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Below is a list of common sections included in Commercial Purchase Agreements. These sections are linked to the below sample agreement for you to explore.
PURCHASE AND SALE AGREEMENT
THIS PURCHASE AND SALE AGREEMENT (“ Agreement ”) is made as of the 18th day of May, 2007 (the “ Effective Date ”), by and between FSP ROYAL RIDGE CORP., a Delaware corporation (“ Seller ”) and KBS CAPITAL ADVISORS LLC, a Delaware limited liability company (“ Buyer ”). CHICAGO TITLE INSURANCE COMPANY (the “ Escrow Agent ”) joins in this Agreement for the limited purposes set forth in Section 15.
A. This Agreement is made with reference to the following real and personal property (collectively, the “ Property ”):
(1) All that land which is located in Fulton County, Georgia and described in Exhibit A hereto, together with all easements, rights and privileges appurtenant thereto (the “ Land ”);
(2) The office building (the “ Building ”), together with all other improvements, structures, fixtures and parking areas located on the Land and appurtenant thereto (the Building and such improvements, structures, fixtures and parking areas being hereinafter collectively referred to as the “ Improvements ,” and the Land and the Improvements being hereinafter collectively referred to as the “ Real Property ”);
(3) All of Seller’s interest as “landlord” under the tenant leases relating to the Improvements, and other occupancy agreements with tenants occupying or using all or any portion of the Real Property together with all amendments thereto (collectively, the “ Leases ”), and any guaranties applicable thereto and all security deposits, letters of credit, advance rental, or like payments held by Seller (collectively, the “ Security Deposits ”), if any, held by Seller in connection with the Leases, being the leases referred to on the list attached hereto as Exhibit B but not any subleases or licenses claiming by or through such Leases;
(4) All of Seller’s right, title and interest in all fixtures, equipment, furniture, furnishings, appliances, supplies and other personal property of every nature and description attached or pertaining to, or otherwise used in connection with, the Real Property, located within the Real Property but not any MRI accounting software or related items (the “ Personalty ”);
(5) All of Seller’s rights, title and interest, if any, in all intangible rights and property used or useful in connection with the foregoing but only if and to the extent assignable, including, without limitation, all development rights, contract rights, guarantees, licenses, plans, drawings, permits and warranties and in and to any service marks, logos or any trade names but not including any reference to “FSP” (the “ Intangible Property ”); and
(6) All of Seller’s interest in the service contracts (the “ Contracts ”) described on the attached Exhibit C , to the extent Buyer elects to assume the same in accordance with the provisions of Section 6.4 below.
B. Seller is prepared to sell, transfer and convey the Property to Buyer, and Buyer is prepared to purchase and accept the same from Seller, all for the Purchase Price (hereinafter defined) and on the other terms and conditions hereinafter set forth.
TERMS AND CONDITIONS
In consideration of the mutual covenants and agreements herein contained, and intending to be legally bound hereby, the parties hereto agree:
1. Sale and Purchase . Seller hereby agrees to sell, transfer and convey the Property to Buyer, and Buyer hereby agrees to purchase and accept the Property from Seller, in each case for the Purchase Price, and on and subject to the other terms and conditions set forth in this Agreement.
2. Purchase Price . The purchase price for the Property (the “ Purchase Price ”) shall be Thirty Three Million and 00/100 Dollars ($33,000,000.00) (subject to the adjustments and prorations provided for under this Agreement), which, subject to the terms and conditions hereinafter set forth, shall be paid to Seller by Buyer as follows:
2.1 Initial Deposit . Within three (3) business days following the Effective Date of this Agreement, Buyer shall deliver to Escrow Agent, in immediately available funds, to be held in escrow in a federally insured interest bearing account in the name of Buyer with a financial institution approved by Seller and Buyer, a cash deposit in the amount of Five Hundred Thousand and 00/100 Dollars ($500,000.00) (together with any interest earned thereon, the “ Initial Deposit ”) as security for the performance of Buyer’s obligations under this Agreement.
