UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) November 30, 2004
ONE LIBERTY PROPERTIES, INC.
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(Exact name of Registrant as specified in charter)
Maryland 001-09279 13-3147497
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(State or other (Commission file No.) (IRS Employer
jurisdiction of I.D. No.)
incorporation)
60 Cutter Mill Road, Suite 303, Great Neck, New York 11021
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(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code 516-466-3100
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Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 2.01. Completion of Acquisition or Disposition of Assets
On November 30, 2004 the registrant acquired in an arms length transaction,
through a wholly owned limited liability company, a 63,897 square foot, single
story, retail building located in Onalaska, Wisconsin, a suburb of LaCrosse,
Wisconsin. The building is situated on a 4.74 acre parcel of real property. The
property was acquired for $943,265 cash above an existing $2,768,865 first
mortgage, a total purchase price of $3,712,130.
The property is net leased to Hob-Lob Limited Partnership, pursuant to a lease
which expires on December 31, 2014. The lease contains two five year options.
The landlord is obligated to make structural repairs and replacements and all
building systems repairs, including roof and structure. The tenant is
responsible for all other costs. The initial annual base rent is $367,534
increasing effective January 1, 2005 to $399,493. The annual base rent increases
every five years thereafter through 2014.
Item 9.01 Financial Statements and Exhibits
(a) Financial Statements of Businesses Acquired. If the financial
statements specified by Rule 3-14 of Regulation S-X are
required, said financial statements shall be filed not later
than February 9, 2005, 71 calendar days after the date that
this report on Form 8K was required to be filed.
(b) Proforma Financial Information. Not Applicable.
(c) Exhibits.
Contract of Sale Dated August (no date) 2004 between LaCrosse
Partners Ltd., and OLP Onalaska, LLC.
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ONE LIBERTY PROPERTIES, INC.
Date: December 6, 2004 By: /s/ Simeon Brinberg
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Simeon Brinberg
Senior Vice President
CONTRACT OF SALE
This CONTRACT OF SALE (this "Contract of Sale") is made and entered into as
of the day of August, 2004 by and between LACROSSE PARTNERS, Ltd., a
Pennsylvania limited partnership having an address at c/o CC Realty Advisors,
Inc., 3637 Washington Road, Suite 3, McMurray, PA 15317 ("Seller"), and OLP
Onalaska LLC, a Wisconsin limited liability company having an office at 60
Cutter Mill Road, Suite 303, Great Neck, New York 11021 ("Purchaser").
WITNESSETH:
WHEREAS, Seller is the current owner of the approximately 4.74 acre parcel of
property and the improvements thereon known as and by 9408 State Road 16,
Onalaska, Wisconsin and more particularly described on Exhibit A attached hereto
(the "Premises"); and
WHEREAS, Seller wishes to sell and Purchaser wishes to acquire the Premises in
accordance with the terms hereof.
NOW, THEREFORE, in consideration of the mutual covenants herein contained, the
sufficiency of which being hereby acknowledged, the parties hereto do hereby
agree as follows:
1. Purchase Price. Seller agrees to sell and Purchaser agrees to buy the
Premises for a total purchase price equal to $943,265.00 (the "Cash Portion")
plus the unpaid principal balance of the Mortgage (hereafter defined) as of the
Closing Date (together with the Cash Portion, the "Purchase Price"). At Closing,
Buyer shall pay the Purchase Price by paying the Cash Portion (less the
Downpayment) by wire transfer to an account designated by Seller and assuming,
from and after Closing and on a non-recourse basis, Seller's obligations under
the Loan, all as more particularly hereinafter set forth. Upon the execution and
delivery of this Contract, Purchaser shall deposit $100,000 as the Downpayment
(hereafter defined) by check made payable to the order of Escrow Agent
(hereafter defined), which sum shall be held in escrow pursuant to the terms
hereof.
2: Escrow. Concurrently with the execution of this Contract, Purchaser has
delivered to First American Title Insurance Company, as escrow agent ("Escrow
Agent"), a check(s) (subject to collection) in the amount of $100,000 as the
downpayment (the "Downpayment"). Escrow Agent shall deposit the Downpayment into
an interest-bearing account(s) maintained at a federally insured financial
institution(s). Escrow Agent shall deliver the Downpayment in accordance with
this Contract, or a joint instruction signed by Seller and Purchaser, or
separate instructions of like tenor signed by Seller and Purchaser, or a final
non-appealable judgment of a court of competent jurisdiction. Escrow Agent at
any time may deposit the Downpayment with a court of competent jurisdiction, and
upon notice to Seller and Purchaser of such deposit, Escrow Agent shall have no
further responsibility or liability hereunder. If Escrow Agent shall receive a
written request by one party for the release of the escrow, Escrow Agent will
give a copy thereof to the other party. If Escrow Agent shall not receive an
objection from the other party within five (5) business days, then Escrow Agent
shall so release the Downpayment. If Escrow Agent receives an objection, then
Escrow Agent shall continue to hold the Downpayment in accordance with the terms
hereof. Escrow Agent may act upon any instruction or other writing believed by
Escrow Agent in good faith to be genuine and to be signed or presented by the
proper persons. Any interest or income on the Downpayment shall be paid to
Purchaser or credited to Purchaser at Closing except in the event of the default
of Purchaser entitling Seller to the Downpayment in which event Seller shall be
entitled to the interest.
