
responsibility of any tenant under the Leases to cure, correct or remove
including, without limitation, Leases executed in accordance with the terms of
Section 7, and (iv) any other matters to which the Relevant Purchasers are
required to accept title to the Properties pursuant to the terms of this
Agreement, (clauses (i) through (iv), collectively, the "Permitted
Exceptions"), and (v) with respect to all Properties, otherwise free and clear
of all standard or general exceptions contained in the Title Commitments which
the Title Company is permitted by applicable law to remove upon delivery of
the Surveys and customary title affidavits from Seller. Seller shall cause the
Title Policies to be issued to the Relevant Purchasers at the Closing. The
Company has ordered, at Company's expense, customary UCC, judgment, lien and
bankruptcy searches against Seller and the Properties (as applicable)
(together with any updates thereto, collectively, the "Searches").
Notwithstanding anything contained herein to the contrary, the following shall
not be deemed "Permitted Exceptions" (collectively, the "Must Removes"): (X)
any monetary liens voluntarily created by Seller including, without
limitation, any mortgage, lien, pledge, encumbrance or exception to title
against such Property (whether such Property consists of Sold Interests or
Real Property) created by the voluntary action of Seller or its Affiliates
against or affecting such Property that can be removed or cured by payment of
a liquidated sum of money and (Y) any judgment, fines penalties or other
involuntary liens affecting such Property if and to the extent that the
aggregate cost of satisfying
-5-
the claims secured by such liens is less than (i) Twenty-Five Thousand
($25,000) Dollars per Property and (ii) the aggregate of Five Hundred Thousand
($500,000) Dollars for all Properties (as applicable, the "Title Cap").
(b) Surveys. The Relevant Purchasers acknowledge and agree that on or
prior to the date hereof they have received copies of updated surveys of each
of the Properties in form and substance satisfactory to the Relevant
Purchasers (the "Surveys", and each, a "Survey"), certified to the Company,
the Relevant Purchasers and the Title Company.
(c) Defects. Subject to Section 2.01(e), with respect to (i) any new
matters raised by the Title Company after the date hereof as an additional
exception in any Title Commitment or (ii) such new matters as may be disclosed
by updates to any Survey or the Searches and, in the case of clauses (i) and
(ii), which (x) have a material adverse effect on the use, utility or value of
the Property or the use, utility or value of the Sold Interests, and (y) are
not otherwise Permitted Exceptions (each a "Defect"), within five (5) Business
Days after the Company receives written notification thereof, the Company
shall give written notification(s) to Seller (each such notification, a
"Defects Notice") of any objections the Company may have to such Defect.
Seller shall elect, by written notice (each such notice, a "Cure Choice
Notice") within seven (7) Business Days after receipt of a Defects Notice (it
being agreed that failure to provide notice of such election within such
period shall be deemed refusal to cure such Defect to the Relevant
Purchasers), to either cure or refuse to cure any such Defect with regard to
any Property. If Seller elects to cure such Defect in accordance with the
foregoing, such Defect shall be deemed a "Must Remove" under this Agreement.
If the Seller does not elect to cure such Defect in accordance with the
foregoing, the Company shall notify Seller within five (5) Business Days (the
expiration date of such five (5) Business Day period, the "Defect Threshold
Deadline") after expiration of such seven (7) day period whether it shall (i)
terminate this Agreement in its entirety, subject to the Surviving
Obligations, provided that the Relevant Purchasers shall not have the right to
terminate this Agreement pursuant to this clause (i) until the Relevant
Purchasers shall have terminated this Agreement pursuant to the following
clause (ii) with respect to one or more Properties, the individual or
aggregate value of which (based conclusively on the Consideration allocated to
such Property or Properties as set forth on the relevant schedules), is
greater than or equal to twenty-five percent (25%) of the Consideration as of
the date hereof (such threshold, the "Defect Threshold"), or (ii) terminate
this Agreement with respect to the affected Property (each such affected
Property as to which this Agreement is terminated, a "Defect Property") only
(in which event (x) this Agreement shall, without further action of the
parties, be deemed to have been automatically and ipso facto amended so as to
eliminate such Property, (y) the Consideration shall be reduced by the portion
thereof allocated to such Property, and the Cap shall be proportionately
reduced (but the Basket shall not be reduced as a result of such elimination),
and (z) this Agreement shall otherwise remain in full force and effect); it
being agreed that failure to provide notice of such election within such
response time period shall be deemed an election to proceed with the
transactions contemplated in this Agreement, subject to the terms and
conditions of this Agreement, without terminating this Agreement with respect
to any such affected Property, provided that the foregoing shall not be
construed as a waiver of any subsequent termination rights that may be
available to the Relevant Purchasers under this Section 2.01(c). If the Defect
Threshold is reached, then Seller shall have the right ("Defect Threshold
Termination Right") to terminate this Agreement in its entirety by written
notice to the Relevant Purchasers on or before the Defect Threshold Deadline;
failure to exercise the Defect Threshold Termination Right in accordance with
the foregoing shall be deemed an election by Seller to proceed with the
transactions contemplated in this Agreement, subject to reinstatement of the
Defect Threshold Termination Right at such time as further Defects
aggregating, together with previously discovered Defects, in excess of the
Defect Threshold may be revealed in accordance with the foregoing. Each Defect
Property not replaced with a Substitute Property shall become an "Option
Property" under the Option Agreement, and shall be subject to the terms and
conditions of the Option Agreement.
-6-
(d) Cure of Defects. Seller shall have the right, but not the obligation,
to cure any such Defect within fifteen (15) Business Days after its receipt of
the Defect Notice, or in the case of any Defect which cannot with due
diligence be cured within such fifteen (15) Business Day period, such later
date by which such Defect can reasonably be cured, provided that Seller
commences to cure such Defect within such fifteen (15) Business Day period and
thereafter continues diligently and in good faith to cure the Defect,
provided, further, that Seller's right to cure any Defect in accordance with
the foregoing provisions is subject to compliance with the provisions of
Section 2.01(c) of this Agreement applicable to Cure Choice Notices. In the
event that Seller elects not to cure any such Defect or is unable to effect
such cure prior to the Closing, the Company shall have the remedies provided
in Section 2.01(c), this Section 2.01(d) and Section 14 hereof.
Notwithstanding anything to the contrary contained in this Agreement, Seller
shall have no obligation to cure any Permitted Exceptions and Defects (other
than the Must Removes) and shall only have the obligation to cure the Must
Removes. If Seller fails to cure any Defects other than the Must Removes, or
if by the expiration of the cure period provided for above, Seller has failed
to cure all Defects (other than the Must Removes), the Company shall
nonetheless be obligated to proceed to close subject to any such Defects. In
such event, at the Company's sole election, (a) the Company shall deduct from
the applicable Consideration with respect to such Property the cost to cure
("Cost to Cure") such Defect as mutually agreed to by the Company and Seller
in their commercially reasonable discretion (it being acknowledged and agreed
that if the Cost to Cure exceeds the Consideration allocated to such Property,
the Relevant Purchasers may allocate such deduction to the Consideration
applicable to any other Properties), or (b) Seller shall place into escrow
with the Title Company, pursuant to an escrow agreement in a form mutually
agreed to by the parties, the cost to cure such Defect as mutually agreed to
by the Company and Seller in their commercially reasonable discretion;
provided, however, that in no event shall the amount of such deduction or such
escrow, together with all amounts paid by Seller to cure Defects (other than
the Must Removes) exceed (i) the portion of the Consideration allocated to
such Property, with respect to any individual Property, or (ii) the Title Cap,
in the aggregate. In no event shall an amount so deducted or escrowed reduce
the amount available under the Title Cap; provided, however, that in the event
that the subject Defect constitutes a Breach of the representations and
warranties contained in Section 5.01(i) or Section 5.01(o), the Company shall
not be entitled to indemnification with respect thereto pursuant to Section
5.05(a), to the extent of amounts in escrow or paid in accordance with this
Section 2.01(d). Seller shall satisfy any Must Removes of record or, as an
alternative to causing such Must Removes to be satisfied of record and
provided that the Title Company agrees to omit such Must Remove(s) from the
Title Policies: (i) bond or cause to be bonded such Must Remove(s), (ii)
deliver or cause to be delivered to the Title Company, on the date of the
Closing, instruments in recordable form and sufficient to satisfy such Must
Remove(s) of record, together with the appropriate recording or filing costs,
or (iii) deposit or cause to be deposited with the Title Company sufficient
monies, acceptable to and reasonably requested by the Title Company, to assure
the obtaining and recording of a satisfaction of the Must Remove(s). With
respect to (a) any condition or state of facts that is set forth on any Title
Commitment, Survey or Search as of date hereof or (b) any Defect (other than
the Must Removes) for which the Company fails to deliver a Defect Notice
thereof in accordance with this Agreement, such Defect or Defect, as the case
may be, shall be deemed approved by the Company and shall constitute a
Permitted Exception hereunder, and the Company shall be obligated to close
without further deduction from the applicable Consideration with respect to
any such items. In the event that any of the foregoing time periods applicable
to the Relevant Purchasers' responses to various notices would otherwise
extend beyond the Closing Date, the Closing Date shall, at the request of the
Relevant Purchasers, be extended on a day for day basis in respect of such
time period.
(e) Substitute Properties In Connection With Title Defects.
Notwithstanding anything to the contrary contained herein, in the event that
any Defect that Seller intended or is otherwise obligated to cure hereunder
has not been cured as of the Closing Date with respect to the applicable
Property in accordance with Section 2.01(c) or Section 2.01(d), such event
shall constitute a "Defect Substitution Event" for purposes of this Agreement.
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(f) Substitution Procedures. If any of (x) a Defect Substitution Event,
(y) a CC Substitution Event (as hereinafter defined) or (z) a Closing
Condition Substitution Event (as hereinafter defined) occurs from time to
time, Seller may in its sole and absolute discretion elect (with respect to a
Defect Substitution Event or a Closing Condition Substitution Event, at any
time at or prior to the applicable Closing; with respect to a CC Substitution
Event, within ten (10) Business Days of delivering notice of such CC
Substitution Event) to retain its interests in such affected Property or
Properties (individually, or collectively, as the context may require, the
"Affected Property") (for purposes of clarity, notwithstanding anything to the
contrary, one Substitute Property may replace more than one Affected Property
if the value of the Substitute Property is greater than or equal to such
replaced Properties) and, in lieu of transferring such interests to the
Company at the Closing, as may be otherwise required by this Agreement, Seller
shall deliver to the Company fee simple title (or Sold Interests, as
applicable) with respect to such Substitute Property, pursuant to the same
terms of this Agreement applicable to any other Property, provided that in the
event that title to the Substitute Property is delivered to the Relevant
Purchaser in accordance with the foregoing, the Company shall obtain the prior
approval of any lender of the Company to release any mortgage or other lien
held by such lender on the Substitute Property in exchange for a lien on the
Property originally required to be delivered at the Closing Date once such
Defect is cured. If the applicable lender does not agree to release such
mortgage or other lien, such mortgage or lien shall, at the sole cost and
expense of Seller, be prepaid in respect of such Substitute Property. For
purposes of this Agreement, "Substitute Property" shall mean a property in the
New York tri-state area (v) with a value (or aggregate value, as applicable),
mutually agreed upon by Seller and the Relevant Purchasers, that is equal to
or greater than that of the Affected Property affected or subject to the
applicable Defect Substitution Event, CC Substitution Event or Closing
Condition Event, (w) generally consistent with the Properties, (x) having
income equal or greater to the amount set forth in the DYNA Model with respect
to such Affected Property, (y) having leases that otherwise comply with the
applicable DYNA Model, and (z) otherwise acceptable to any lender of the
Company providing financing with respect to such Property. Seller shall bear
the costs and expenses of all appraisals required by the foregoing. If such
Substitute Property has a greater value than the value of the Affected
Property, the Consideration (and appropriate components thereof) shall be
increased accordingly. For purposes of this Agreement, the term "DYNA Models"
shall mean those certain net operating income projections for each of the
Properties prepared on behalf of the Company to value the Properties as of the
date set forth in the DYNA Models. If Seller conveys a Substitute Property to
the Company, in lieu of any Property identified on Exhibit B annexed hereto,
Seller shall have the right to require the Company to acquire such Substitute
Property at such time as the conditions set forth in this Agreement with
respect to the acquisition of such Property and the Closing have been
satisfied. Seller shall pay all actual out-of-pocket expenses incurred by the
Company in connection with Seller's exercise of its rights pursuant to the
immediately preceding sentence. It is acknowledged and agreed that upon
substitution of such Substitute Property in accordance with the provisions of
this Section 2.01(f), such substitution shall be deemed to cure the relevant
Defect Substitution Event, CC Substitution Event and/or Closing Condition
Substitution Event applicable to the Affected Property, and notwithstanding
anything to the contrary herein, the Relevant Purchasers shall not be
permitted to (x) exercise any termination right under this Agreement arising
in connection with such Affected Property or (y) to bring any proceeding
otherwise permitted under this Agreement in respect of breach of
representations and warranties or covenants in respect of the Affected
Property. Notwithstanding anything to the contrary in this Agreement, either
party shall have the right, by written notice, to extend the Closing (and all
subsequent Closings on a day for day basis) for up to fifteen (15) Business
Days in order to effectuate the provisions of this Section 2.01(f). This
Section 2.01(f) shall survive the Closing.