2.2 Additional Deposit . Unless Buyer terminates this Agreement during the Inspection Period (hereinafter defined) or this Agreement is deemed terminated, Buyer shall, within three (3) business days after the expiration of the Inspection Period, deliver to Escrow Agent, in immediately available funds, to be held in escrow in the same account as the Initial Deposit, an additional cash deposit in the amount of Five Hundred Thousand and 00/100 Dollars ($500,000.00) (together with any interest earned thereon, the “ Additional Deposit ”) as further security for the performance of Buyer’s obligations under this Agreement. The Initial Deposit and the Additional Deposit, after the Additional Deposit is delivered to Escrow Agent, are referred to herein as the “ Deposit .”
2.3 Failure to Make Deposit . Any failure of the Buyer to timely deliver the Initial Deposit or the Additional Deposit in accordance with the provisions of Sections 2.1 and 2.2 shall entitle Seller to terminate this Agreement at any time by giving written notice to Buyer at any time before the applicable Deposit is actually made. Time is of the essence with respect to the delivery of the Deposit.
2.4 Independent Contract Consideration . Seller and Buyer hereby acknowledge and agree that One Hundred and No/100 Dollars ($100.00) of the Deposit shall be deemed the amount that has been bargained for and agreed to as consideration for the Inspection Period.
2.5 Payment at Closing . At the consummation of the transaction contemplated hereby (the “ Closing ”), Buyer shall deliver to Escrow Agent cash in an amount equal to the Purchase Price less the Deposit. The Purchase Price, subject to adjustments and apportionments as set forth herein, shall be paid at Closing by wire transfer of immediately available funds, transferred to the order or account of Seller or such other person as Seller may designate in writing.
2.6 Closing Disbursements . The delivery and recording of documents and the disbursement of funds shall be effectuated through the Escrow Agent at the Closing and pursuant to the closing instructions from the parties hereto, which closing instructions shall not modify or diminish the parties’ respective obligations hereunder.
3. Representations and Warranties of Seller . Subject to (i) all matters disclosed in any of the Leases or Contracts described on Exhibit B and Exhibit C hereof, (ii) any information of which Buyer obtains actual knowledge, and (iii) any notification from Seller to Buyer that any representation is incorrect (all such matters being referred herein as “ Exception Matters ”), Seller represents and warrants to Buyer as follows:
3.1. Authority . Seller is a Delaware corporation duly formed and in good standing under the laws of the State of Delaware and is qualified to transact business in the State of Georgia and has all requisite power and authority to enter into this Agreement and perform its obligations hereunder. The execution and delivery of this Agreement have been duly authorized and constitutes the legal, valid and binding obligations of Seller.
3.2. No Conflict . The execution and delivery of this Agreement and the consummation of the transactions contemplated hereunder on the part of Seller do not and will not conflict with or result in the breach of any material terms or provisions of, or constitute a default under, or result in the creation or imposition of any lien, charge, or encumbrance upon any of the Property or assets of the Seller by reason of the terms of any contract, mortgage, lien, lease, agreement, indenture, instrument or judgment to which Seller is a party or which is or purports to be binding upon Seller or which otherwise affects Seller, which will not be discharged, assumed or released at Closing.
3.3. Leases . To Seller’s actual knowledge, there are no leases or occupancy agreements currently in effect which affect the Property other than those listed on Exhibit B . Seller further represents and warrants that, except as set forth in Exhibit B , to the best of Seller’s actual knowledge, Seller has paid all agents’ and brokers’ commissions and fees incurred in connection with the Leases executed prior to the date hereof (but excluding any such commissions or fees attributable to extension, renewal or expansion options under such Leases exercised after the date of Closing).
3.4. No Condemnation . To Seller’s actual knowledge, Seller has not received any written notice of any pending or contemplated condemnation, eminent domain or similar proceeding with respect to all or any portion of the Real Property, nor, to Seller’s actual knowledge, is any such proceeding threatened or contemplated of which Seller has not received formal notice.
3.5. Contracts . To Seller’s actual knowledge, there are no construction, management, leasing, service, equipment, supply, maintenance or concession agreements in effect with respect to the Real Property or the Personalty, except for the Contracts set forth in Exhibit C , and, except for the Contracts, if any, Buyer elects to assume pursuant to the provisions of Section 6.4 hereof, there shall not be any Contracts or contracts or agreements of any type pertaining to the Property, the obligation or liability for which Buyer or the Property could be liable after the Closing except as disclosed on Exhibit C .