Seller and Purchaser acknowledge that Escrow Agent is merely a stakeholder, and
that Escrow Agent shall not be liable for any act or omission unless taken or
suffered in bad faith, in willful disregard of this Contract or involving gross
negligence. Escrow Agent shall not be liable for the failure of a qualifying
institution(s) in which the Downpayment has been deposited. Seller and Purchaser
agree to indemnify and hold Escrow Agent harmless from and against any,
reasonable costs, claims or expenses incurred in connection with the performance
of the Escrow Agent's duties hereunder, unless such costs, claims or expenses
were occasioned by Escrow Agent's bad faith or its willful disregard of this
Contract. Escrow Agent shall not be bound by any agreement between Seller and
Purchaser, whether or not Escrow Agent has knowledge thereof, and Escrow Agent's
only duties and responsibilities shall be to hold, and to dispose of, the
Downpayment and interest earned thereon in accordance with this Contract. Escrow
Agent may consult with counsel, and any opinion of counsel shall be full and
complete authorization and protection in respect of any action taken or omitted
by Escrow Agent hereunder in good faith and in reliance upon such opinion.
All instructions or notices given to the Escrow Agent shall be in writing and
delivered in accordance with the requirements of this Contract. For purposes of
this paragraph, such instructions and notices shall be deemed delivered on the
date of delivery, if by hand, or on the date of mailing if mailed, except that
no instruction or notice to Escrow Agent shall be deemed effectively delivered
to Escrow Agent until actual receipt thereof by Escrow Agent.
3. Successors and Assigns. A. This Contract shall not be binding until
executed and delivered by Seller and Purchaser. Once fully executed and
delivered, this Contract shall be binding upon and inure to the benefit
of the parties hereto and their respective heirs, executors,
administrators, successors and permitted assigns.
B. Purchaser will not, without the prior written consent of Seller, sell,
assign or transfer its interest in this Contract. Notwithstanding the
foregoing, Purchaser shall be permitted without the necessity of
obtaining the approval of Seller to assign this Contract to a
corporation, partnership or other entity which is owned or controlled
by (or under common control with) Purchaser. Seller shall not assign
its obligations hereunder nor sell the Premises during the term of this
Contract.
4. Seller's Representations. Seller represents and warrants to Purchaser
that:
A. the Premises has been improved by the completion of a no less than
64,220 useable square foot retail facility for use as a retail store
for Hobby Lobby Stores, Inc., an Oklahoma corporation (the "Tenant");
B. (i) there is no litigation or arbitration pending (including a
bankruptcy or similar proceeding) against Seller or, to the best of
Seller's knowledge, threatened by or against Seller, the Tenant or the
Premises and in any manner relating to the Premises or the Lease
(collectively, "Litigation") and (ii) neither Seller nor any of its
agents, representatives or employees has received any notice from any
governmental agency or office or any nearby property owner or tenant of
the Premises' violation or potential violation of applicable law (a
"Violation"). Seller agrees to promptly notify Purchaser of any notice
that it or its agents, representatives or employees may receive on or
after the date hereof of a Violation or Litigation;
C. Seller has not received a notice or request from any insurance company
or Board of Fire Underwriters (or other organization exercising
functions similar thereto) requesting the performance of any work or
alteration in respect of the Premises. If Seller receives a notice or
request (a "Notice") from any insurance company or Board of Fire
Underwriters (or other organization exercising functions similar
thereto) requesting the performance of any work or alteration in
respect of the Premises prior to the Closing Date, Seller agrees to
promptly send same to Purchaser. If any Violation, Litigation or Notice
is not cured by Seller prior to Closing then Purchaser's right shall be
to either close on this Contract without abatement in the purchase
price or terminate this Contract and receive back its Downpayment, in
which event the parties shall have no further obligation to the other.
D. Seller has no employees at the Premises or any other employees that
Purchaser would be responsible for upon its acquisition of the
Premises.
E. Seller has no service contracts, maintenance agreements, landscaping
contracts, security service contracts or any other agreements relating
to the Premises which will survive Closing or which will be binding
upon Purchaser in any way after the Closing, except for obligations
under recorded reciprocal easement and shopping center maintenance
agreements with the developer of the shopping center of which the
Premises is a part (with it being understood, however that the Tenant
is responsible for compliance with same pursuant to the Lease), all of
which agreements shall be dealt with as title matters pursuant to
Paragraph % hereof,
F. the Premises constitutes its own tax parcel and, to Seller's actual
knowledge, all real property, personality, transfer or other taxes in
respect of the Premises (the non-payment of which could cause a lien to
be placed upon the Premises) have been paid through the date hereof and
will be paid through the Closing Date.
G. The warranties and representations set forth in this Paragraph 4 shall
survive the Closing and shall continue in effect for one (1) year
following the Closing Date. Seller shall recertify the warranties and
representations contained in this Paragraph 4 and in Paragraph 6 below
as of the Closing Date in an instrument to be delivered at the Closing
(the "Seller's Certificate").