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Section 3. Sale Consideration
3.01. Consideration.
(a) Intentionally Omitted.
(b) Intentionally Omitted.
(c) Consideration. Schedule 3.01(c)(i) annexed hereto sets forth (i)
the aggregate agreed upon sales price of the Properties to be sold at the
Closing (referred to herein as the "Consideration")(it being acknowledged and
agreed that the Consideration on the date hereof is One Hundred Five Million
Six Hundred Ninety Six Thousand Nine Hundred Thirty Three and 00/100 Dollars
($105,696,933) for the sale and transfer of each of the Properties to the
Relevant Purchasers at the Closing. Subject to Section 3.02, on the Closing
Date, the Company shall pay to the Owner Operating Partnership or in Seller's
sole and absolute discretion, to the applicable Subsidiary, the Consideration.
(d) De Minimis Consideration; Sales Tax. Seller and the Company
hereby acknowledge and agree that the value of the non-real estate assets
associated with the Properties to be sold to the Relevant Purchasers is de
minimis and no part of the Consideration is allocable thereto. Although it is
not anticipated that any sales tax shall be due and payable, the Company
agrees that the Company shall pay any and all State of New York sales and/or
use taxes imposed upon or due in connection with the transactions contemplated
hereunder under any applicable laws of New York State. The Company shall file
all necessary tax returns with respect to such taxes and, to the extent
required by applicable law, Seller will join in the execution of any such tax
returns.
3.02. Adjustments to Consideration. The amounts set forth in Schedule
3.01(c) shall each be adjusted as of the Closing to reflect any adjustments
made pursuant to Section 2.01(d), Section 13, and any other adjustments to the
Consideration with respect to any Property (plus or minus) made in accordance
with any other term or provision of this Agreement.
3.03. Intentionally Omitted.
3.04. Intentionally Omitted.
3.05. Intentionally Omitted.
Section 4. The Closing
4.01. Closing. Except as otherwise provided in this Agreement, the sale
of the Properties and the payment of the Consideration shall be consummated at
a closing (the "Closing") that shall take place at 10:00 a.m. on September 30,
2005 (the "Closing Date") (anticipated to be the date that is four (4)
business days after receipt by Australian Trust of that portion of the
aggregate subscription price for the initial public offering of units in the
Australian Trust which is payable on the closing date of said initial public
offering), or such other earlier date as may be agreed to by the parties
hereto, and which closing shall be at the offices of Paul, Hastings, Janofsky
& Walker LLP, 75 East 55th Street, New York, New York 10022, or such other
location as the parties may agree upon; provided; however, that if (i) the
underwriting agreement (the "Underwriting Agreement") is not executed by the
parties thereto on or before September 30, 2005 ("Underwriting Deadline") or
(ii) the Closing has not occurred on or before October 31, 2005 (the "Closing
Deadline"), either Seller or the Company may elect, at its option, to
terminate this Agreement by giving the other party written notice of the
exercise of such election at any time after the Underwriting Deadline or the
Closing Deadline, as applicable, whereupon this Agreement
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shall terminate, and neither Seller nor the Company shall have any further
liability to the other hereunder, except for the Surviving Obligations.
4.02. Intentionally Omitted.
4.03. Intentionally Omitted.
4.04. Intentionally Omitted.
4.05. Intentionally Omitted.
4.06. Dates; Times; Dollars. For purposes of clarity, the parties hereto
acknowledge and agree that (x) all references to dates in this Agreement shall
be deemed references to the occurrence of such date in New York, New York, (y)
all references to times shall be deemed references to Eastern Standard Time,
and (z) all references to monetary amounts shall be deemed references to
United States Dollars (such amounts to be paid by Federal Funds Wire Transfer
of immediately available funds), except to the extent expressly noted to the
contrary in this Agreement. In addition, unless otherwise specified herein,
all references to the delivery of "true", "correct", and/or "complete" (A)
copies of any documents, materials and other information and (B) lists or
other disclosures (and, in each case, words of similar import), shall be
deemed to be followed by the words "in all material respects".
Section 5. Representations and Warranties
5.01. Seller Representations and Warranties. Owner Operating Partnership
and each of the Subsidiaries, respectively, represent and warrant as to itself
(and not as to each other or any other entity) and as to the Sold Interests
and the other Properties that it sells (and not as to any other Properties) to
the Relevant Purchasers as follows (notwithstanding the pluralization used in
the following representations and warranties, the breadth of the following
representations and warranties shall not be deemed expanded beyond the scope
indicated by the foregoing):
(a) Such party (x) is a partnership, limited partnership or limited
liability company, as applicable, formed, existing and in good standing under
the laws of the state of its formation, (y) is qualified and in good standing
in each of the states in which each of the Properties directly owned by it are
located (to the extent required by law), except where the failure to do so
would not have a material adverse effect on the ability of such Subsidiary to
fulfill its responsibilities under this Agreement and (z) has the requisite
power and authority (i) to enter into this Agreement and all documents
contemplated hereunder to be entered into by such party, and (ii) to perform
the terms and obligations of such party under this Agreement and such other
documents.
(b) Subject to obtaining the Required Consents, the execution and
delivery of this Agreement and the consummation of the transactions
contemplated hereby on the part of such party have been duly authorized by all
necessary partnership action, limited partnership action or limited liability
company action, as applicable, and no other proceedings or consents on the
part of such party are necessary in order to permit it to consummate the
transactions contemplated hereby.
(c) This Agreement has been duly executed by such party and all of
such party's obligations hereunder are the legal, valid and binding
obligations of such party, enforceable in accordance with the terms of this
Agreement, subject to applicable bankruptcy, insolvency, reorganization,
moratorium, fraudulent transfer and other similar laws relating to or
affecting creditors' rights generally from time to time in effect and to
general principles of equity (including concepts of
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materiality, reasonableness, good faith and fair dealing), regardless whether
considered in a proceeding in equity or at law.
(d) Such party is not the subject of any bankruptcy, reorganization,
insolvency or similar proceedings on the date hereof. To such party's
knowledge, there are no such proceedings threatened against such party, nor
are any such proceedings contemplated by such party.
(e) Annexed hereto as Schedule 5.01(e)-1 is a true, correct and
complete copy of the rent rolls for the Properties (the "Rent Rolls")
identifying and listing, as of the date thereof, by tenant, security deposits,
square footage, and monthly fixed rent. The parties hereto acknowledge that
such Rent Rolls may not list (and, to the extent that such Rent Rolls do not
list, such party makes no representation or warranty with respect to) (i)
subleases, concessions or license agreements which may have been entered into
by tenants or subtenants (unless such subleases, concessions, or license
agreements were known to such party), (ii) license or concession agreements
that have terms not in excess of sixty (60) days or are terminable by the
landlord without penalty, and (iii) kiosks or pushcarts occupied under
agreements that are terminable by the landlord without penalty upon not more
than one month's notice. Annexed hereto as Schedule 5.01(e)-2 is a true,
correct and complete list of all tenant arrearages for all of the Properties.
(f) Annexed hereto as Schedule 5.01(f) is a true, correct and
complete list of all written leases or occupancy agreements for the Properties
(which together with all existing amendments and modifications thereof are
collectively referred to as "Leases"), and true, correct and complete copies
of each Lease have been delivered or made available to the Company. To such
party's knowledge, each Lease is in full force and effect. Except as set forth
on Schedule 5.01(f), to such party's knowledge, such party has not received
any written notice that such party is in breach or default under any Lease,
which breach or default remains uncured on the date hereof. Except as set
forth on Schedule 5.01(f), such party has not sent any written notice to any
of its respective Tenants occupying more than twenty five thousand (25,000)
rentable square feet ("Major Tenant") within the twelve (12) month period
preceding the date hereof asserting that such Major Tenant is in breach or
default under any Lease to which it is a party, which breach or default
remains uncured on the date hereof.
(g) Schedule 5.01(g) annexed hereto is a true, correct and complete
list of all ground leases under which such party is the ground lessee,
including all existing amendments and modifications thereto (collectively
"Ground Leases") affecting the Properties. To such party's knowledge, all
Ground Leases affecting the Properties are in full force and effect. Such
party has not given, nor has such party received, any written notice of a
material default (which remains uncured) under any Ground Lease.
(h) A true, correct and complete list of all agreements for the
payment of leasing commissions by the party holding the interest of landlord
with respect to the Properties under which such landlord is required to pay
any leasing commissions, brokerage fees or any other fee or charge that is due
and payable on or after the Closing is set forth on Schedule 5.01(h) annexed
hereto (such agreements are collectively referred to as the "Brokerage
Agreements").
(i) Schedule 5.01(i) annexed hereto contains a true, correct and
complete list of all Material Service Contracts. For purposes hereof,
"Material Service Contracts" shall mean all contracts (except for Leases,
Ground Leases and Brokerage Agreements) relating to the management, leasing,
operation, maintenance or repair of the Properties or that would otherwise
affect the use, operation or enjoyment of the Properties (collectively,
"Service Contracts") that are either (i) not terminable upon one month's
notice or less without payment or penalty; or (ii) for which the services
thereunder cost in excess of Seventy-Five Thousand ($75,000) Dollars per annum
with respect to any
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individual Property. To such party's knowledge, all of the Material Service
Contracts are in full force and effect and such party has not received written
notice of any material default thereunder. All Service Contracts (other than
those executed in contravention of the terms thereof) shall be assigned to,
and assumed by, the Relevant Purchasers, as applicable, at the Closing for the
Properties affected by such Service Contracts, to the extent such Service
Contracts are assignable and all necessary consents have been obtained.
(j) Except as set forth on Schedule 5.01(j) annexed hereto, (i)
there are currently no capital improvement projects commenced by such party
or, to such party's actual knowledge, costing more than Two Hundred Fifty
Thousand ($250,000) Dollars in the aggregate at any of the Properties other
than maintenance required in the ordinary course of business, (ii) to such
party's knowledge, there are no pending or threatened condemnation
proceedings, and (iii) except as set forth in the Leases no tenant has any
options, rights of first refusal or rights of first offer to purchase any of
the Properties.
(k) Except as disclosed in the reports listed on Schedule 5.01(k)
annexed hereto and/or any other environmental report or update thereto
obtained by the Company from a third party engineer or consultant prior to the
Closing Date (the "Environmental Reports"), or as otherwise noted on Schedule
5.01(k), to such party's knowledge, such party has not received any written
notification which remains uncured from any Governmental Authority having
jurisdiction over this Properties (A) stating that any hazardous materials,
hazardous substances, contaminants or pollutants have been stored, generated,
disposed of, released or transported at, on or from the Properties in
violation of any environmental laws or regulations applicable to the
Properties, and there is no claim pending against such party with respect to
(x) any such violation applicable to the Properties, or (B) with respect to
any corrective or remedial action or cleanup relating to any of the
Properties, whether currently on-going or awaiting final governmental
approval, or (y) any further action letters relating to any of the Properties.
(l) All casualty insurance policies presently in effect with respect
to the Properties are in sufficient amounts and are on commercially reasonable
terms to provide for the "replacement costs" of each of the Properties and the
premiums for all such insurance policies have been paid in full through the
date hereof. Such party has received no written notice from any insurance
carrier that, if not corrected, would result in a termination of insurance
coverage or increase in the present cost thereof. To such party's knowledge,
all insurance policies presently in effect with respect to the Properties are
in full force and effect and either the policies or proceeds thereunder are
fully transferable to the Company.
(m) Such party does not have (i) any employees located at the
Properties or employees located elsewhere whose duties are primarily with
respect to the Properties or (ii) any pension plan liabilities, funded or
unfunded, or employee benefit plan(s), programs, agreements, or arrangements
of any kind pertaining to the Properties or any employees of such party
located at the Properties.
(n) Such party is not a "foreign person" as defined in the Internal
Revenue Code Section 1445, as amended (the "Code Withholding Section").