3.6. Compliance . To Seller’s actual knowledge, Seller has not received written notice from any governmental agency or other body of any existing violations of any federal, state, county or municipal laws, ordinances, orders, codes, regulations or requirements affecting the Real Property which have not been cured.
3.7. Litigation . To Seller’s actual knowledge, there is no action, suit or proceeding in court or arbitration which is pending or threatened against or affecting the Property or arising out of the ownership, management or operation of the Real Property.
3.8. FIRPTA . Seller is not a “foreign person” as defined in Section 1445(f)(3) of the Internal Revenue Code.
3.9. No Bankruptcy . There are no creditors’ attachments or executions, general assignments in collection of debts for the benefit of creditors, or voluntary or involuntary proceedings in bankruptcy which are pending against Seller or, to the best of Seller’s actual knowledge, against any of the tenants.
3.10. No Other Options . To Seller’s actual knowledge, other than this Agreement, the Property is not subject to any outstanding agreement(s) of sale or options, rights of first refusal or other rights of purchase.
3.11. Property Documents . To Seller’s actual knowledge, Seller has provided or made available to Buyer all third party reports in Seller’s possession or control relating to the physical condition of the Property.
3.12. Limitations Regarding Seller’s Representations and Warranties . As used in this Agreement, or in any other agreement, document, certificate or instrument delivered by Seller to Buyer, the phrase “to Seller’s actual knowledge”, “to the best of Seller’s actual knowledge” or any similar phrase shall mean the actual, not constructive or imputed, knowledge of Leo H. Daley, Jr. in his capacity as Asset Manager and Vice President of FSP Property Management LLC, and not individually, without any obligation on such individual’s part to make any independent investigation of the matters being represented and warranted, or to make any inquiry of any other persons, or to search or examine any files, records, books, correspondence and the like. If Buyer becomes aware prior to the Closing that any representation or warranty hereunder is untrue, or any covenant or condition to Closing has not been fulfilled or satisfied (if not otherwise waived by Buyer), and Buyer nonetheless proceeds to close on the purchase of the Property, then Buyer shall be deemed to have irrevocably and absolutely waived, relinquished and released all rights and claims against Seller for any damage or loss arising out of or resulting from such untrue representation or warranty or such unfulfilled or unsatisfied covenant or condition. If Buyer discovers that any of these representations and warranties are inaccurate in
any material respect prior to the Closing, Buyer’s sole and exclusive remedy, waiving all other remedies, shall be either to (i) terminate this Agreement by giving notice to Seller prior to the Date of Closing or (ii) waive such representation and warranty in its entirety and proceed to the Closing. If Buyer terminates this Agreement under this Section 3.12, the Deposit shall be returned to Buyer and the parties shall have no further rights, liabilities or obligations under this Agreement. If Buyer does not discover that any express representation or warranty set forth in this Section 3.12 has been breached by Seller until after Closing, Buyer shall have the right to pursue Seller for damages, subject, however to the limitation on the liability of Seller set forth in this Agreement.
4. Conditions Precedent to Buyer’s Obligations . All of Buyer’s obligations hereunder are expressly conditioned on the satisfaction at or before the time of Closing hereunder, or at or before such earlier time as may be expressly stated below, of each of the following conditions (any one or more of which may be waived in writing in whole or in part by Buyer, at Buyer’s option):
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4.2. Accuracy of Representations . All of the representations and warranties of Seller contained in this Agreement shall have been true and correct (without qualification with regard to Exception Matters) in all material respects when made, and shall be true and correct (without qualification with regard to Exception Matters) in all material respects on the date of Closing with the same effect as if made on and as of such date.
4.3. Performance . Seller shall have performed, observed and complied with all material covenants, agreements and conditions required by this Agreement to be performed, observed and complied with on its part prior to or as of Closing hereunder.
4.4. Documents and Deliveries . All instruments and documents required on Seller’s part to effectuate this Agreement and the transactions contemplated hereby shall be delivered to Buyer and/or Escrow Agent and shall be in form and substance consistent with the requirements herein.