5. Inspections. A. At Purchaser's cost and expense, Purchaser and its
advisors shall be permitted to inspect the Premises for its design
features, its location, its proximity to major thoroughfares, its
access, its visibility, the demographics of the surrounding areas, its
compliance with applicable laws, its compliance with the Plans and
Specifications, other construction or building issues and such other
matters as are deemed relevant to Purchaser (the "Inspection") and also
to perform a phase I environmental audit of the Premises (the "Phase
I") and if recommended by Purchaser's environmental consultant a phase
II environmental audit of the Premises (the "Phase II"). Purchaser
agrees to indemnify and hold harmless Seller from any damage to person
or property that may be caused by the Inspection, the Phase I or the
Phase II and shall repair any and all damage occasioned by the
Inspection, the Phase I or the Phase II. The Inspection, the Phase I
and the Phase II shall be conducted in such a manner so as to not
unreasonably interfere with the Tenant's operation from the Premises
nor cause a violation of any term or condition of the Lease.
B. Purchaser shall have through the expiration of the Due Diligence Period
(hereafter defined) to notify Seller that Purchaser is satisfied with
the results of the Inspection, the Phase I or the Phase II. In the
event Purchaser shall fail to timely notify Seller of its satisfaction
or in the event Purchaser shall notify Seller that it is dissatisfied
with the Premises, then in either such case this Contract shall
terminate and the Downpayment with interest thereon shall be returned
to Purchaser and the parties shall have no other liability to each
other.
C. Seller agrees to cooperate with Purchaser in connection with the
inspections referenced above and to provide access to the Premises in
connection therewith. Seller also agrees to cooperate with Purchaser in
having any of Seller's existing inspection reports (e.g., its current
environmental report) redated and certified in favor of Purchaser and
its lender. Seller further agrees to provide to Purchaser within five
(5) days of the execution hereof the following:
I. A copy of the Lease and all relevant correspondence and all amendments,
2. A copy of the final certificate of occupancy for the Premises, together
with all other necessary or appropriate approvals or certifications to
the extent such approvals or certifications are in Seller's possession,
3. A copy of Seller's most recent as-built survey for the Premises,
4. A copy of all materials in Seller's possession concerning the zoning
and other building requirements of the Premises;
5. A copy of all phase I environmental audits and any updates or other
environmental information in its possession relating to the Premises
(including a phase II environmental audit, if applicable); Seller also
agrees to provide to Purchaser a copy of any additional environmental
information Seller may receive following its execution of this
Contract,
6. To the extent in Seller's possession, a copy of a structural inspection
report, geotechnical report and/or appraisal of the Premises, and
7. A copy of the Mortgage and all related financing documents including,
without limitation, the promissory note secured thereby.
The Due Diligence Period shall expire on the date that is thirty (30) days
following the Purchaser's receipt of a fully executed counterpart of this
Contract.
D. Seller further agrees to cooperate in having all structural inspections,
architect certifications, engineer's reports and other similar items certified
in favor of Purchaser and its lender and Seller shall promptly give a copy of
such items to Purchaser upon Seller's receipt thereof, provided same shall be at
the sole cost and expense of Purchaser.
6. Environment. Seller warrants and represents that, to the best of its
knowledge, in respect of the Premises and all adjoining properties, and except
as set forth in any environmental audits delivered by Seller to Purchaser, there
has been, except as may be permitted by applicable environmental laws and
regulations, no (i) generation, storage, treatment or disposal of Hazardous
Wastes (hereafter defined), (ii) use of the Premises as a landfill or site for
the storage of Hazardous Wastes, or as a site for the discharge into the
environment of Hazardous Wastes, (iii) disposal off site from the Premises of
any Hazardous Wastes, (iv) federal, state or local government investigation or
inquiry regarding the environmental condition of the Premises or any surrounding
properties, (v) claim made against Seller for injury to person or property
relating to the environmental condition of the Premises or (vi) notices of
violation of applicable law relating to the protection of the environment served
on or otherwise received by Seller. The representations and warranties contained
in this Paragraph shall survive the Closing for a period of one (1) year. Seller
shall recertify the warranties and representations in this Paragraph 6 as of the
Closing Date in the Seller's Certificate. For purposes hereof, "Hazardous
Wastes" shall mean and refer to explosives, radioactive materials, asbestos,
asbestos-containing materials, polychlorinated biphenyls, lead, lead-based
paint, radon, under and/or above ground storage tanks, hazardous materials,
toxic substances, hazardous wastes, hazardous substances, mold, petroleum,
petroleum based materials or any other materials or substances which are listed
or regulated in the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended (42 U.S.C. Sections 6901, et seq.), the
Resources Conservation and Recovery Act of 1976 (42 U.S.C. Section 6901, et m
q.), the Clean Water Act (33 U.S.C. Section 1251, et seg.), the Safe Drinking
Water Act (14 U.S.C. Section 1401, et s. emC .), the Hazardous Materials
Transportation Act (49 U.S.C. Section 1801, et seg.), the Toxic Substance
Control Act (15 U.S.C. Section 2601, et sea), or any other applicable federal,
state or local laws.