(o) Except as set forth on Schedule 5.01(o) annexed hereto, there is
no litigation, action, claim, suit, investigation, arbitration or other
adversarial contest or proceeding pending or, to such party's knowledge,
threatened, against such party with respect to any of the Properties or
relating to any of the Ground Leases or the Leases which would in the
aggregate have a material adverse affect on the Properties taken as a whole
(other than claims for personal injury, bodily injury or property
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damage which are reasonably believed by such party to be covered by such
party's existing insurance policies).
(p) Except as set forth in Schedule 5.01(p), there are no
outstanding agreements with attorneys or consultants with respect to tax bills
for a Property that will bind the Relevant Purchasers or the Properties after
the first full tax year after the Closing.
(q) Intentionally Omitted.
(r) Intentionally Omitted.
(s) Intentionally Omitted.
(t) Intentionally Omitted.
(u) Intentionally Omitted.
(v) Such party has prepared and timely filed all tax returns
required to be filed by it on or before the date hereof with respect to the
Properties, which tax returns are true, correct and complete in all material
respects. Such party has paid or made provision for the payment of all taxes
with respect to the ownership and operation of the Properties that are due or
claimed 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
given written notice to such party of any tax deficiency, lien, interest or
penalty or other assessment against such party which has not been paid and no
audit or written inquiry has been commenced or, to the best of such party's
knowledge, threatened by any federal, state, local or foreign tax authority
relating to such party that may be expected to result in a tax deficiency,
lien, interest or other assessment against the assets of such party. Seller
shall pay any and all taxes imposed on the Company based on Seller's failure
to comply with any bulk sales law.
(w) Schedule 7.07 is a true, correct and complete list of all
Required Consents.
(x) Intentionally Omitted.
5.02. Relevant Purchasers Representations and Warranties. The Company
represents and warrants to Seller as to itself and as to and on behalf of all
of the other Relevant Purchasers, if applicable, as follows:
(a) Such party is (a) a limited liability company, organized,
existing and in good standing under the laws of the State of Delaware and has
the requisite power and authority to enter into and perform the terms of this
Agreement and (b) has, since its formation or its acquisition (directly or
indirectly) by the REIT, been classified for federal income tax purposes as a
partnership or disregarded entity and not as a corporation or an association
taxable as a corporation, or a "publicly traded partnership" within the
meaning of Section 7704(b) of the Code.
(b) The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby on the part of such party
has been duly authorized by all necessary limited liability company action and
no other proceedings on the part of such party are necessary in order to
permit it to consummate the transactions contemplated hereby.
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(c) This Agreement has been duly executed by such party and all of
such party's obligations hereunder are the legal, valid and binding
obligations of such party, enforceable in accordance with the terms of this
Agreement, subject to applicable bankruptcy, insolvency, reorganization,
moratorium, fraudulent transfer and other similar laws relating to or
affecting creditors' rights generally from time to time in effect and to
general principles of equity (including concepts of materiality,
reasonableness, good faith and fair dealing), regardless whether considered in
a proceeding in equity or at law.
(d) Such party's performance of its duties under this Agreement will
not conflict with, result in a breach of or be a default under, or be
adversely affected by, any existing agreements, instruments, judgments,
permits, orders, rules, regulations or decrees to which such party is a party
or by which it or its assets are bound.
(e) Such party is not the subject of any bankruptcy, reorganization,
insolvency or similar proceedings.
(f) Intentionally Omitted.
5.03. REIT Representations and Warranties. The REIT represents and
warrants to Seller as follows:
(a) The REIT is a corporation, organized, existing and in good
standing under the laws of the State of Maryland and has the requisite power
and authority to enter into and perform the terms of this Agreement.
(b) The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby on the part of the REIT
have been duly authorized by all necessary limited liability company action
and no other proceedings on the part of the REIT are necessary in order to
permit it to consummate the transactions contemplated hereby.
(c) This Agreement has been duly executed by the REIT and all of the
REIT's obligations hereunder are the legal, valid and binding obligations of
the REIT, enforceable in accordance with the terms of this Agreement, subject
to applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
transfer and other similar laws relating to or affecting creditors' rights
generally from time to time in effect and to general principles of equity
(including concepts of materiality, reasonableness, good faith and fair
dealing), regardless whether considered in a proceeding in equity or at law.
(d) The REIT's performance of its duties under this Agreement will
not conflict with, result in a breach of or be a default under, or be
adversely affected by, any existing agreements, instruments, judgments,
permits, orders, rules, regulations or decrees to which the REIT is a party or
by which it or its assets are bound.
(e) The REIT is not the subject of any bankruptcy, reorganization,
insolvency or similar proceedings.
(f) The REIT is in compliance with the Uniting and Strengthening
America by Providing Appropriate Tools Required to Intercept and Obstruct
Terrorism Act of 2001 , and the regulations promulgated thereunder (the
"Patriot Act"), and comparable regulations. None of the funds contributed to
the REIT have or will be derived from illegal activities or made in
contravention of any United States anti-money laundering laws or regulations.
Neither the REIT nor any of its beneficial
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owners (i) is or will be subject to United States trade sanctions or included
on any United States government published lists of terrorists or terrorist
organizations and (ii) is a "foreign shell bank" as defined under the Patriot
Act.
5.04. (a) Survival of Seller Representations and Warranties; Modification
Thereof. The representations and warranties in this Agreement by Seller are
made as of the date hereof, and shall be remade by Seller as of the date of
the Closing (as applicable to the Properties, and/or the SPE Entities, as
applicable, at the Closing) with the same force and effect as if in fact
specifically remade at that time. If facts or circumstances arising after the
date hereof render Seller unable to remake a representation or warranty in any
material respect as of the Closing, and Seller specifically so advises the
Company, in writing and prior to the Closing (including, without limitation,
by amendment of the schedules hereto), of the particular circumstances
rendering any representation or warranty untrue in any material respect, or if
the same is disclosed in writing in an update to any Title Commitment, Search
or third party report commissioned by the Company in connection with its
review of the Properties, the failure to remake such representation and
warranty shall not constitute a default hereunder by Seller, except (in each
case) in the event or to the extent that the untruth of such representation or
warranty is the result of any act or omission of Seller and/or its Agents in
breach or violation of the terms of this Agreement; notwithstanding the
foregoing, the truth and accuracy of all representations and warranties made
by Seller in this Agreement (required to be true in all material respects as
of the Closing Date pursuant to Section 10.01(b)), as modified to reflect the
operation of the Properties from and after the date hereof in the ordinary
course (including, without limitation, leasing activities with respect
thereto) or as otherwise permitted in accordance with the terms of this
Agreement, shall be a condition precedent to the Company's obligation
hereunder at the Closing. Notwithstanding the foregoing, the parties
acknowledge that if an item is (a) disclosed only on one schedule such
disclosure shall be deemed to be disclosed on any other relevant schedule to
the extent such item is relevant to the representation or warranty in
question, and to the extent such item is inconsistent with such other
schedule, the disclosure of such item on any schedule shall be deemed to
modify the incorrect representation and (b) disclosed in any third party
report delivered in writing by Seller to the Company, such disclosure shall be
deemed to modify the relevant representation and warranty. The representations
and warranties contained in Subparagraphs 5.01(a), (b) and (c) shall survive
the Closing, and the representations and warranties in Subparagraph 5.01(w)
shall survive the Closing for a period equal to the applicable statute of
limitations plus three months. Except as provided in the immediately preceding
sentence and in the next sentence, all other representations and warranties
made in this Agreement by Seller shall survive the Closing for twelve (12)
months from the Closing (the "Rep Survival Period") and shall not merge into
any instrument of conveyance delivered at the Closing. "Seller's Knowledge"
shall be defined for purposes of this Agreement as the current actual (not
constructive, imputed or implied) knowledge, without any duty of inquiry or
investigation, of the Seller. The provisions of this Section 5.04(a) shall
survive the Closing.
(b) Survival of Company and REIT Representations and Warranties. The
representations and warranties in this Agreement by the Company and the REIT
are made as of the date hereof and shall be remade by the Company and the REIT
and as of the Closing. The representations and warranties in Subparagraphs
5.02(a), (b), (c) and (d) and Subparagraphs 5.03(a), (b), (c) and (d) shall
survive the Closing. All other representations and warranties of the Company
and the REIT, if any, shall survive the Closing for the Rep Survival Period
and shall not merge into any instrument of conveyance delivered at the
Closing. The provisions of this Section 5.04(b) shall survive the Closing.
5.05. (a) Indemnification by Seller; Cap; Basket. Notwithstanding
anything to the contrary in this Agreement, but subject to (i) the immediately
succeeding sentence, (ii) Section 2.01(d), and (iii) the Cap (as hereinafter
defined), Seller agrees to and does hereby indemnify, defend and hold harmless
the Company, the SPE Entities and the REIT, their respective constituents and
Agents, and their successors and assigns, from and against any and all
liabilities, claims, demands, suits, administrative
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proceedings, causes of action, costs, damages, personal injuries and property
damages, losses and expenses (including, without limitation, reasonable
attorneys' or other consultants' fees and disbursements, but excluding
consequential, punitive, special and other indirect damages), both known and
unknown, present and future, at law or in equity (collectively, "Losses")
arising out of, by virtue of, or related to, a breach or inaccuracy of any
representation, warranty or covenant of Seller contained in Section 5.01 or
Section 15.01. Notwithstanding the foregoing, no claim for a breach or
inaccuracy of any representation, warranty or covenant of Seller contained in
Section 5.01 or 15.01 shall be actionable or payable (x) unless the valid
claims for all such breaches and inaccuracies collectively aggregate more than
Five Hundred Thousand Dollars ($500,000) (the "Basket") with respect to all
Properties, in which event the amount of all claims in excess of such $500,000
threshold shall be actionable, and (y) unless written notice containing a
description of the specific nature of such breach or inaccuracy shall have
been given by the Company to Seller prior to the expiration of the Rep
Survival Period. The Company, the SPE Entities and the REIT agree to first
seek recovery (using commercially reasonable efforts to do so) under any
insurance polices, Service Contracts, Leases, Title Policies, Ground Lease or
any other agreement for which such recovery is available prior to seeking
recovery from Seller, and Seller shall not be liable to the Company, the SPE
Entities or the REIT to the extent such party's claim is satisfied from such
insurance policies, Service Contracts, Leases or Title Policies, Ground Leases
or any other agreement for which such recovery is available. Notwithstanding
anything contained herein to the contrary, in no event shall Seller's
aggregate liability to the Company, the SPE Entities or the REIT for breach or
inaccuracy of any representation or warranty or covenant of Seller in this
Agreement or as remade as of any Closing Date pursuant to Section 5.04, or in
any other way related to this Agreement and the transactions contemplated
hereby, exceed the amount of the Cap. As used in this Section 5.05, the term
"Cap" shall mean the total aggregate amount of Ten Million and 00/100 Dollars
($10,000,000.00). Notwithstanding anything to the contrary contained herein,
no claim for a breach or inaccuracy of any representation or warranty or
covenant of Seller shall be actionable or payable if the breach or inaccuracy
in question results from or is based on (i) a condition, state of facts or
other matter expressly disclosed in any Review Materials as of the date hereof
or in any Schedule attached to this Agreement, or (ii) if the inaccuracy of,
or failure to make, such representation or warranty as of the Closing does not
constitute a breach, default or violation pursuant to the second sentence of
Section 5.04(a). Notwithstanding anything to the contrary in this Section
5.05(a), the Cap, the Basket and the Rep Survival Period shall not be
applicable to Losses arising from or in connection with the matters described
on Schedule 5.05(a) of this Agreement (the "Special Indemnification Matters"),
it being agreed that Seller shall and does hereby indemnify, defend and hold
harmless the Company, the SPE Entities and the REIT, their respective
constituents and Agents, and their successors and assigns, from and against
any Losses arising out of, by virtue of, or related to, (x) a breach or
inaccuracy of any representation, warranty or covenant of Seller relating to
the Special Indemnification Matters or (y) otherwise relating to the Special
Indemnification Matters; provided, however, Seller shall only be responsible
for Losses in excess of Two Hundred Fifty Thousand and 00/100 Dollars
($250,000.00) arising out of or related to the Special Indemnification
Matters.