4.5. No Material Changes . As of the Closing Date, there shall have been no material adverse changes since the expiration of the Inspection Period in the physical condition of the Property or the operating condition of any building systems or equipment serving the Property.
4.6. Inspection Period; Access; Purchase “As Is” .
4.6.1. To the extent in the Seller’s possession, Seller has previously delivered, or on the Effective Date shall deliver to Buyer, or make available to Buyer at the offices of the Seller or its property management company, all of the following to the extent in Seller’s possession or control (such items collectively hereafter referred to as the “ Property Materials ”): (1) the Leases, files, including landlord and tenant correspondence and all pending leases, lease proposals and letters of intent under negotiation between landlord and prospective
tenants; (2) the Contracts; (3) all existing title materials and surveys relating to the Property; (4) real estate tax bills for the Property for the current and previous three (3) years; (5) all existing soils reports, engineering reports and environmental reports relating to the Property; (6) utility bills for the Property for the last twelve (12) months preceding the date hereof; (7) 2004, 2005, and 2006 year-end operating statements and 2007 year-to-date operating statements; (8) current rent rolls and all information relating to rent steps, CPI increases and base year expense stops (the “ Rent Roll ”); (9) current aging and delinquency reports, if any, and other income and rental concessions regarding the operations of the Property; (10) copies of any and all notices from governmental authorities or insurance carriers asserting noncompliance with zoning, environmental or other laws, or any insurance requirements regarding the ownership, development, construction, leasing, management or operation of the Property; (11) copies of all insurance policies relating to the Property (other than title insurance policies) or evidence of insurance coverage; (12) copies of all documents regarding litigation, liens or threatened claims; (13) copies of all permits, guarantees, licenses, plans, drawings and any certificates of occupancy with respect to the ownership, construction, use, possession and/or development of the Property; and (14) a list of all personal property existing owned or leased by Seller. Notwithstanding the foregoing, Seller shall not be required to provide any materials which are confidential, privileged or proprietary in nature, such as (but not limited to) internal memoranda and analyses, appraisals, financial projections, client and investor correspondence and other similar materials (the “ Proprietary Materials ”). Buyer hereby acknowledges and agrees that (a) Seller has not independently verified the accuracy of completeness of any of the Property Materials, (b) except as expressly provided in this Agreement, Seller makes no representation or warranty, express or implied, as to the accuracy or completeness of the Property Materials, and (c) except as expressly provided in this Agreement, Seller shall have no liability to Buyer as a result of any inaccuracy or incompleteness of any of the Property Materials. In the event that the Closing does not occur in accordance with the terms of this Agreement, Buyer shall return to Seller all of the documents, material or information regarding the Property supplied to Buyer by Seller, together with any additional documents, material or information regarding the Property, regardless of whether supplied by Seller, that Seller requests in writing from Buyer, provided that Seller is not in default under this Agreement, but subject to any confidentiality provisions set forth therein and with no representations as to the accuracy thereof.
4.6.2. During the period this Agreement is in effect and for sixty (60) days after the Closing Date, Buyer may, at its sole cost and expense, cause an independent accounting firm to prepare and deliver to Buyer (and Seller if requested by Seller in writing) an audit of the historical statement of revenues and direct operating expenses of the Property (the “ Audit ”) for the calendar years 2003, 2004, 2005, 2006 and 2007 (through the Closing Date). In connection with the Audit, Seller acknowledges and agrees that (i) the Audit may be included in any filing or filings, as the case may be, that Buyer (or any affiliate of Buyer) is required to file with the Securities and Exchange Commission, (ii) it will reasonably cooperate with Buyer and its independent accounting firm and (iii) if requested by Buyer in writing, it will consent to the retention of Seller’s independent accounting firm by Buyer (or any affiliate of Buyer) to prepare and deliver the Audit. The provisions of this Section 4.6.2 shall survive the Closing.
4.6.3. Buyer, its agents and representatives, shall be entitled to enter upon the Real Property from time to time (as coordinated through Seller’s property manager), including all leased areas, upon reasonable prior notice to Seller, to perform inspections and tests
of the Property, including surveys, environmental studies, examinations and tests of all structural and mechanical systems within the Improvements, and to examine the books and records of Seller and Seller’s property manager relating to the Property. Before entering upon the Property, Buyer shall furnish to Seller evidence of general liability insurance coverage in such amounts and insuring against such risks as Seller may reasonably require.