7. Brokers. Purchaser and Seller each warrants and represents to the other that
except for Friedman Real Estate ("Broker"): (i) it has not dealt with any broker
in respect of the Premises and (ii) no broker has brought the Premises to the
attention of the Purchaser or was otherwise involved in the Purchaser's interest
in the Premises. Each party shall indemnify, defend and hold harmless the other
for any claims which would constitute a breach of the foregoing representations
and warranties. Purchaser agrees to compensate Broker in full at Closing
pursuant to a separate agreement. Seller warrants and represents that (i) all
brokerage fees incurred in connection with the Lease have been paid in full and
that (ii) there will be no brokerage fees or commissions due in respect of the
extension or renewal of the Lease and Seller shall provide evidence thereof
reasonably satisfactory to Purchaser at or prior to Closing. The provisions of
this paragraph shall survive the delivery of the Deed (hereafter defined) or the
termination of this Contract.
8. Title. A. Purchaser agrees to promptly order a commitment for title insurance
from Escrow Agent. Purchaser shall see that a copy of said commitment is
promptly delivered to Seller and Seller shall be on notice of items contained in
such commitment. Purchaser agrees to take title if same is good and marketable
and if insurable by Escrow Agent and subject only to (i) the Mortgage, (ii) such
restrictions or encumbrances that Purchaser shall consent to in writing and
(iii) the Lease. If Seller shall be notified of a defect in Seller's title, then
Seller shall use its reasonable efforts to attempt to cure such defect(s) and
Seller shall pay or satisfy any defects or other items that can be satisfied by
the payment of money (such as, by way of example, mortgages, mechanic's liens
and deeds of trust), except for the Mortgage. Seller shall be entitled, at its
option, to extensions of the Closing Date for up to thirty (30) days in the
aggregate to attempt to cure such defect(s) (but in no event past the expiration
date of the Confirmation (hereafter defined). Should Seller not cure such
defect(s) despite Seller's reasonable efforts therefor, then Purchaser shall
have the option (exercisable within ten (10) days of Seller's notification
thereof to Purchaser), to close on its purchase of the Premises in accordance
with the terms hereof with no abatement or offset. If Purchaser shall not have
timely exercised its option set forth in the preceding sentence, then this
Contract shall terminate, the Downpayment shall be returned to Purchaser, and
the parties shall have no other liability to each other. Purchaser shall have
five (5) business days from its receipt of a continuation report to notify
Seller of any new title defects therein disclosed and the provisions of this
Paragraph shall apply in respect of such title defects. For purposes of this
Paragraph, violations of applicable building or zoning law against the Premises
shall constitute title defects.
B. Seller agrees to deliver (and Purchaser agrees to accept) a limited warranty
deed (or its local equivalent) in form satisfactory for recording and otherwise
satisfactory to Purchaser (the "Deed").
9. Closing Costs. Purchaser shall pay for all of its costs of closing including
its own attorney fees. Seller shall pay for all of its costs of closing
including its own attorney fees. Seller shall also pay the transfer fee and all
other transfer taxes and recording fees due in connection with the sale and
shall pay for the base premiums due on Purchaser's title insurance policy (but
Purchaser shall be responsible for any additional premiums for Lender's
coverage, if any). Purchaser shall pay the assumption fee charged by Lender in
connection with Purchaser's assumption of the Mortgage (in an amount not to
exceed 1% of the then-outstanding principal balance of the Mortgage) and the
cost of an updated survey if Purchaser elects to obtain one.
10. FIRPTA. Seller warrants and represents that it is not a "foreign person" as
defied in Section 1445 of the Internal Revenue Code, as amended, and Seller
shall supply at Closing an appropriate non-foreign person affidavit pursuant to
said Section 1445.
11. Authorization of Purchaser. Purchaser warrants and represents that it was
duly organized and is in good standing in its jurisdiction of organization.
Purchaser warrants and represents that it has the authority to enter into this
Contract and agrees to supply to Seller such information as Seller may require
(such as its articles of organization and operating agreement) to establish to
Seller's reasonable satisfaction the accuracy of the warranties and
representations contained in this paragraph. Purchaser represents that its
signatory was fully authorized to execute and deliver this Contract on its
behalf.
12. Authorization of Seller. If Seller shall be a corporation, partnership or
other entity, Seller warrants and represents that it was duly organized and is
in good standing in its jurisdiction of organization and that it is in good
standing in the State in which the Premises is located. Seller warrants and
represents that it has the authority to enter into this Contract and agrees to
supply to Purchaser such information as Purchaser may require (such as its
certificate of incorporation, by-laws and resolutions adopted by its board of
directors if it shall be a corporation) to establish to Purchaser's reasonable
satisfaction the accuracy of the warranties and representations contained in
this paragraph. Seller represents that its signatory was fully authorized to
execute and deliver this Contract on its behalf.
13. Included Property. This sale includes all the right, title and interest of
Seller in and to all easements, rights of way, privileges, appurtenances,
certificates, licenses, tax reduction proceedings (and the refunds or credits
there from), permits and rights to the same belonging to and inuring to the
benefit of the Premises, insurance proceeds, condemnation proceeds, supplies,
fixtures and articles of personal property attached to or appurtenant to the
Premises or used in connection with the operation of the Premises and owned by
Seller. No rents or leases will, on the Closing Date, be assigned or pledged by
Seller except to Purchaser in connection with the Closing.
14. Closing Documents. A. As a condition to the Closing, Seller agrees to
deliver to Purchaser on the Closing Date all documents, in form reasonably
satisfactory to Purchaser, necessary to effectuate the provisions hereof
including, without limitation:
1. The Deed.
2. The original Lease. To the extent Seller is only in possession of a copy of 5
the Lease, then a copy of the Lease certified by Seller to Purchaser as a true
and complete copy shall be in lieu of the original.