(b) Indemnification by Company; Cap; Basket. Notwithstanding
anything to the contrary in this Agreement, but subject to the immediately
succeeding sentence and to the last sentence of this Section 5.05(b), the
Company and the REIT agree to and do hereby indemnify, defend and hold
harmless Seller, its partners, members, shareholders, officers and directors,
and their respective Agents, Affiliates and each of their successors and
assigns, from and against any Losses arising out of, by virtue of, or related
to (i) a breach or inaccuracy of any representation, warranty or covenant of
the REIT or the Company contained in Section 5.02, 5.03 or 16.01 hereof, or
(ii) a release, emission, discharge or disposal of any reportable quantities
of hazardous materials, hazardous substances, contaminants or pollutants at or
from any of the Properties in violation of any U.S. Federal or state
environmental laws or regulations applicable to the Properties to the extent
such violation occurs subsequent to the Closing Date if such release,
emission, discharge or disposal was caused by or at the direction of the
Company or the
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REIT. Seller agrees (and agrees to cause the applicable Relevant Purchaser) to
first seek recovery (using commercially reasonable efforts to do so) under any
insurance policies, Service Contracts, Leases, Title Policies, Ground Leases
or any other agreement for which such recovery is available prior to seeking
recovery from the Company or the REIT, and the Company and the REIT shall not
be liable to Seller to the extent the Seller's claim is satisfied from such
insurance policies, Service Contracts, Leases, Title Policies, Ground Leases
or any other agreement for which such recovery is available.
(c) Exculpation. Notwithstanding anything to the contrary in this
Agreement, but subject to the terms and provisions of Section 5.05(b), neither
party hereto, nor any member or any general or limited partner of such party,
whether direct or indirect, nor any direct or indirect member or any general
or limited partner in such party, nor any disclosed or undisclosed officers,
shareholders, members, principals, directors, employees, partners, servants,
Agents or Affiliates of either party and each of their successors or permitted
assigns, shall have any personal liability with respect to any provisions of
this Agreement and, if after the Closing Date any party is in breach or
default with respect to its respective obligations or otherwise, the other
party hereto shall look solely to such breaching or defaulting party's
interest in and to the proceeds from the sale of the Properties (subject, in
each case, to Section 5.05(a) of this Agreement) for the satisfaction of
remedies hereunder.
(d) Procedures Regarding Indemnification. If a claim or demand for
indemnification is based upon an asserted liability or obligation to a person
or entity not a party to this Agreement nor a permitted successor or assign (a
"Third Party Claim"), then the indemnified party shall give prompt (within the
time required for the filing of any responsive pleading in the case of
litigation) written notice of any such claim to the indemnifying party. The
indemnifying party may defend or settle such claims or actions with counsel
chosen and paid by it by giving written notice (the "Election to Defend") to
the indemnified party within thirty (30) days after the date such notice of a
Third Party Claim is received by the indemnifying party; provided, however,
that the indemnifying party may not settle such claims or action without the
consent of the other party to this Agreement, which consent shall not be
unreasonably withheld, if the indemnified party will not be fully released in
connection therewith. Such notice and opportunity shall be conditions
precedent to any liability of the indemnifying party under this Agreement.
Notwithstanding anything to the contrary in this Agreement, a failure to
provide or delay in providing any required notice shall not prejudice any
right to indemnification under this Agreement except to the extent that the
indemnifying party is prejudiced by such failure. In no event shall the
provisions of this subsection reduce or lessen the obligations of the
indemnifying party under this subsection, if prior to the expiration of such
thirty (30) day notice period, the indemnified party shall respond to a Third
Party Claim if such action is reasonably required to minimize damages or avoid
a forfeiture or penalty or because of a requirement imposed by law. If the
indemnifying party does not duly give the Election to Defend as provided
above, then it shall be deemed to have irrevocably waived its right to defend
or settle such claims, but it shall have the right, at its expense, to attend,
but not otherwise participate in, proceedings with such third parties; and if
the indemnifying party does duly give the Election to Defend, then the
indemnified party shall have the right at its expense, to attend, but not
otherwise participate in, such proceedings. The indemnified party (or its
designee) shall have the right, to the extent permitted by law or regulation,
by written notice given to the indemnifying party at any time, to assume
exclusive control of the defense of any claim insofar as the indemnified party
is concerned, but, subject to the immediately succeeding sentence, the giving
of such notice shall result in the indemnifying party being relieved of its
obligations in respect of such claim under this Agreement. If at any time
during the pendency of a claim the indemnifying party shall disaffirm its
responsibility for such claim, the indemnified party (or its designee) shall
have the right, but not the obligation, to assume the exclusive control of the
defense and settlement of such claim insofar as the indemnified party is
concerned, and all costs and expenses of such defense shall be paid by the
indemnifying party if such claim is within the scope of the indemnification
obligations of the indemnifying party under this Agreement.
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Section 6. Acknowledgments of the Company
6.01. No Prior Representations or Warranties. The Company acknowledges
that except as expressly set forth in this Agreement, neither Seller nor any
agent or representative or purported agent or representative of Seller has
made, and Seller is not liable for or bound in any manner by, any express or
implied warranties, guaranties, promises, statements, inducements,
representations or information (including, without limitation, any information
set forth in offering materials heretofore furnished to the Company)
pertaining to the Properties or any part thereof, the physical condition
thereof, environmental matters, income, expenses or operation thereof or the
uses which can be lawfully made of the same under applicable zoning or other
laws or any other matter or thing with respect thereto, including, without
limitation, any existing or prospective leases, operating agreements or other
agreements. Without limiting the foregoing, the Company acknowledges and
agrees that, except as expressly set forth in this Agreement or any other
agreement or document entered into by the parties in connection with the
transaction contemplated hereby, Seller is not liable for or bound by (and the
Company has not relied upon) any verbal or written statements,
representations, real estate brokers' "set-ups" or offering materials or any
other information respecting the Properties furnished by Seller or any broker,
employee, agent, consultant or other person representing or purportedly
representing Seller. Accordingly, Seller is entering into this Agreement based
upon the Company's assurances that the Company has a well-informed opinion of
the value of the Properties. The Company is not relying upon any
representations made by Seller regarding market conditions which influence the
Properties such as competitive position relative to its existing and potential
future competitors, market rental rates achievable at the Properties, vacancy
assumptions, credit loss and downtime reserves, project growth rates (if any)
in rents or expenses, impact of the sale on assessed values, tenant work and
leasing fee levels necessary to generate estimated market rents, tenant
retention ratios and the need for an amount of any "capital reserves". The
provisions of this Section 6.01 shall survive the Closing.
6.02. As-Is. The Company acknowledges that it has, prior to the date
hereof, inspected the Properties, the physical and environmental condition and
the uses thereof, and the fixtures, equipment and personal property included
in this sale and acquisition to its satisfaction, and the Company has
independently investigated, analyzed and appraised the value and profitability
thereof, the creditworthiness of tenants, and the presence of hazardous
materials, if any, in or on the Properties, that they have received or had
made available to them by Seller, on or prior to the date hereof, copies of
and/or has reviewed the Review Materials and other agreements and documents
referred to or contemplated herein, that they are thoroughly acquainted with
all of the foregoing and that the Company, in entering into this Agreement,
will rely exclusively upon their own independent investigations, analyses,
studies and appraisals and not upon any information provided to the Company by
or on behalf of Seller with respect thereto. AT THE CLOSING, THE COMPANY
AGREES TO ACCEPT THE PROPERTIES SOLD TO THE COMPANY AND/OR THE SPE ENTITIES,
AS APPLICABLE, AT SUCH CLOSING IN "AS IS, WHERE IS" CONDITION, EXCEPT FOR
SELLER'S REPRESENTATIONS, WARRANTIES OR COVENANTS EXPRESSLY CONTAINED IN THIS
AGREEMENT, WITH ALL FAULTS AS OF THE DATE HEREOF AND SPECIFICALLY AND WITHOUT
ANY WARRANTIES, REPRESENTATIONS OR GUARANTEES, EITHER EXPRESS OR IMPLIED AS TO
(I) THE CONDITION, FITNESS FOR ANY PARTICULAR PURPOSE, OR MERCHANTABILITY OF
SUCH PROPERTIES, (II) THE STRUCTURAL INTEGRITY OF SUCH PROPERTIES, (III) THE
ACCURACY OR COMPLETENESS OF ANY INFORMATION, DATA, MATERIALS OR CONCLUSIONS
CONTAINED IN ANY INFORMATION PROVIDED TO THE COMPANY FROM ANY SOURCE
WHATSOEVER, EXCEPT AS OTHERWISE EXPRESSLY PROVIDED HEREIN, (IV) ENVIRONMENTAL
MATTERS PERTAINING TO SUCH PROPERTIES EXCEPT AS SET FORTH HEREIN, OR (V) ANY
OTHER WARRANTY OF ANY KIND, NATURE OR TYPE WHATSOEVER FROM SELLER, EXCEPT AS
MAY BE EXPRESSLY PROVIDED HEREIN, REASONABLE WEAR AND TEAR AND DAMAGE BY FIRE
OR OTHER CASUALTY
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(SUBJECT TO THE PROVISIONS OF SECTION 8.01) BETWEEN THE DATE HEREOF AND THE
CLOSING DATE EXCEPTED, AND THE COMPANY SHALL ASSUME (SUBJECT TO THE PROVISIONS
HEREOF AND APPLICABLE LAW) THE RISK THAT ADVERSE MATTERS, INCLUDING BUT NOT
LIMITED TO, CONSTRUCTION DEFECTS AND ADVERSE PHYSICAL AND ENVIRONMENTAL
CONDITIONS MAY NOT HAVE BEEN REVEALED BY THE COMPANY'S INVESTIGATIONS.
6.03. Environmental Matters. With respect to all matters disclosed in the
Environmental Reports, Seller and the Company agree that the Company shall not
have the right to bring any claim against Seller for any environmental matters
or violation of any environmental laws with respect to the matters disclosed
in such Environmental Report and the Company waives all the rights (at law, in
equity or otherwise) to implead Seller in any action brought with respect to
such environmental matters and waives all rights of contribution against
Seller in connection therewith. The provisions of this Section 6.03 shall
survive the Closing indefinitely.
Section 7. Seller's Obligations as to the Properties
7.01. Operation of Properties Prior to Closing. Prior to the Closing for
each respective Property, Seller agrees that it shall maintain, repair, lease,
manage and operate the Properties in substantially the same manner as Seller
has operated, managed, leased, maintained and repaired the Properties prior to
the date of this Agreement. As it relates to each Property, from and after the
date hereof and through the Closing Date for each such Property, or earlier
termination of this Agreement, Seller shall not (a) remove any material
assets, fixtures, equipment or personal property therefrom (not including any
of the foregoing items to the extent owned by tenants or other occupants of
the Properties) unless the same are replaced with similar items of at least
equal quality prior to the Closing, (b) modify or amend in any material
respect adverse to the landlord, extend, renew or terminate any material
Service Contract, Brokerage Agreement or existing property management
contracts (except as set forth in Section 7.08) or enter into any new Service
Contract (except as set forth in Section 7.02), Brokerage Agreement or
existing property management contracts, without the prior consent of the
Company, which consent shall not be unreasonably withheld, conditioned or
delayed, (c) accept rent from any tenant more than one (1) month in advance
(except as otherwise consistent with past practice), and (d) amend any Lease
in any material respect adverse to the landlord thereunder or enter into any
new or renewal lease, license or other agreement for other than customary and
market terms affecting the ownership or operation of all or any portion of any
Property, without the prior consent of the Company, which consent shall not be
unreasonably withheld, conditioned or delayed; provided, however, Seller may
amend any Lease, or execute any new or renewal lease, license or other
agreement to the extent consistent with (or more favorable to the landlord
than) the DYNA Models without the prior consent of the Company. Any Lease or
Service Contract submitted in writing by Seller to the Company for approval
and not objected to in a writing given by the Company to Seller within five
(5) Business Days after the Company's receipt thereof shall be deemed approved
by the Company. For purposes of this Agreement, the term "Business Days" shall
mean any day other than a Saturday, Sunday and bank holiday in New York State;
if any date on which a party hereunder is required to perform or pay any
amount is not a Business Day, then such date shall be deemed to occur on the
next immediately succeeding Business Day.
7.02. Certain Lease/Service Contract Actions. Notwithstanding anything to
the contrary in Section 7.01, prior to the Closing, Seller may, without the
Company's prior consent, terminate or modify any Lease or Service Contract for
a Property to be sold to the Company at such Closing by reason of a material
default by the tenant (other than a Major Tenant) or service provider, as
applicable, beyond the expiration of any applicable grace or cure period in
the payment of rent or Additional Rent, the performance of any other material
obligation or the provision of services; provided, however, that such
termination or modification is in accordance with the terms of such agreement
or otherwise
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permissible pursuant to this Agreement. In addition, prior to the Closing,
Seller may, with the Company's prior consent, which consent may be withheld in
the Company's sole discretion, terminate or modify any Lease with a Major
Tenant by reason of a material default by such Major Tenant beyond the
expiration of any applicable grace or cure period in the payment of rent or
additional rent and/or the performance of any other material obligation. Any
such termination by Seller prior to such Closing shall not affect the
obligations of the Company under this Agreement in any manner or entitle the
Company to an abatement of or credit against the Consideration or give rise to
any other claim on the part of the Company.