Notwithstanding the foregoing, Buyer shall not be permitted to interfere unreasonably with Seller’s operations at the Property or interfere with any tenant’s rights under its lease, and the scheduling of any inspections shall take into account the timing and availability of access to tenants’ premises, subject to tenants’ rights under the Leases or otherwise. If Buyer wishes to engage in any testing which is invasive, which will damage or disturb any portion of the Property, including performance of a Phase Two environmental assessment, which will involve sampling, or which will involve testing of subsurface soils or groundwater, Buyer shall obtain Seller’s prior consent thereto, which may be withheld by Seller in its sole and absolute subjective discretion. Buyer shall repair any damage to the Property caused by any such tests or investigations, and indemnify Seller from any and all liabilities, claims, costs and expenses resulting therefrom, except to the extent caused by the gross negligence or willful misconduct of Seller and provided, that notwithstanding anything to the contrary in this Section, such indemnification shall not apply to Buyer’s discovery of existing conditions at the Property. The foregoing indemnification shall survive Closing or the termination of this Agreement. As part of Buyer’s due diligence inspections, (a) Seller shall make available to Buyer for interviews regarding the Property, Seller’s personnel, agents and managers, provided Buyer acknowledges that such persons do not have the right to make representations or make commitments on behalf of Seller and (b) Buyer shall have the right to interview the tenants leasing space at the Property provided Buyer provides Seller with advance notice of such interviews. At Seller’s option, Seller may be present for any tenant interviews, including all phone interviews.
4.6.4. The term “ Inspection Period ,” as used herein, shall mean the period ending at 5:00 p.m. Eastern Time Zone (U.S.A.) on June 6, 2007. If any date on which the expiration of the Inspection Period would occur by operation of this Agreement is either a weekend day or a federal or state holiday, the expiration of the Inspection Period shall occur at 5:00 p.m. Eastern Time Zone (U.S.A.) on the next business day. During the Inspection Period, Buyer shall determine, in its sole and absolute discretion, whether the Property and all matters pertaining to the Property are satisfactory for Buyer’s purchase of the Property and all matters pertaining to the Property are satisfactory for Buyer’s purchase of the Property, which determination of satisfaction shall be deemed given only by delivering to Seller and Escrow Agent written notices of approval (“ Property Approval Notice ”). If Buyer does not deliver the Property Approval Notice to Seller prior to the expiration of the Inspection Period, or elects prior to the expiration of the Inspection Period to terminate this Agreement in its sole discretion by giving written notice of such election to Seller, the Deposit (including any earned interest) shall be immediately returned to Buyer. If requested by Seller in writing, Buyer shall deliver to Seller copies of all surveys, title commitments, engineering reports, environmental audits and other third party studies and reports generated by or for Buyer in connection with the Property, and, except as expressly set forth herein, neither party shall have any further liability or obligation to the other hereunder.