3. An assignment of the Lease, in recordable form, sufficient to transfer and
convey the landlord's interest in, to and under the Lease to Purchaser (the
"Lease Assignment"). The Lease Assignment shall include an assignment of the
security deposit, if any, held in respect of the Lease. The Lease Assignment
shall contain a warranty by Seller that it is the owner of the landlord's
interest in the Lease, and that it has full right and title thereto and
authority to transfer and convey the same and that the same are free and clear
of all liens and encumbrances. The Lease Assignment shall also be executed by
Purchaser and shall also provide that (i) Purchaser indemnifies and holds Seller
harmless from and against all of the obligations of the landlord accruing or
arising under the Lease from and after the Closing Date and (ii) Seller
indemnifies and holds Purchaser harmless from and against all of the obligations
of the landlord accruing or arising under the Lease prior to the Closing Date.
4. A notice of sale to the Tenant directing the Tenant to make all further rent
payments to Purchaser as Purchaser may direct.
5. The certificate or other evidence reasonably satisfactory to Purchaser that
Purchaser has been named on the Tenant's insurance policy(ies) required under
the Lease.
6. The Landlord's Certificate, the Estoppel Certificate (with it being
understood and agreed that Seller's inability to procure and deliver to
Purchaser the Estoppel Certificate from Tenant in the form required by Paragraph
20 below shall constitute a failure of a condition precedent to Purchaser's
obligation to close and specifically not a default on the part of Seller) and
the Seller's Certificate.
7. A title affidavit that all improvements have been fully paid for and to such
other matters as Escrow Agent shall require.
8. The original Consent.
9. Such other documents that shall reasonably be required to consummate the
transactions herein contemplated.
B. Purchaser agrees to execute and deliver to Seller on the Closing Date all
documents, in form reasonably satisfactory to Seller, necessary to effectuate
the provisions hereof including, without limitation:
1. The Cash Portion of the Purchase Price.
2. The Lease Assignment.
3. The Consent.
4. Such other documents that shall reasonably be required to consummate the
transactions herein contemplated.
15. Pre-Closing Obligations of Seller. Between the date hereof and the Closing
Date, Seller shall:
a. Furnish Purchaser with such information in the possession of Seller with
respect to the operation and maintenance of the Premises as Purchaser shall
reasonably request.
b. Not withdraw, settle or compromise any reduction proceeding affecting real
estate taxes assessed against the Premises without the prior consent of
Purchaser which consent shall not be unreasonably withheld or delayed. Any
future refunds and related fees shall be prorated between Purchaser and Seller
as of the Closing Date (with net refunds being paid first to the Tenant if
required under the Lease); this obligation shall survive the Closing Date.
c. Permit Purchaser and its representatives access to the Premises, and to
Seller's records in respect of the Premises, upon reasonable prior notice and at
reasonable times.
d. Not amend, modify, terminate, grant any consent under or waive any provision
of the Lease, the Mortgage or any other loan document, without the prior written
consent of Purchaser.
e. Cause the Premises to be maintained in good condition and also to comply with
the requirements, if any, of the landlord under the Lease.
f. Not allow or consent to any modification of any easements, restrictions
and/or requirements of record against the Premises (or the imposition of any new
easements, restrictions and/or requirements) and not allow or consent to any
zoning change affecting the Premises.
16. Closing. A. Subject to extensions as herein expressly permitted, the parties
agree that the closing (the "Closing") shall occur on or about the date that is
thirty (30) days following the expiration of the Due Diligence Period. The
Closing shall take place at or through the offices of Escrow Agent (the "Closing
Date"). If Purchaser shall have failed or been unable to timely close despite
the satisfaction of all of the conditions to Closing contained herein, then upon
at least ten (10) business days' notice from Seller to Purchaser and Escrow
Agent this Contract shall terminate, neither party shall have any further
obligations to the other and Seller shall be entitled to the entire Downpayment
and any interest earned thereon (with it being understood and agreed that the
liquidated damages clause contained in this Paragraph 16 shall not vitiate
Purchaser's indemnity obligations in connection with the Inspection, the Phase I
and the Phase II as set forth in Paragraph 5 above). Notwithstanding anything
contained in this Contract to the contrary it is understood and agreed that in
the event of any default on the part of the Purchaser, Seller agrees to look
solely to the Downpayment in accordance with the terms hereof as its liquidated
damages and waives any claim for specific performance or any other claim either
against the Purchaser or against any person disclosed or undisclosed. Seller and
Purchaser acknowledge that the amount of damages of one party occasioned by a
default of the other party hereunder would be difficult or impossible to
accurately predict and Seller and Purchaser, after consultation with counsel of
their own choosing, agree that the liquidated damages provided for in this
paragraph are reasonable sums to be used as liquidated damages. In no event
shall Purchaser be liable for actual, consequential or special damages.
Notwithstanding anything to the contrary set forth in this Contract, in the
event Seller shall default hereunder Purchaser's sole right shall be to either
(i) receive back its Downpayment with interest thereon (plus reimbursement by
Seller of Purchaser's actual out-of-pocket expenses incurred in connection with
the Premises or this Contract) or (ii) seek specific performance of this
Contract (and if Purchaser shall be successful Seller shall be responsible to
reimburse Purchaser for Purchaser's legal fees and other costs associated with
the application for specific performance).