7.03. Certain Prohibited Actions. During the term of this Agreement,
subject to any expressly permissive provisions of this Agreement to the
contrary (including Section 18 of this Agreement), Seller shall not (i) unless
the Property has been substituted for another property not otherwise included
in the Properties, as applicable, and such Property is no longer intended by
the parties to be transferred to a Relevant Purchaser pursuant to this
Agreement, (A) enter into any written agreement for the sale of such Property
with any other party, (B) transfer, mortgage or pledge any interest in any
such Property, except as expressly provided for herein with respect to Leases,
(C) contract for or commence any material construction, capital improvement or
deferred maintenance at any such Property, unless required to do so hereunder,
under the Leases, if requested by any tenant at such tenant's expense, as
required by any law or as a result of an emergency (provided Seller shall
provide notice thereof to the Company as soon as is practical), (D) without
the prior written consent of the Company, not to be unreasonably withheld,
conditioned or delayed, institute prior to the Closing Date, any proceeding or
application for a reduction in the real estate tax assessment of the Property
or any other relief for any tax year unless such taxes are being contested in
good faith and either the taxes being so contested have been paid in full if
so required by the applicable taxing authority or adequate reserves for the
payment of such taxes have been established by Seller which in such instance
shall not require the Company's consent, and if Seller receives any payment of
a rebate of taxes in its favor, Seller will remit to any tenant of the
Properties all or any portion of such rebated sums which is owed to such
tenant, or (ii) enter into any employment contract, employee benefit plan,
program, agreement or arrangement of any kind, union contract or pension plan
which will be binding on the Company upon any Closing.
7.04. Maintenance of Insurance. Seller shall maintain in full force and
effect until each Closing all material insurance policies applicable to the
Properties or any replacements thereof, and shall renew those expiring before
the Closing for no more than one year without the Company's prior written
consent, such that at all times from the date hereof through the Closing Date
there shall be no lapse in such insurance coverage as existed on the date
hereof.
7.05. Required Tenant Estoppels; Seller Estoppel. Prior to (but in no
event earlier than ninety (90) days prior to) the Closing Seller shall provide
to the Company estoppel certificates in the form of Exhibit E annexed hereto
("Tenant Estoppels") from such tenants representing at least seventy (70%)
percent of total leased rentable square footage under all of the Leases in
effect as of the date hereof with respect to the Properties and the Closing.
Notwithstanding the foregoing, if Seller is unable to obtain the Tenant
Estoppels with respect to any Properties, Seller may deliver to the Company at
the Closing substitute estoppel certificates signed by Seller (each a "Seller
Estoppel") representing up to fifteen (15%) percent of the total leased
rentable square footage under all Leases in effect as of the date hereof and
the Company shall accept in lieu of such Tenant Estoppel signed by the tenants
such Seller Estoppels. No Substitute Ground Lessor Estoppel (as defined
hereinafter) shall be counted against the aforementioned fifteen percent (15%)
threshold. In the event that a tenant under a Lease subsequently provides the
Company with a Tenant Estoppel with respect to a Lease for which Seller has
given the Company a Seller Estoppel, the Company shall retain and rely on such
Tenant Estoppel, and the Seller Estoppel given for such Lease will be of no
further force and effect from and after the date on which such Tenant Estoppel
is delivered to the Company, but only to the extent that such Tenant Estoppel
confirms the pertinent
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statements made in such Seller Estoppel. Prior to (but in no event dated
earlier than ninety (90) days prior to the Closing Date). Notwithstanding
anything to the contrary in this Agreement, Seller's obligations and
liabilities under this Agreement with respect to any Seller Estoppel shall not
be subject to the Cap, the Basket or the Representation Survival Period.
7.06. Landlord Estoppels. Prior to (but in no event dated earlier than
ninety (90) days prior to the Closing Date) and as a condition to the Closing
with respect to such Property, Seller shall use its commercially reasonable
efforts to provide to the Company additional estoppel certificates from each
lessor under a Ground Lease in the form of Exhibit F annexed hereto ("Landlord
Estoppel"), provided, that, Seller shall be deemed to have complied with its
obligations under this Section 7.06 to deliver any estoppel certificate or
document so required hereunder from a particular ground lessor, to the extent
that such ground lessor delivers such estoppel certificate or document in the
form prescribed by the applicable Ground Lease. If, notwithstanding such
commercially reasonable efforts, Seller is unable to obtain any Landlord
Estoppels in respect of any Ground Leases, Seller shall be required to deliver
at the Closing a substitute estoppel certificate signed by Seller (each a
"Substitute Ground Lessor Estoppel"). Notwithstanding anything to the contrary
in this Agreement, Seller's obligations and liabilities under this Agreement
with respect to any Substitute Ground Lessor Estoppel shall not be subject to
the Cap, the Basket or the Representation Survival Period.
7.07. Required Consents. Prior to and as a condition to the Closing,
Seller shall deliver to the Company any consents required to consummate the
transactions contemplated by this Agreement, which such consents are listed on
Schedule 7.07 annexed hereto (the "Required Consents").
7.08. Termination of Existing Property Management Agreements. Seller
shall terminate, at Seller's sole cost and expense, in writing all existing
property management contracts for the Properties on or prior to the Closing.
7.09. Intentionally Omitted.
7.10. Intentionally Omitted.
Section 8. Destruction, Damage or Condemnation
8.01. (a) Casualty and Condemnation. If, at any time, an amount of the
Properties greater than or equal to (as reasonably determined by Contributor)
fifteen percent (15%) or more of the Total Consideration of the Properties to
be contributed to the Company is damaged or destroyed by fire or other
casualty ("Casualty") or is taken by eminent domain (or is the subject of a
pending condemnation proceeding that has not been reduced to judgment)
("Condemnation"), on an aggregate basis, then Contributor shall notify the
Company of such fact and, subject to Section 8.01(b) of this Agreement, the
Company shall have the right to terminate this Agreement with respect to all
remaining Tranches by giving written notice to Contributor, provided, however,
that the Company shall be deemed to have elected to proceed with the
acquisition if the Company fails to notify Contributor of its election within
ten (10) Business Days of receipt of such notice. In the case of Casualty, if
the Company elects, or is deemed to have elected, to proceed with the
acquisition of the Property or Properties, then the Company shall accept title
to the Property or Properties in their existing condition, in which event
Contributor shall, subject to the requirements of any financing encumbering
the Property or Properties, assign to the Company, at the applicable Closing,
all of Contributor's right, title and interest in and to the insurance
proceeds awarded or to be awarded to Contributor as the result of such damage
or destruction to such Properties and the Contributed Equity Value or Cash
Portion of Sales Price, as applicable, shall be reduced by the amount of any
deductible in connection with the subject casualty. In the case of
Condemnation, if the Company elects, or is deemed to have elected, to proceed
with the acquisition of the
-21-
Property or Properties (other than the portion so taken), then the Company
shall accept title to the Property or Properties in their existing condition,
and Contributor shall, subject to the requirements of any financing
encumbering the Property or Properties, assign and turn over to the Company at
the applicable Closing, and the Company shall be entitled to receive and keep,
all amounts awarded or to be awarded as the result of the taking of such
Properties; it being understood and agreed that the Contributed Equity Value
or the Cash Portion of Sales Price of the Property or Properties to be
transferred to the Company pursuant to this Section 8.01(a), as applicable,
shall not be reduced by the amounts so awarded or anticipated to be so
awarded. Contributor shall not settle or compromise any insurance claims or
legal actions relating thereto without the Company's prior consent.
(b) Substitute Properties In Connection with Casualty and
Condemnation. Notwithstanding anything to the contrary contained herein, in
the event that a Casualty or Condemnation occurs, and such Casualty or
Condemnation would otherwise permit the Company or the other Relevant
Contributees to exercise termination rights in accordance with the provisions
of Section 8.01(a) of this Agreement, such event shall constitute a "CC
Substitution Event".
Section 9. Additional Covenants of Seller
9.01. Access. Without limiting the effect of the Company's waiver of a
due diligence period, Seller covenants that between the date of this Agreement
and the Closing, subject to the limitations set forth in Section 1.04, Seller
shall allow the Company or the Company's agents, representatives or employees
reasonable access to the Properties, the Leases and other documents required
to be delivered under this Agreement upon reasonable prior notice at
reasonable times during normal business hours; provided, however, that no
drilling, test borings or other material disturbance of any Property may be
conducted by the Company for review of soils, compaction, environmental,
structural or other conditions without the prior written consent of Seller.
Seller (or its designee) shall have the right, but not the obligation, to
accompany the Company or its Agents during such access to the Properties. The
Company shall exercise reasonable diligence not to disturb the use or
occupancy or the conduct of tenant, occupant or business at any Property. The
Company hereby agrees to indemnify, defend and hold harmless the Seller and
its Affiliates (and each of their shareholders, members, officers, directors,
employees, affiliates, agents, successors and permitted assigns) from all
loss, cost, expense, claims, damages or liabilities resulting from any such
entry or inspections performed by the Company or its agents or
representatives, including, without limitation, any mechanic's or
materialmen's liens relating to the activities of such parties; such indemnity
shall survive the termination of this Agreement.
Section 10. Conditions Precedent to Closing
10.01. Conditions Precedent to Company Obligations. Subject to Section
10.03, the Relevant Purchasers' obligations to effectuate the Closing on the
Closing Date are subject to the satisfaction of the following conditions
precedent (collectively, the "Seller Closing Conditions") on or before the
Closing (unless waived in whole or in part by the Relevant Purchasers in
writing):
(a) Delivery of Closing Documents. Seller shall have delivered to or
for the benefit of the Relevant Purchasers, on or before the Closing Date, all
of the documents (including, without limitation, all Tenant Estoppels,
Contributor Estoppels, Landlord Estoppels and Substitute Landlord Estoppels
required under this Agreement), other information and payments, if any,
required of Seller in connection with the Closing pursuant to Section 11.
(b) Representations and Warranties. All of Seller's representations
and warranties made in this Agreement shall be true and correct in all
material respects as of the date hereof and as of the Closing Date, subject in
each case to modification of such representations and warranties
-22-
pursuant to Section 5.05 of this Agreement and as may be otherwise expressly
permitted by the terms of this Agreement. In addition, Seller shall have
performed all of its covenants and other obligations hereunder in all material
respects.
(c) Required Consents. All Required Consents to be obtained or given
pursuant to the terms of any Lease or other material agreement affecting the
Properties in connection with the consummation of the transaction contemplated
by this Agreement in respect of the Closing shall have been obtained or given
by Seller.
(d) Brokerage Obligations. All obligations of Seller under the
Brokerage Agreements with respect to the current, unexpired term of Leases
existing as of the date hereof relating to the Properties shall have been paid
or credited with respect to the Closing for the account of the Company against
the applicable Consideration, except for any obligations and commissions
becoming due and payable following the date of this Agreement and (x)
resulting from the exercise of renewal or expansion options by tenants or (y)
arising in connection with any new leases signed after the date hereof in
accordance with the terms of this Agreement.
(e) Other Material Conditions Precedent. Seller shall have satisfied
or caused to be satisfied all other conditions precedent and covenants with
respect to the Closing set forth in this Agreement in all material respects or
any such unsatisfied condition or covenant shall have been waived in writing
by the Relevant Purchasers.
(f) Owner's Title Policies and Lender Policies. The Title Company
shall be prepared to issue the Title Policies, including, without limitation,
all endorsements (including, without limitation, non-imputation endorsements)
and other affirmative coverage required by any lender or reasonably required
by the Company for all of the Properties, in the name of the Relevant
Purchasers, subject only to the Permitted Exceptions, in each case, subject to
the terms and conditions set forth in this Agreement.
(g) Termination of Management Contracts. All management contracts
affecting the Properties shall have been terminated, effective as of the
Closing, without liability to the Company.
(h) Closing of Relevant Underwriting Transactions. The transactions
under the Underwriting Agreement applicable to the Closing shall have closed.
(i) Listing of Australian Trust. All conditions and requirements for
the listing of Australian Trust on the Australian Stock Exchange and quotation
of its securities have been satisfied (other than administrative requirements
and acquisition of the Properties).
(j) Intentionally Omitted.
(k) Intentionally Omitted.