4.6.5. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT AND IN THE DOCUMENTS EXECUTED IN CONNECTION WITH THE CLOSING, IT IS UNDERSTOOD AND AGREED THAT SELLER IS NOT MAKING AND HAS NOT AT ANY TIME MADE ANY WARRANTIES OR REPRESENTATIONS OF ANY KIND OR CHARACTER, EXPRESS OR IMPLIED, WITH RESPECT TO THE PROPERTY, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTIES OR REPRESENTATIONS AS TO HABITABILITY, MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
BUYER ACKNOWLEDGES AND AGREES THAT UPON CLOSING SELLER SHALL SELL AND CONVEY TO BUYER AND BUYER SHALL ACCEPT THE PROPERTY “ AS IS, WHERE IS, WITH ALL FAULTS ”, EXCEPT TO THE EXTENT EXPRESSLY PROVIDED OTHERWISE IN THIS AGREEMENT. BUYER HAS NOT RELIED AND WILL NOT RELY ON, AND SELLER IS NOT LIABLE FOR OR BOUND BY, ANY EXPRESS OR IMPLIED WARRANTIES, GUARANTIES, STATEMENTS, REPRESENTATIONS OR INFORMATION PERTAINING TO THE PROPERTY OR RELATING THERETO (INCLUDING SPECIFICALLY, WITHOUT LIMITATION, ANY PROSPECTUS DISTRIBUTED WITH RESPECT TO THE PROPERTY) MADE OR FURNISHED BY SELLER, THE MANAGERS OF THE PROPERTY, OR ANY REAL ESTATE BROKER OR AGENT REPRESENTING OR PURPORTING TO REPRESENT SELLER, TO WHOMEVER MADE OR GIVEN, DIRECTLY OR INDIRECTLY, ORALLY OR IN WRITING, UNLESS SPECIFICALLY SET FORTH IN THIS AGREEMENT OR IN THE DOCUMENTS EXECUTED IN CONNECTION WITH THE CLOSING. BUYER ALSO ACKNOWLEDGES THAT THE PURCHASE PRICE REFLECTS AND TAKES INTO ACCOUNT THAT THE PROPERTY IS BEING SOLD “AS-IS.”
BUYER REPRESENTS TO SELLER THAT BUYER HAS CONDUCTED, OR WILL CONDUCT PRIOR TO CLOSING, SUCH INVESTIGATIONS OF THE PROPERTY, INCLUDING BUT NOT LIMITED TO, THE PHYSICAL AND ENVIRONMENTAL CONDITIONS THEREOF, AS BUYER DEEMS NECESSARY OR DESIRABLE TO SATISFY ITSELF AS TO THE CONDITION OF THE PROPERTY AND THE EXISTENCE OR NONEXISTENCE OR CURATIVE ACTION TO BE TAKEN WITH RESPECT TO ANY HAZARDOUS OR TOXIC SUBSTANCES ON OR DISCHARGED FROM THE PROPERTY, AND WILL RELY SOLELY UPON SAME AND NOT UPON ANY INFORMATION PROVIDED BY OR ON BEHALF OF SELLER OR ITS AGENTS OR EMPLOYEES WITH RESPECT THERETO. UPON CLOSING, BUYER SHALL ASSUME THE RISK THAT ADVERSE MATTERS, INCLUDING BUT NOT LIMITED TO, CONSTRUCTION DEFECTS AND ADVERSE PHYSICAL AND ENVIRONMENTAL CONDITIONS, MAY NOT HAVE BEEN REVEALED BY BUYER’S INVESTIGATIONS, AND, SUBJECT TO BUYER’S RIGHTS UNDER SECTION 10.2, BUYER, UPON CLOSING, SHALL BE DEEMED TO HAVE WAIVED, RELINQUISHED AND RELEASED SELLER (AND SELLER’S OFFICERS, DIRECTORS, SHAREHOLDERS, EMPLOYEES AND AGENTS) FROM AND AGAINST ANY AND ALL CLAIMS, DEMANDS, CAUSES OF ACTION (INCLUDING CAUSES OF ACTION IN TORT), LOSSES, DAMAGES, LIABILITIES, COSTS AND EXPENSES (INCLUDING REASONABLE ATTORNEYS’ FEES) OF ANY AND EVERY KIND OR CHARACTER, KNOWN OR UNKNOWN , WHICH BUYER MIGHT HAVE ASSERTED OR ALLEGED AGAINST SELLER (AND SELLER’S
OFFICERS, DIRECTORS, SHAREHOLDERS, EMPLOYEES AND AGENTS) AT ANY TIME BY REASON OF OR ARISING OUT OF ANY LATENT OR PATENT CONSTRUCTION DEFECTS OR PHYSICAL CONDITIONS, VIOLATIONS OF ANY APPLICABLE LAWS AND ANY AND ALL OTHER ACTS, OMISSIONS, EVENTS, CIRCUMSTANCES OR MATTERS REGARDING THE PROPERTY.
THE PROVISIONS OF THIS SECTION SHALL SURVIVE CLOSING OR ANY TERMINATION OF THIS AGREEMENT.