B. It is a condition to Purchaser's obligations under this Contract that between
the date hereof and the Closing Date (i) there shall be no material, adverse
change in the physical or environmental condition of the Premises, (ii) there
shall be no change in the accuracy and completeness of any of the Seller's
representations and warranties made in this Contract, (iii) there shall be no
material adverse change in the financial condition of the Tenant (a "material
adverse change" for purposes hereof shall mean either the filing by or against
such party of a petition in bankruptcy, an admission in writing by any such
party of its general inability to pay its debt when due or the default by any
such party under its operating line of credit or other corporate level
indebtedness or an announcement of the need to restate previously reported
earnings or the actual restatement thereof or an announcement of an SEC or other
governmental investigation of such party or the lowering of the credit rating on
any such party by a nationally recognized credit rating agency (unless such
party was on "credit watch" or similar by the applicable credit rating agency as
of the date hereof)), (iv) there shall be no Violation imposed or threatened in
writing, (v) there shall be no Litigation or condemnation commenced or
threatened and (vi) Tenant shall not have discontinued operations at the
Premises or indicated to Seller either orally or in writing that it intends to
do so. At Closing, Seller shall certify to Purchaser as part of the Seller's
Certificate that to its actual knowledge none of the items listed in (i) - (vi)
above shall have occurred; provided that if Seller shall obtain knowledge of any
matter which would cause a violation of (i) - (vi) above prior to the Closing,
Seller agrees to promptly notify Purchaser of such matter. If Seller does not
indicate in its notice to Purchaser that it will be satisfying and/or complying
with such matters (or, having indicated that it will so satisfy and/or comply,
is then not able to, or if the matter in question is a violation of (iii) or
(vi) above) then Purchaser shall have ten (10) days from receipt of Seller's
notice (or ten (10) days from receipt of notice that Seller having elected to
attempt to satisfy and/or comply but was unable to do so) in which to terminate
this Contract and receive back its Downpayment and the interest thereon,
following which neither party shall have any further obligation to the other
hereunder. Seller shall be entitled to an extension of the Closing for thirty
(30) days in order to attempt to satisfy and/or comply with any such matters
(other than items (iii) or (vi)). If Purchaser shall not so terminate this
Contract then Purchaser shall close without abatement or offset in the purchase
price.
C. Notwithstanding anything to the contrary set forth herein, (i) provisions of
this Contract permitting Seller for any reason to extend the Closing Date shall
not be cumulative so that if there shall be two or more items allowing Seller to
extend the Closing Date hereunder, Seller shall only be entitled to extend for
the longest period allowed by any one of the rights to extend, and (ii) despite
any specific provision of this Contract allowing for a specific time for Seller
to extend the Closing Date, Seller shall not be permitted to extend the Closing
Date beyond the expiration date of the Confirmation (hereafter defined).
17. Casualty. The risk of loss or damage or destruction to the Premises by fire
or other casualty is assumed by Seller until the Closing. In the event of fire
or other casualty, Seller shall immediately notify Purchaser thereof and shall
simultaneously notify Purchaser whether or not Seller intends to repair the
Property and restore same to the condition in existence prior to such damage or
destruction. If Seller so elects to restore and repair the Property, then Seller
shall be entitled to extend the Closing Date for up to thirty (30) days in the
aggregate to complete same. In the event that either (i) Seller shall fail to
notify Purchaser that it intends to repair or restore the Property as aforesaid
or (ii) Seller notifies Purchaser that it does not elect to so repair or restore
or (iii) the damage is of such a nature that it cannot reasonably be restored
and repaired within such 30 day period or (iv) Seller, having notified Purchaser
that it elects to restore and repair the Property as aforesaid, subsequently
fails to complete such repair and restoration within the aforementioned thirty
(30) day period, then in any such event Purchaser shall have the option,
exercisable within fifteen (15) days of the event giving rise to Purchaser's
right to so elect, of either (i) declaring this Contract terminated in which
event Escrow Agent shall refund to Purchaser, with the interest earned thereon,
the Downpayment whereupon this Contract and all rights of Purchaser hereunder
and to the Premises shall terminate and neither Seller nor Purchaser shall have
any further claim against the other, or (ii) closing title in accordance with
this Contract and paying in full the Purchase Price, without any abatement
thereof or claim against Seller for such loss or damage (except solely that
Seller shall credit the purchase price by the amount of its insurance
deductible), and accepting an assignment, without recourse, of Seller's rights,
if any, to any payments to be made under any applicable hazard insurance
policies together with any payments under such policies made to Seller prior to
the Closing and not expended to repair or replace such loss, damage or
destruction together with payment by Seller to Purchaser of the amount of the
applicable deductible. If Purchaser shall have failed to timely make an election
pursuant to the foregoing sentence Purchaser shall be deemed to have elected to
terminate this Contract in accordance with (i) above. This paragraph shall
govern to the extent inconsistent with any applicable law.