10.02. Conditions Precedent to Seller Obligations. The Seller's
obligations to effectuate the Closing on the Closing Date are subject to the
satisfaction of the following conditions precedent on or before the Closing
(unless waived in whole or in part by the Seller in writing):
(a) Delivery of Closing Documents and Payments. The Company shall
have delivered to or for the benefit of the Seller, on or before the Closing
Date, all of the documents and payments, if any, required of the Company in
connection with the Closing pursuant to Section 12.
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(b) Conditions Precedent. The Company shall have satisfied or caused
to be satisfied all other conditions precedent to the Closing Date set forth
in this Agreement or any such unsatisfied condition shall have been waived by
Seller.
(c) Representations and Warranties. All of the Company's and the
REIT's representations and warranties made in this Agreement shall be true and
correct in all material respects as of the date hereof and as of the Closing
Date. Moreover, the Company and the REIT shall have performed all of its
covenants and other obligations hereunder in all material respects.
(d) Intentionally Omitted.
(e) Intentionally Omitted.
(f) Listing of Australian Trust. All conditions and requirements for
the listing of Australian Trust on the Australian Stock Exchange and quotation
of its securities have been satisfied (other than administrative requirements
and acquisition of the Properties).
(g) Closing of Relevant Underwriting Transactions. The transactions
under the Underwriting Agreement applicable to the Closing shall have closed.
(h) Intentionally Omitted.
10.03. Effect of Seller's Failure to Meet Conditions.
(a) If Seller shall fail to satisfy any of the Seller's closing
conditions applicable to the Closing, as of the Closing Date, then without
limiting any other right or remedy to which the Relevant Purchasers may be
entitled, the Company shall be entitled, subject to the rights granted to
Seller described in the following sentence, to (i) terminate this Agreement in
its entirety, subject to the Surviving Obligations, provided that the Relevant
Purchasers shall not have the right to terminate this Agreement pursuant to
this clause (i) until the Relevant Purchasers shall have terminated this
Agreement pursuant to the following clause (ii) with respect to one or more
Properties, the individual or aggregate value of which (based conclusively on
the Consideration allocated to such Property or Properties as set forth on the
relevant schedules), is greater than or equal to twenty-five percent (25%) of
the Consideration as of the date hereof (the "Condition Failure Threshold"),
(ii) terminate this Agreement with respect to the affected Property (each such
affected Property as to which this Agreement is terminated, a "Failed Closing
Condition Property") only (in which event (x) this Agreement shall, without
further action of the parties, be deemed to have been automatically and ipso
facto amended so as to eliminate such Failed Closing Condition Property, (y)
the applicable Consideration shall be reduced by the portion thereof allocated
to such Property, and the Cap shall be proportionately reduced, and (z) this
Agreement shall otherwise remain in full force and effect). The foregoing
rights granted to the Relevant Purchasers shall be subject to (a) Seller's
right, exercised by written notice on or before the Closing Date, to extend
the Closing Date by up to thirty (30) days in order to permit Seller, using
commercially reasonable efforts, to satisfy such unsatisfied closing
conditions, and (b) Seller's right to terminate this Agreement in its entirety
from and after such time as the Condition Failure Threshold is reached;
provided, however, that Seller shall be deemed to have waived any of the
foregoing rights that are not exercised in accordance with the foregoing on or
before the Closing Date (as same may have been extended in accordance with the
foregoing or any other provision of this Agreement). Each Failed Closing
Condition Property not replaced with a Substitute Property shall become an
"Option Property" under the Option Agreement, and shall be subject to the
terms and conditions of the Option Agreement.
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(b) Substitute Properties In Lieu of Closing Condition Failure.
Notwithstanding anything to the contrary contained herein, in the event that
any closing condition that Seller intended or is otherwise obligated to
fulfill under this Agreement has not been fulfilled as of the Closing Date
with respect to one or more Properties in accordance with the terms and
conditions of this Agreement, such event shall constitute a "Closing Condition
Substitution Event".
Section 11. Seller's Closing Deliveries
11.01. Seller Closing Deliveries. On the Closing Date, Seller shall
deliver (to the extent not already delivered) the following to the Company:
(a) Leases, Ground Leases, Similar Documents. Originals of all
Leases, Ground Leases, and other similar documents relating to the Properties
and in effect as of the Closing Date, to the extent in Seller's possession or
subject to its control; provided, however, that Seller shall retain all the
foregoing documents during the term of and in accordance with the Services
Agreement.
(b) Security Schedule. A Schedule of all cash security and similar
deposits, held by or on behalf of Seller on the Closing Date under the Leases.
(c) Rent Rolls. Updated Rent Rolls, dated not more than thirty (30)
days prior to the Closing Date and setting forth all arrearages in rents.
(d) Service Contracts. All original Service Contracts or in lieu of
originals, complete certified copies thereof, which are in effect on the
Closing Date and which are assignable by Seller; provided, however, that
Seller shall retain all Service Contracts during the term of the Services
Agreement.
(e) Assignment of Service Contracts, Insurance Policies,
Certificates, Permits and Other Documents. An assignment to the Company and/or
the SPE Entities of all of the interests of Seller in the Service Contracts,
insurance policies (unless provided for in Section 2.01(f)), certificates,
permits and other documents to be delivered to the Company at the Closing
which are then in effect and are assignable by Seller.
(f) Transferable Insurance Policies. With respect to all insurance
policies to be transferred from Seller to the Company (as distinguished from
coverage to be obtained by Seller or the Company in lieu thereof), original
insurance policies, with the Company added on each as an additional insured,
with respect to which premium are to be apportioned or, if unobtainable, true
copies or certificates thereof; provided, however, that Seller shall retain
possession of all such policies during the terms of the Services Agreement.
(g) Certificates, Licenses, Permits, Authorizations and Approvals.
All certificates, licenses, permits, authorizations and approvals issued for
or with respect to the Properties by any Governmental Authority having
jurisdiction thereover to the extent same are transferable to the Company;
provided, however, that Seller shall retain all the foregoing documents during
the term of the Services Agreement.
(h) FIRPTA. A certification of non-foreign status for Owner
Operating Partnership and each Subsidiary, in form required by the Code
Withholding Section, signed under penalty of perjury. Seller understands that
such certification will be retained by the Company and will be made available
to the Internal Revenue Service on request.
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(i) Tenant Notices. An original letter executed by Seller or by its
agent, advising the tenants of the transfer of the Properties to the Company
and directing that rents and other payments thereafter be sent to the Company
or as the Company may direct.
(j) Authority Documents. Corporate resolutions, certificates of good
standing, incumbency certificates and other evidence of authority within
respect to Seller, duly executed where applicable.
(k) Possession. Possession of the Properties in the condition
required by this Agreement, subject to the Leases and Ground Leases, and keys
therefor; provided, however, that Seller shall retain all keys during the term
of the Services Agreement.
(l) Landlord Consents. Original Landlord Consents, if any.
(m) Tenant Estoppels; Landlord Estoppels. All Original Tenant
Estoppels, and any Seller Estoppels in lieu thereof, obtained in accordance
with Section 7.05.
(n) Required Consents. All original Required Consents.
(o) Landlord Estoppels. All Landlord Estoppels or any Substitute
Landlord Estoppels in lieu thereof in accordance with Section 7.06.
(p) Deeds. executed and acknowledged deeds conveying to the Company
fee simple title to the Properties (other than those Properties transferred by
an entity sale pursuant to Section 19 of this Agreement) owned by Seller in
fee simple title, subject to the Permitted Exceptions.
(q) Assignment of Ground Leases. Executed and acknowledged
assignments and assumptions of ground leases (collectively, the "Assignments
of Ground Leases"), assigning and transferring to the Company, as applicable,
all right, title and interest of Seller in and to, and all post-Closing
obligations of the lessee under, all Ground Leases affecting the Properties
(other than those Properties transferred by an entity sale pursuant to Section
19 of this Agreement).
(r) Assignment of Leases. Executed and acknowledged assignments and
assumptions of leases (collectively the "Assignments of Leases"), assigning
and transferring to the Company, as applicable, all right, title and interest
of Seller in and to, and all post-Closing obligations of the lessor under, all
Leases affecting the Properties (other than those Properties transferred by an
entity sale pursuant to Section 19 of this Agreement).
(s) Bills of Sale. Executed bills of sale transferring to the
Company, as applicable, all personal property owned by Seller and located at
or attached to the Properties (other than those Properties transferred by an
entity sale pursuant to Section 19 of this Agreement).
(t) Required Forms. Transfer tax returns, certificates and/or any
other document or instrument required by any federal, state or local
government or municipality to transfer or convey the Properties or to record
any deed or assignment of lease, including, without limitation, any forms
relating to environmental matters required to be filed in connection with the
transfer of the Properties located in Connecticut (collectively, the "Required
Forms").
(u) Services Agreement. An executed Services Agreement.
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(v) Substitute Property Documentation. Any documentation reasonably
requested by the Company, any lender or the Title Company in connection with a
Substitute Property.
(w) Agreements. Counterparts of (w) the Option Agreement (the
"Option Agreement") in the form attached hereto as Exhibit N, (x) this
Agreement, (y) the LLC Agreement, and (z) the Portfolio Services Agreements,
duly authorized, executed and delivered by all of the parties thereto. The
foregoing, collectively, the "Transaction Agreements".
(x) Excluded Property License Agreements. Counterparts of the
Excluded Property License Agreements, duly authorized, executed and delivered
by the Seller.
(y) Estoppels. Seller shall have delivered to or for the benefit of
the Company the requisite Tenant Estoppels, Seller Estoppels, Landlord
Estoppels, and/or Substitute Ground Lessor Estoppels required under Sections
7.05 and 7.06.
(z) Other Documents. any other documents required by this Agreement
to be delivered by Seller (executed and acknowledged where appropriate) or
otherwise necessary or reasonably required to consummate this transaction as
contemplated herein.
11.02. Delivery Requirements for SPE Entity. In the event that an SPE
Entity is the Relevant Purchaser hereunder, delivery to the Company shall
satisfy the delivery requirements hereunder and the deliverables required
under Section 11.01 shall be appropriately modified to reflect the intended
sale to such Relevant Purchaser. The deliveries required under this Section 11
shall be subject to modification pursuant to Section 20 of this Agreement in
connection with a transfer of entity interests in lieu of an asset transfer.
Section 12. The Company's Closing Deliveries
12.01. Company Deliveries. On the Closing Date, Company shall deliver (to
the extent not already delivered) the following to the Seller:
(a) LLC Agreement. The LLC Agreement executed by the Company and the
REIT.
(b) Assumption of Service Contracts, Insurance Policies,
Certificates, Permits and Other Documents. An executed assumption by the
Company and the SPE Entities, as applicable, of all of the interests of Seller
in those Service Contracts, insurance policies, certificates, permits and
other documents to be delivered to the Company at the Closing which are then
in effect and are assignable by Seller.
(c) Portfolio Services Agreement. Executed Portfolio Services
Agreements.
(d) Assignments of Ground Leases and Leases. Executed and
acknowledged Assignments of Ground Leases and the Assignments of Leases.
(e) Intentionally Omitted;
(f) Required Forms. Executed and acknowledged Required Forms to the
extent a purchaser is required to execute and acknowledge the same.
(g) Intentionally Omitted.
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(h) Payment of Consideration. On the Closing Date, the Consideration
(plus or minus net adjustments and prorations pursuant to this Agreement)
payable to Seller on the Closing Date.
(i) Assumption and Indemnity Relating To Ground Leases. An
assumption by the Company or an SPE Entity (as applicable), of, and an
indemnity from the Company in favor of Seller (and/or its Affiliates or
affiliates, but only to the extent they are signatories under any such
indemnity and/or guaranty), in a form and substance reasonably satisfactory to
Seller, with respect to, any guarantees and related documents under the Ground
Leases from which Seller (and/or any of its Affiliates and such other
affiliates) is not released from liability from and after the Closing Date,
for any Losses arising on or after the Closing Date.
(j) Intentionally Omitted.
(k) PHJW Opinion. An opinion from Paul, Hastings, Janofsky & Walker
LLP, in the form attached hereto as Exhibit I.
(l) Agreements. Counterparts of the Transaction Agreements (as
defined in Section 11.01 of this Agreement), duly authorized, executed and
delivered by all of the parties thereto except the Relevant Purchasers.
(m) Intentionally Omitted.
(n) Excluded Property License Agreements. Counterparts of the
Excluded Property License Agreements, duly authorized, executed and delivered
by the Relevant Purchasers.
(o) Other Documents. Any other documents required by this Agreement
to be delivered by the Company (executed and acknowledged, where appropriate)
or otherwise necessary or reasonably required to consummate this transaction
as contemplated herein.