NOTWITHSTANDING ANY PROVISION HEREOF TO THE CONTRARY, THE PROVISIONS OF THIS SECTION 4.7.3 SHALL NOT APPLY TO, AND BUYER DOES NOT RELEASE SELLER FROM, (A) ANY DAMAGES, CLAIMS, LIABILITIES OR OBLIGATIONS ARISING OUT OF OR IN CONNECTION WITH A BREACH OF ANY COVENANT, REPRESENTATION OR WARRANTY OF SELLER SET FORTH IN THIS AGREEMENT OR ANY OF THE DOCUMENTS EXECUTED IN CONNECTION WITH THIS AGREEMENT, (B) SELLER’S FRAUD, OR (C) EXCEPT AS PROVIDED IN SECTION 4.7.4 BELOW, ANY CLAIMS OR ACTIONS BUYER MAY HAVE AGAINST SELLER THAT MAY ARISE FROM THIRD-PARTY CLAIMS ASSERTED AGAINST BUYER WITH RESPECT TO ACTIONS OR OCCURRENCES ARISING PRIOR TO CLOSING.
4.6.6. Buyer hereby agrees that, if at any time after the Closing, any third party or any governmental agency seeks to hold Buyer responsible for the presence of, or any loss, cost or damage associated with, Hazardous Materials (as defined below) in, on, above or beneath the Real Property or emanating therefrom, then the Buyer waives any rights it may have against Seller, except as otherwise expressly set forth in this Agreement, in connection therewith including, without limitation, under CERCLA (as defined below), and Buyer agrees that it shall not (i) implead the Seller, (ii) bring a contribution action or similar action against the Seller or (iii) attempt in any way to hold the Seller responsible with respect to any such matter. The provisions of this Section 4.7.4 shall survive the Closing. As used herein, “ Hazardous Materials ” shall mean and include, but shall not be limited to any petroleum product and all hazardous or toxic substances, wastes or substances, any substances which because of their quantities concentration, chemical, or active, flammable, explosive, infectious or other characteristics, constitute or may reasonably be expected to constitute or contribute to a danger or hazard to public health, safety or welfare or to the environment, including, without limitation, any hazardous or toxic waste or substances which are included under or regulated (whether now exiting or hereafter enacted or promulgated, as they may be amended from time to time) including, without limitation, the Comprehensive and Liability Act of 1980, 42 U.S.C. Section 9601 et seq . (“ CERCLA ”), the Federal Resource Conservation and Recovery Act, 42 U.S.C. Section 6901 et seq ., similar state laws and regulations adopted thereunder.
4.7. Title and Survey Matters . As soon as possible after the Effective Date, Buyer shall, at Buyer’s sole cost and expense, obtain a title report or commitment (the “ Title Commitment ”) issued by Chicago Title Insurance Company (the “ Title Company ”) with respect to the Property (with copies of all instruments listed as exceptions to title) and Buyer shall provide or cause the Title Company to provide to Seller a copy of the Title Commitment and such instruments. In accordance with Section 4.6.1 above, Seller shall furnish to Buyer a copy of
Seller’s most recent existing survey of the Property. Buyer may elect, at Buyer’s sole cost and expense (subject to Section 8.2), to obtain an updated survey of the Property. Buyer shall have until the expiration of the Inspection Period to approve or disapprove matters disclosed thereby and to give written notice to Seller of any disapproval thereof, indicating in reasonable detail the nature and reasons for Buyer’s objection; and failure to give such notice of disapproval shall constitute Buyer’s approval of all such matters. In the event Buyer so notifies Seller of Buyer’s disapproval of the Title Commitment or survey matters, Seller may elect (but shall have no obligation whatsoever) to attempt to cure any disapproved matter within thirty (30) days from receipt of such notice (the “ Title Cure Period ”), in which event the Closing, if it otherwise is scheduled to occur earlier, shall be extended until the earlier of thirty (30) days after receipt of such notice or five (5) business days after such matter is cured. Within five (5) business days after receiving Buyer’s notice (the “ Seller’s Title Notice Period ”), Seller shall notify Buyer if Seller intends to attempt to effectuate such cure; provided that Seller shall be obligated to remove, pay and/or satisfy prior at Closing any liens against the Property granted or caused by Seller. Notwithstanding the foregoing, Seller shall not be obligated to satisfy at closing any liens against the Property for a liquidated amount that are in excess of $50,000 other than a mortgage or other security agreement on the Property which shall be paid in full from the proceeds