18. Condemnation. As of the date hereof, Seller represents and warrants that it
has no knowledge of any pending or contemplated condemnation proceedings
affecting the Premises or any part thereof. If prior to the Closing, all of the
Premises shall be taken by condemnation, eminent domain or deed in lieu thereof
or such a taking shall be threatened in writing by the applicable governmental
authority having jurisdiction over the Premises, this Contract shall be
automatically canceled, the Downpayment together with any interest thereon shall
be returned to Purchaser and thereupon neither party shall have any further
liability or obligation to the other. Seller agrees not to deliver a deed in
lieu or its equivalent without the prior written consent of Purchaser. If prior
to the Closing date, (a) a portion, but less than all, of the Premises shall be
taken by condemnation, eminent domain or deed in lieu thereof, or (b) there is
any taking of the land lying in the bed of any street, road, highway or avenue
open or proposed, in front of or adjoining all or any part of the Premises, (c)
there is any change of grade of any street, road, highway or avenue, or (d) a
taking described in (a), (b) or (c) above shall be threatened in writing by the
applicable governmental authority having jurisdiction over the Premises, then in
any of such events Purchaser may cancel this Contract by sending written notice
thereof to Seller within thirty (30) days of Purchaser's receipt of notice of
such condemnation, eminent domain, change of grade or other taking, in which
event Escrow Agent shall return to Purchaser the Downpayment with interest
thereon and thereupon neither party shall have any further liability or
obligations to the other. If this Contract is not canceled Purchaser shall
accept title to the Premises subject to the condemnation, eminent domain, taking
or change of grade, in which event on the Closing Date the net proceeds of the
award or payment (after payment of all actual collection costs) shall be
assigned by Seller to Purchaser and net monies theretofore received by Seller in
connection with such condemnation, eminent domain, taking or change of grade
shall be paid over to Purchaser or allowed as a credit against the purchase
price hereunder.
19. Apportionments. Rent and additional rent and interest under the Mortgage
shall be apportioned as of the Closing Date. Taxes, special assessments,
utilities and other charges shall be apportioned except to the extent same are
to be reimbursed or paid by the Tenant pursuant to the Lease.
20. Lease. It is a condition to Purchaser's obligations hereunder that (i) on
the Closing Date the lease attached hereto as Exhibit B between Seller and the
Tenant (the "Lease") shall be in full force and effect (without default) and
there shall be no other tenants, licensees, concessionaires or others occupying
the Premises and (ii) on the Closing Date there shall be delivered to Purchaser
an estoppel certificate of the Tenant (the "Estoppel Certificate") in respect of
the Lease (effective as of the Closing Date) in the form to be provided by
Purchaser to Seller prior to the expiration of the Due Diligence Period (with it
being understood and agreed that Seller's inability to procure and deliver to
Purchaser the Estoppel Certificate from Tenant in the form required by this
Paragraph 20 shall constitute a failure of a condition precedent to Purchaser's
obligation to close and specifically not a default on the part of Seller), dated
no more than twenty (20) days prior to the Closing Date and (iii) on the Closing
Date no event shall have occurred which would by itself or with the passage of
time and/or the giving of notice constitute a default of the Tenant or Seller
under the Lease and Seller shall certify same at Closing pursuant to a form
acceptable to Purchaser (the "Landlord's Certificate"). Seller agrees to use its
reasonable efforts to attempt to obtain the Estoppel Certificate and Seller
shall be entitled to extensions of the Closing Date for up to thirty (30) days
in the aggregate in order to satisfy its obligations under the previous
sentence. If Seller has not timely satisfied the foregoing conditions, at the
expiration of such thirty (30) day extension, then Purchaser shall have the
option (exercisable by written notice within seven (7) days of Seller's notice
of its inability as aforesaid) to either close on Purchaser's acquisition of the
Premises and pay in full the purchase price without any offset, abatement or
credit against Seller or to terminate this Contract in which event the
Downpayment with interest thereon shall be returned to Purchaser and neither
party shall have any further rights or obligations hereunder to the other.
Seller warrants and represents that it has not nor will it in the future collect
rent more than thirty (30) days in advance of the date due and this sentence
shall survive the Closing.
21. Common Development Restrictions/Zoning. In the event that the Premises is
part of a shopping center or is otherwise governed by easements, restrictions
and/or requirements (collectively, "Restrictions"), then it shall be a condition
to Purchaser's obligations hereunder that on or prior to the Closing Date there
shall be delivered to Purchaser an estoppel certificate (the "Certificate") of
the developer of the shopping center and such other parties, if any, obligated
to deliver such a Certificate pursuant to the terms of the applicable
Restriction, in form as required under the terms of the agreement containing the
Restrictions and otherwise in form and substance reasonably acceptable to
Purchaser (with it being understood and agreed that Purchaser shall deliver any
additional comments and requirements to the form to be delivered pursuant to the
applicable Restriction by no later than the expiration of the Due Diligence
Period), dated no more than twenty (20) days prior to the Closing Date, and
certifying among other things that the Premises is in conformance with the
requirements contained in the Restrictions and that the owner of the Premises
has fulfilled all obligations of it and there are no unpaid contributions owed
or to be owed by the owner of the Premises in connection with the construction
of the shopping center or any common areas or signs. Seller agrees to use its
reasonable efforts to obtain the Certificate and Seller shall be entitled to
extensions of the Closing Date for up to 30 days in the aggregate in order to
obtain same. If Seller has not been able to timely obtain the Certificate by the
Closing Date (as extended), then Purchaser shall have the option to either close
on Purchaser's acquisition of the Premises and pay in full the purchase price
'without any offset, abatement or credit against Seller or to terminate this
Contract in which event the Downpayment with interest thereon shall be returned
to Purchaser and neither party shall have any further rights or obligations
hereunder to the other.