In the event that an SPE Entity is the Relevant Purchaser hereunder,
delivery to the Company shall satisfy the delivery requirements hereunder and
the deliverables required under Section 12.01 shall be appropriately modified
to reflect the intended sale to such Relevant Purchaser. The deliveries
required under this Section 12 shall be subject to modification pursuant to
Section 20 of this Agreement in connection with a transfer of entity interests
in lieu of an asset transfer.
Section 13. Apportionments; Closing Costs
13.01. General Apportionments. The following apportionments shall be made
between the parties at the Closing as of 11:59 p.m. on the day prior to the
Closing Date:
(a) rent payments (including prepaid rents) and Additional Rent
actually received by Seller under the Leases, excluding, however, any "advance
rent" paid in advance by tenants under such Leases in respect of the last
month of the term of such Leases (such advance rent, the "Advance Rent").
(b) to the extent not paid directly by tenants under the Leases,
water charges, sewer rents, other utility charges and vault charges, if any,
on the basis of the fiscal period for which assessed, except that if there is
a water meter at the Properties, apportionment at the Closing shall be based
on the last available reading, subject to adjustment after the Closing when
the next reading is available.
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(c) value of fuel stored at the Properties at the price then charged
by Seller's supplier, including any taxes.
(d) charges under transferable Service Contracts and other
transferable agreements pertaining solely to the Properties or permitted
renewals or replacements thereof.
(e) permitted administrative charges, if any, on tenants' security
deposits.
(f) insurance premiums and transfer premiums on transferable
insurance policies or permitted renewals thereof.
(g) insurance premiums on insurance policies that are not
transferred to the Company but under which coverage is provided to the Company
from and after the Closing.
(h) rent under all Ground Leases.
(i) to the extent not paid directly by tenants to taxing authorities
pursuant to the Leases, real estate taxes and personal property taxes for the
current fiscal year.
(j) outstanding leasing commissions, tenant improvement obligations,
free rent and other concessions of the landlord under any new or renewal
leases entered into after the date hereof pursuant to Section 7.01 (such
apportionment to be made based on the fixed term of such new or renewal
lease).
(k) Intentionally Omitted.
(l) Such other items customarily apportioned in real estate closings
of commercial properties in the New York tri-state area.
13.02. Adjustment of Taxes. The adjustment of real estate and personal
property taxes shall be made on the basis of presently available evidence of
such taxes, subject to adjustment by payment from Seller to the Company, or
the Company to Seller, whichever is applicable, after the Closing due to any
change in assessment, applicable rate or other reason. Notwithstanding the
foregoing, all or any portion of any special assessments, that are a lien as
of such Closing and that are not otherwise recoverable from tenants under the
Leases shall be paid by Seller. This Section 13.02 shall survive the Closing
and/or sooner termination of this Agreement.
13.03. Credits. The following adjustments to the Consideration shall be
made between the parties at the Closing:
(a) To the extent not assigned or otherwise transferred to the
Relevant Purchasers, the Company and the SPE Entities, as applicable, shall be
credited and Seller charged with security deposits (together with any interest
accrued thereon) or advance rentals made by tenants under the Leases, the
Ground Leases and any additional Leases entered into by Seller pursuant to
Section 7.01.
(b) To the extent not assigned or otherwise transferred to the
Relevant Purchasers, Seller shall be credited and the Company and the SPE
Entities, as applicable, charged with deposits under any Service Contracts
assigned to the Company at the Closing, and any other transferable deposits to
be transferred in connection with the transactions contemplated hereunder.
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(c) The Company and the SPE Entities shall be credited, and Seller
charged with, all unpaid leasing commissions and tenant improvement
obligations, to the extent applicable to Leases in effect as of the date
hereof (but not including any commissions that may result from the exercise
after the Closing of renewal or expansion options by tenants).
(d) Intentionally Omitted.
(e) The Seller shall be credited, and the Company and the SPE
Entities, as applicable, charged with, amounts paid or payable (including any
bonds or security deposits) under telephone and telex contracts and contracts
for the supply of heat, steam, electric power, gas, lighting and any other
utility service, with Seller receiving a credit for all deposits, if any, made
by Seller as security under any such public service contract(s) if the same is
transferable and provided such deposit remains on deposit for the benefit of
the Company. (In addition, the parties agree to work together in good faith to
determine, before the expiration of the Closing Date, the manner in which
other bonds and security deposits with respect to the Properties will be
handled from and after the Closing. Without limiting the foregoing, the
parties will use good faith efforts to agree as to (i) whether the Company (or
the applicable SPE Entity) should substitute its own bonds and/or security
deposits for those previously posted by Seller, and (ii) which party shall
have responsibility for the cost of any such bond and their respective periods
of responsibility therefor.
13.04. Tenant Arrearages. If any tenant is in arrears in the payment of
rent or Additional Rent on the Closing Date for which the Property affected by
such tenant is being sold, rents received from such tenant after such Closing
shall be applied in the following order of priority:
(a) first to the month in which such Closing occurred;
(b) second to the month prior to the Closing;
(c) third to the months after the Closing; and
(d) fourth to any month or months prior to the Closing.
If rents or Additional Rents or any portion thereof received by Seller or the
Company after the Closing are payable to the other party by reason of this
allocation, the appropriate sum, less a proportionate share of any reasonable
attorneys' fees, out-of-pocket costs and expenses of collection thereof, shall
be promptly paid to the other party, which obligation shall survive the
Closing.
13.05. Additional Rent. If any tenant is required to pay percentage rent,
escalation charges for real estate taxes, common area maintenance charges,
operating expenses, cost-of-living adjustments or other charges of a similar
nature ("Additional Rent"), and any Additional Rent is collected by the
Company or Seller on behalf of the Company after the Closing for the sale of
the Property affected by such tenant which accrued prior to the Closing and
was not otherwise adjusted, then the Company shall promptly pay Seller's
proportionate share thereof to Seller, less any reasonable attorneys' fees,
and any other reasonable out-of-pocket costs and expenses of collection
thereof, which obligation shall survive the Closing.
13.06. Closing Statements. On or before the Closing, Seller will prepare
and the Company shall review and approve (which approval shall not be
unreasonably withheld or delayed) a final closing statement (the "Final
Closing Statement") setting forth the final determination of all open items
and other apportionments estimated as of the Closing to be included on the
closing statements for the Closing and any re-adjustment required to "true up"
any amounts adjusted under Section 13.01
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(including, without limitation, Additional Rent). The net amount due to Seller
or the Company, if any, by reason of adjustments to the closing statement as
shown in the Final Closing Statement, shall be paid or credited to the
applicable party at Closing. The adjustments, prorations and determinations
agreed to by Seller and the Company under this Section 13.06 shall be
conclusive and binding on the parties hereto. Notwithstanding the foregoing,
if at any time within the three hundred sixty five (365) day period following
the Closing (such period being referred to herein as a "Post-Closing
Adjustment Period"), the amount of any item to be apportioned or credited
pursuant to this Agreement shall prove to be incorrect (whether as a result in
an error in calculation or a lack of complete and accurate information as of
the Closing), the party in whose favor the error was made shall promptly pay
to the other party the sum necessary to correct such error upon receipt of
proof of such error, provided that such proof is delivered to the party from
whom payment is requested within the Post-Closing Adjustment Period. In order
to enable Seller to determine whether any such delayed adjustment is
necessary, the Relevant Purchasers shall provide to Seller such information as
Seller shall reasonably request during the Post-Closing Adjustment Period in
order to confirm or finalize closing adjustments hereunder. The provisions of
this Section 13.06 shall survive the Closing and not be merged therein.
13.07. Closing Costs. Subject to the other provisions of this Section 13,
the following shall apply to closing costs:
(a) Company Closing Costs. At the applicable Closing, the Company
shall pay (x) all mortgage recording taxes and (y) any other cost or expense
set forth in this Agreement explicitly to be paid by the Company.
(b) Seller Closing Costs. At the Closing, Seller shall pay (i) all
recording fees on any document recorded pursuant to this Agreement to
discharge Liens and encumbrances which are not Permitted Exceptions in
accordance with the terms and provisions hereof, (ii) all costs incurred in
obtaining the required consents, the Tenant Estoppels, and any Seller
Estoppels in lieu thereof per Section 7.05, and all other required estoppel
certificates per Section 7.06, and (iii) any other cost or expense set forth
in this Agreement explicitly to be paid by Contributor.
(c) REIT Closing Costs. At the Closing, the REIT shall pay (i) all
costs for any document to be recorded pursuant to this Agreement or the LLC
Agreement, (ii) the cost of the title examination, the Title Commitments and
the title insurance premiums, including any extended coverage and
endorsements, incurred in connection with the issuance of the Title Policies
and any same costs associated with any lender title insurance policies, (iii)
the cost of any Survey, (iv) any escrow fee which may be charged by the Title
Company, (v) the cost of Phase I environmental site assessments, other
environmental reports and engineering reports, (vi) the cost of appraisals,
(vii) all prepayment premiums and penalties on any loan encumbering any of the
Properties required to be paid by any party hereto at any Closing, (viii)
intentionally omitted, (ix) all costs associated with the transfer of
insurance policies, and (x) subject to Section 20, all of the state and local
transfer taxes, documentary stamp tax or similar tax required to be paid in
the States, counties, cities and/or towns in which the Properties are located.
(d) Other Costs and Expenses. Except as expressly set forth herein,
each party shall pay its own attorney's fees and all of its other costs and
expenses.
Section 14. Failure of Seller or the Company to Perform
14.01. Company Default/Breach Prior to Closing. If, prior to the Closing,
the Company and/or the REIT shall materially default in the performance of any
of its obligations under this Agreement, or shall materially breach any of its
representations, warranties or covenants contained in this Agreement, and such
default or breach shall remain uncured for ten (10) days after the Company
receives
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written notice thereof from Seller, then Seller, as its sole and exclusive
remedy, may either (i) terminate this Agreement and recover from the Company
and/or the REIT the Seller's actual out of pocket costs incurred in connection
with this Agreement and the transactions contemplated herein or (ii) in its
sole and absolute discretion, commence an action against any such party for
specific performance of such obligations hereunder (subject to all of the
terms of this Agreement). If Seller elects to terminate this Agreement
pursuant to this Section 14.01, this Agreement shall be of no further force
and effect except for the Surviving Obligations, which shall remain in effect
as provided herein.
14.02. Seller Default/Breach Prior to Closing. If, prior to the Closing,
the Seller shall materially default in the performance of any of its
obligations under this Agreement, or shall materially breach any of its
representations, warranties or covenants contained in this Agreement, and such
default shall remain uncured for ten (10) days after the Seller receives
written notice thereof from the Company, then the Relevant Purchasers may
either (i) in their sole and absolute discretion, commence an action against
any such party for specific performance of such obligations hereunder (subject
to all of the terms of this Agreement), or (ii) terminate this Agreement and
recover from the Seller the Relevant Purchasers actual, out of pocket costs
incurred in connection with this Agreement and the transactions contemplated
herein. If the Relevant Purchasers elect to terminate this Agreement pursuant
to this Section 14.02, this Agreement shall be of no further force and effect
except for the Surviving Obligations, which shall remain in effect as provided
herein.
14.03. Termination of Agreement Regarding Aggregation of Title, Survey,
Closing Condition, Condemnation and Casualty Events. Notwithstanding anything
to the contrary herein, if at any time one or more Properties is affected by
any combination of title defects, survey defects, casualty, condemnation, or
closing condition failures and the aggregate value of the Properties lost or
subject to such events exceeds twenty-five percent (25%) of the Consideration
in respect of the Properties to be contributed under this Agreement, then
Contributor shall have the continuing right to terminate this Agreement by
providing written notice of such termination to the Relevant Purchasers.
Section 15. Broker
15.01. Broker Representation and Warranty; Indemnification. Seller and
the Company mutually represent and warrant to each other that neither Seller
nor the Company knows of, or has dealt with, any broker, finder, salesperson
or similar agent who has claimed or may have the right to claim a commission
in connection with this transaction. Seller and the Company shall, subject to
the Cap, indemnify and defend each other against any costs, claims or
expenses, including reasonable attorneys' fees, arising out of the breach on
their respective parts of the representations and warranties or agreements
contained in this Section 15. The representations and obligations under this
Section 15 shall survive the Closing or, if the Closing does not occur, the
termination of this Agreement.