of the sale unless, with the consent of Buyer, the mortgage is assumed or transferred to Buyer. In the event that, prior to the expiration of the Seller’s Title Notice Period, Seller fails to give such notice of its intention to attempt to effectuate such cure, Buyer may, within five (5) business days after the expiration of the Seller’s Title Notice Period, terminate this Agreement by notice to Seller in which event the Deposit shall be returned to Buyer, provided if Buyer does not so terminate this Agreement within five (5) business days after the expiration of the Seller’s Title Notice Period, Buyer shall be deemed to have waived objection to any such Title Commitment or survey matters and agreed to accept title subject thereto, without reduction in the Purchase Price. In the event Seller gives such notice of its intention to attempt to effectuate such cure and thereafter fails to actually effectuate such cure (in a manner reasonably acceptable to Buyer) within the Title Cure Period, Buyer’s sole rights with respect thereto shall be to terminate this Agreement prior to Closing, in which event the Deposit shall be returned to Buyer; provided if Buyer does not so terminate this Agreement prior to Closing, Buyer shall be deemed to have waived objection to any such Title Commitment or survey matters and agreed to accept title subject thereto, without reduction in the Purchase Price. Notwithstanding anything to the contrary contained in this Agreement, Buyer disapproves all monetary and financing liens and encumbrances other than liens for non-delinquent real property taxes (“ Disapproved Liens ”). All matters disclosed in the Title Commitment and the survey (excluding Disapproved Liens and any exception for mechanics’ liens) and not cured or removed as of the expiration of the Title Cure Period shall constitute “ Permitted Exceptions ”.
4.8. Tenant Estoppel Certificates . The obligation of Buyer to close the transaction contemplated hereby is subject to Buyer’s receipt of estoppel certificates in the form of Exhibit D attached hereto (an “ Estoppel Certificate ”), dated no more than thirty (30) calendar days prior to the Closing Date, from Virginia Surety Company, Inc. and Hagemeyer North America, Inc. (the “ Estoppel Certificate Requirement ”). Seller shall request, and shall use commercially reasonable efforts to obtain the executed Estoppel Certificates prior to the expiration of the Inspection Period, from each of the tenants at the Property, and promptly deliver to Buyer to the extent received. In addition, Seller shall use commercially reasonable efforts to obtain an Estoppel Certificate from Axis Reinsurance Company (“ Axis ”) but Buyer
acknowledges that Seller has no direct contractual relationship with Axis and no right to require Axis to provide an Estoppel Certificate. Seller agrees to deliver Estoppel Certificates to each tenant and Axis within two business days after the date Buyer approves in writing the completed form of Estoppel Certificate for such tenant or Axis, as the case may be. An Estoppel Certificate shall be deemed to satisfy the Estoppel Certificate Requirement notwithstanding the respective tenant’s qualifying any statement or certification therein by a “best of knowledge” standard or similar provision, and shall be deemed not to satisfy the Estoppel Certificate Requirement if such Estoppel Certificate discloses the existence of any default under the Lease referenced therein and contains information that materially varies from (i) the terms of the Lease, (ii) the information contained in the Rent Roll or (iii) the information contained in the accounts receivable aging report for the Property provided to Buyer.
5. Failure of Conditions . In the event Seller shall not be able to convey title to the Property on the date of Closing in accordance with the provisions of this Agreement and to satisfy all conditions precedent to Closing set forth in Article 4 above, and Buyer has performed and is not in breach or default hereunder, then Buyer shall have the option, exercisable by written notice to Seller at or prior to Closing, of (1) accepting at Closing such title as Seller is able to convey and/or waiving any unsatisfied condition precedent, with no deduction from or adjustment of the Purchase Price, or (2) declining to proceed to Closing. In the latter event, except as expressly set forth herein, all obligations, liabilities and rights of the parties under this Agreement shall terminate, and the Deposit (together with interest thereon) shall be returned to Buyer.
6. Pre-Closing Matters .