Section 16. Notices
16.01. Method of Notification and Delivery. Any notices, demands,
consents, approvals and other communications ("Notice") provided for in this
Agreement or given in connection with this Agreement shall be given in writing
by (a) personal delivery, (b) reputable overnight delivery service with proof
of delivery, (c) United States Mail, postage prepaid, registered or certified
mail, return receipt requested, deposited in a United States post office or a
depository for the receipt of mail regularly maintained by the post office, or
(d) legible facsimile transmission sent to the intended addressee at the
address set forth below, or to such other address or to the attention of such
other person as the addressee shall have designated by giving at least ten
(10) days written notice sent in accordance herewith, and Notice shall be
deemed to have been given by (i) personal delivery, when received as evidenced
by an affidavit of the person making such delivery, (ii) in the case of
expedited delivery service, next Business
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day following the date sent and (iii) mail, then received by the addressee on
the date received as evidenced by a return receipt. When received in the case
of facsimile transmission, as of the date of the facsimile transmission
provided that an original of such facsimile is also sent to the intended
addressee by means described in clauses (a) or (b) above. The inability to
make delivery because of change of address of which notice was given or by
reason of rejection or refusal to accept delivery of any Notice shall be
deemed to be receipt of the Notice as of the date of such inability to deliver
or rejection or refusal to accept. Unless changed in accordance with the
preceding sentence, the addresses for notices given pursuant to this Agreement
shall be as follows:
If to Seller:
c/o Reckson Associates Realty Corp.
225 Broadhollow Road
Suite 212W
Melville, New York 11747
Attn: General Counsel
Fax: 631-622-8994
with a copy to:
Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, NY 10019
Attn: Stephen G. Gellman
Fax: 212-403-2246
Telephone: 212-403-1246
Email: SGGellman@wlrk.com
If to the Company:
c/o Reckson Associates Realty Corp.
225 Broadhollow Road
Suite 212W
Melville, New York 11747
Attn: Francis Sheehan, Vice President, Legal-Corporate
Fax: 631-622-8994
Telephone: 631-622-6777
Email: FSheehan@Reckson.com
with a copy to:
Paul, Hastings, Janofsky & Walker LLP
75 East 55th Street
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New York, New York 10022
Attn: Robert J. Wertheimer, Esq.
Fax: 212-318-6936
Telephone: 212-318-6550
Email: Robertwertheimer@paulhastings.com
Section 17. Miscellaneous Provisions
17.01. Assignment or Transfer. Subject to Section 18.01 of this
Agreement, no party hereto shall assign this Agreement or its rights hereunder
without the prior written consent of the other parties hereto. Notwithstanding
anything herein to the contrary, the Company shall have the right to instruct
Seller to convey title to any of the Properties to any wholly-owned subsidiary
of the Company designated in writing by the Company at least five (5) Business
Days prior to the Closing, and (ii) Seller may, without the Company and/or the
REIT's consent, assign all or any part of its rights hereunder to an Affiliate
thereof.
17.02. Integration Clause. This Agreement embodies and constitutes the
entire understanding between the parties with respect to the sale of the
Properties to the Relevant Purchasers and all prior agreements,
understandings, representations and statements, oral or written, are merged
into this Agreement.
17.03. Amendments. Neither this Agreement nor any provision hereof may be
waived, modified, amended, discharged or terminated except by an instrument
signed by both parties hereto, and then only to the extent set forth in such
instrument. 17.04. Governing Law. This Agreement shall be governed by, and
construed in accordance with, the law of the State of New York without regard
to its principles of conflicts of law.
17.05. Captions. The captions in this Agreement are inserted for
convenience of reference only and in no way define, describe or limit the
scope or intent of this Agreement or any of the provisions hereof. Unless
otherwise specified, all references to Sections, sections or provisions in
this Agreement refer to such Sections, Section or provisions as set forth
herein.
17.06. Successors and Assigns. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective
successors and permitted assigns.
17.07. Masculine and Feminine Terms. As used in this Agreement, the
masculine shall include the feminine and neuter, the singular shall include
the plural and the plural shall include the singular, as the context may
require.
17.08. Schedules and Riders. If the provisions of any Schedule or rider
to this Agreement are inconsistent with the provisions of this Agreement, the
provisions of such Schedule or rider shall prevail.
17.09. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall constitute an original and all of which,
when taken together, shall constitute a single instrument.
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17.10. No Recordation. This Agreement shall not be recorded.
17.11. No Third Party Beneficiaries. This Agreement is for the sole
benefit of the parties hereto and their respective successors and permitted
assigns, and no other person or entity shall be entitled to rely upon or
receive any benefit from this Agreement or any term hereof.
17.12. No Offer. The submission of this Agreement for examination does
not constitute an offer by or to either party. This Agreement shall be
effective and binding only after due execution and delivery by the parties
hereto.
17.13. Jurisdiction; Service of Process. The parties hereto each hereby
irrevocably and unconditionally:
(a) submits for itself and its property in any legal action or
proceeding relating to this Agreement, or for recognition and enforcement of
any judgment in respect hereof, to the non-exclusive general jurisdiction of
the courts of the State of New York, the federal courts of the United States
of America for the Southern District of New York, and appellate courts from
any thereof;
(b) consents that any such action or proceeding may be brought in
such courts and, to the extent permitted by law, waives any objection that it
may now or hereafter have to the venue of any such action or proceeding in any
such court or that such action or proceeding brought in an inconvenient court
and agrees not to plead or claim the same;
(c) agrees that service of process in any such action or proceeding
may be effected by mailing a copy thereof by registered or certified mail (or
any substantially similar form of mail), postage prepaid, to its address set
forth hereunder; and
(d) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by law or shall limit the
right to sue in any other jurisdiction in the continental United States.
17.14. Further Assurances; Cooperation Regarding Consents. Subject to the
terms and conditions herein provided, each of the parties hereto shall execute
and deliver such documents as the other party shall reasonably request in
order to consummate and make effective the transactions contemplated herein;
provided, however, that the execution and delivery of such documents by such
party shall not result in any additional liability or cost to such party. Each
of the parties shall use commercially reasonable efforts to cooperate in order
to obtain any Required Consents.
Section 18. Certain Tax Matters
18.01. Like-Kind Exchanges. The Company and Seller acknowledge and agree
that Seller may elect no later than five (5) days prior to the Closing Date,
to execute and assign to an exchange facilitator, qualified intermediary,
exchange accommodation titleholder or similar entity its interest in this
Agreement with respect to any of the Properties specified by Seller (the
"Excluded Properties") to facilitate a like-kind exchange of the Excluded
Properties in a transaction or transactions which are intended to qualify for
treatment as a tax-deferred like-kind exchange pursuant to the provisions of
Section 1031 of the Internal Revenue Code (a "1031 Exchange"). Subject to
Section 19, Seller's election to proceed with a 1031 Exchange of such
Properties may include transfers of equity interests in entities, the merger
and/or consolidation of entities and/or the creation of other entities such as
single member limited liability companies. If Seller so elects, the Company
shall cooperate (at no expense or liability to it) in effectuating the 1031
Exchange of the such Properties and in implementing any such assignment
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and/or execution of any documentation, provided that (i) Seller shall
indemnify the Company for all direct costs and expenses incurred by the
Company in connection with an intended or effectuated 1031 Exchange of such
Properties, (ii) the Company shall not be obligated to take title to any other
property, nor shall this Section 18.01 affect in any manner Seller's
obligations or the Company's rights and benefits under this Agreement (except
to the extent that each such Property shall no longer be subject to the
provisions of this Agreement), and (iii) it is expressly understood that the
consummation by Seller or the ability by the electing party to consummate its
intended 1031 Exchange is not a condition precedent to Seller's obligation to
consummate the Closing. The Cap shall be proportionately reduced upon the
occurrence of the transactions contemplated in this Section 18.01.
Section 19. Entity Transfers.
19.01. Entity Transfer Provisions. For the purposes hereof, the term
"Sold Entity" shall mean any entity wholly owned (directly or indirectly) by
the Seller and now or hereafter owning one or more of the Properties to be
acquired pursuant to this Agreement. If the Seller reasonably determines,
prior to the Closing, that a transfer of all of Seller's interests in and to
the Sold Entity to the Company or the SPE Entities (each such sequence of
transactions, or any portion thereof, an "Entity Transfer") in lieu of an
asset sale of such Properties as otherwise provided under this Agreement,
would result in a savings in costs, expenses or other liabilities to be
incurred by Seller hereunder or in connection herewith, then the Seller shall,
at least ten (10) Business Days before the Closing, notify the Relevant
Purchasers of Seller's desire to effectuate such Entity Transfer and the
Relevant Purchasers shall, within five (5) Business Days of such notice,
notify Seller of the Relevant Purchasers' approval or disapproval of such
request for an Entity Transfer; provided, however, that such approval shall
not be unreasonably withheld or conditioned if the cooperation required of the
Relevant Purchasers to effectuate such Entity Transfer shall not result in any
unreimbursed increased cost or expense (other than the expense for additional
Searches) or any materially increased obligations or liabilities of the
Company (other than those customarily arising in connection with the transfer
of interests in an entity owning similar property or properties in lieu of
transfers of the underlying property or properties). Failure of the Relevant
Purchasers to respond within the aforementioned five (5) Business Day period
shall be deemed approval of such Entity Transfer. The Relevant Purchasers
shall reasonably cooperate with Seller to effectuate each Entity Transfer that
is approved or deemed approved by the Relevant Purchasers. In connection with
each such Entity Transfer, Seller shall (i) provide, in writing, as of the
Closing Date, such additional representations and warranties related to such
Sold Entity (or the interests in such Sold Entity that are subject to the
Entity Transfer) as may be reasonably requested by the Company and customarily
required in similar transactions, and (ii) provide to the Relevant Purchaser
at the Closing (A) subject to the Cap, an indemnity in favor of the Relevant
Purchasers for losses related to such Sold Entity for matters arising prior to
the Closing Date, in form and substance reasonably satisfactory to the Company
(it being acknowledged and agreed that such indemnification shall be deemed to
eliminate the Company's right to withhold approval of any Entity Transfer on
the grounds that matters covered in such indemnification will result in
materially increased obligations, liabilities, costs or expenses) and (B) any
other documentation reasonably requested by the Company or by any lender of
the Company to the extent customarily required in similar transactions.
Section 20. Certain Provisions Regarding SPE Entities.
20.01. SPE Entities. The Company acknowledges and agrees that it shall
provide Seller with the organizational and authorization documents relating to
each of the SPE Entities prior to the Closing and that, as of the Closing
Date, such SPE Entities shall assume, and shall be jointly and severally
liable for, all obligations and liabilities of the Company in respect of the
Property to be sold to such SPE Entity, and shall be entitled to all of the
rights and benefits of the Company in respect of such Property as may be
provided under this Agreement. Prior to the Closing, the Company shall cause
the
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relevant SPE Entity to execute a joinder agreement in form and substance
reasonably satisfactory to Seller to effectuate the foregoing.
[Signature Pages Immediately Follow]
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SELLER
------
For the following Properties:
505 White Plains Road, Tarrytown, NY;
55 Charles Lindbergh Boulevard, Hempstead, NY;
200 Broadhollow Road, Melville, NY;
560 White Plains Road, Tarrytown, NY;
555 White Plains Road, Tarrytown, NY:
RECKSON OPERATING PARTNERSHIP,
L.P., a Delaware limited partnership
By: RECKSON ASSOCIATES REALTY
CORP., its general partner
By: /s/ Michael Maturo
-----------------------------
Name: Michael Maturo
Title: Chief Financial Officer and
Executive Vice President
RA 10 ROONEY CIRCLE LLC, a
Delaware limited liability company;
By: RECKSON OPERATING PARTNERSHIP,
L.P,, a Delaware limited partnership
By: RECKSON ASSOCIATES REALTY
CORP., its general partner
By: /s/ Michael Maturo
----------------------------
Name: Michael Maturo
Title: Chief Financial Officer and
Executive Vice President
For the following Properties:
300 Motor Parkway, Smithtown, NY;
88 Duryea Road, Melville, NY:
RECKSON FS LIMITED PARTNERSHIP,
a Delaware limited partnership
By: RECKSON OPERATING PARTNERSHIP,
L.P,, a Delaware limited partnership
By: RECKSON ASSOCIATES REALTY
CORP., its general partner
By: /s/ Michael Maturo
---------------------------
Name: Michael Maturo
Title: Chief Financial Officer and
Executive Vice President
COMPANY
-------
RECKSON AUSTRALIA OPERATING COMPANY
LLC, a Delaware limited liability company
By: RECKSON AUSTRALIA LPT CORPORATION,
a Maryland corporation
By: /s/ Michael Maturo
------------------------
Name: Michael Maturo
Title: Executive Vice President
REIT
----
RECKSON AUSTRALIA LPT CORPORATION,
a Maryland corporation
By: /s/ Michael Maturo
-------------------------
Name: Michael Maturo
Title: Executive Vice President