22. Miscellaneous. A. "All notices, demands and other communications required or
permitted to be given hereunder shall be in writing and shall be deemed to have
been properly given if delivered by hand or sent by United States registered or
certified mail, return receipt requested, or sent by Federal Express or other
overnight delivery service, to Seller at its address set forth above with a copy
to Kenneth J. Yarsky, II, Esq., Yarsky & Brown, LLP, 404 Grant Building,
Pittsburgh, PA 15219, or at such other addresses as it may designate by notice
hereunder and to Purchaser at its address set forth above (for the attention of
Mark H. Lundy) with a copy to Richard M. Figueroa at Purchaser's address set
forth above or at such other addresses as it may designate by notice hereunder.
The address for Escrow Agent is 633 Third Avenue, New York, New York 10017. The
respective attorneys for Seller and Purchaser shall be authorized to give and
receive any notices required or permitted to be sent hereunder and shall be
permitted to agree on adjournments of the Closing Date.
B. This Contract shall be governed by and construed in accordance with the laws
of the State in which the Premises is located.
C. This Contract contains the entire agreement between the parties hereto in
respect of the matters hereto and supersedes any prior (oral or written)
agreements. This Contract has been negotiated and shall not be construed against
its drafter. This Contract may not be modified nor any of its terms waived
except by a writing executed by the party to be charged by such modification or
waiver. If any provision hereof shall be deemed unenforceable, the remaining
terms of this Contract shall be unaffected thereby and shall remain in effect.
The headings used herein are for reference purposes only and shall not affect
the interpretation of this Contract.
D. If either party shall be required to employ an attorney to enforce or defend
the rights of such party under this Contract, the prevailing party shall be
entitled to recover their reasonable attorneys' fees and expenses. This
provision shall survive the Closing or earlier termination of this Contract.
E. Except as otherwise specifically set forth herein, Purchaser shall indemnify,
defend and hold Seller harmless with respect to liability from injury to persons
or property or liens or causes of actions for matters in respect of the Premises
first accruing subsequent to the Closing. Except as otherwise specifically set
forth herein, Seller shall indemnify, defend and hold Purchaser harmless with
respect to liability from injury to persons or property or liens or causes of
actions for matters in respect of the Premises first accruing prior to the
Closing. This Paragraph 22E shall survive Closing and the transfer of the
Premises to Purchaser.
23. Financing. A. Seller represents that the Premises is currently encumbered by
a non-recourse first mortgage or deed of trust (the "Mortgage") in favor of GE
Capital Business Asset Funding Corp. (the "Lender"). Seller represents that
there is no default under the Mortgage as of the date hereof and covenants that
there shall be none on the Closing Date, and Seller further represents that
there are no financing documents relating to the Mortgage other than the
documents to be delivered to Purchaser as required by Paragraph 5 of this
Contract and none has been amended. Seller represents and warrants that the
Mortgage had an outstanding principal balance of $2,781,735.00 (as of July 1,
2004), that the Mortgage bears interest at a fixed rate of 8.35%, that the
Mortgage requires monthly payments of principal and interest in the amount of
$23,649 and that the Mortgage has a maturity date of February, 2010 and
amortizes over a 25-year amortization schedule. Seller further represents that
the Mortgage may be assumed (on a non-recourse basis) by a purchaser of the
Premises with the approval of the Lender, such approval not to be unreasonably
withheld, and upon the payment of a 1% assumption fee.
B. Promptly following the date hereof, Purchaser agrees to apply for and then to
use its good faith efforts to attempt to obtain the written confirmation of the
Lender (the "Confirmation") that at Closing and provided all conditions in the
Confirmation have been satisfied, Lender shall execute a formal document which
shall include (i) the consent of the Lender to the assumption by Purchaser on a
non-recourse basis of the Mortgage from and after the Closing date, together
with a release by the Lender of the Seller from the obligations of the Mortgage
and related loan documents from and after the Closing date and (ii) an estoppel
certificate of the Lender in respect of the Mortgage, all in form and substance
reasonably satisfactory to Purchaser (collectively, the "Consent"). Seller
agrees to reasonably cooperate with Purchaser in its attempts to obtain the
Confirmation and Consent.
C. In the event that Purchaser has been able to obtain the Confirmation, then
Purchaser shall send a copy thereof to Seller. The conditions to closing in the
Confirmation (if any) shall likewise be conditions to Purchaser's obligations to
close hereunder, and it shall also be a condition to Purchaser's obligations to
close hereunder that Lender shall, at or prior to Closing, execute and deliver
all documentation necessary to effectuate the assumption of the Mortgage (on a
non-recourse basis) by Purchaser (including, without limitation, the Consent) as
contemplated in this Contract. Notwithstanding anything to the contrary set
forth herein, Purchaser shall be entitled to extend the Closing Date for up to
thirty (30) days in order to attempt to satisfy the conditions of the
Confirmation and thereafter close.
D. In the event that Purchaser has not been able to obtain the Confirmation on
or before the date that is five (5) days prior to the Closing Date, then
Purchaser shall so notify Seller and include a copy of the formal rejection from
the Lender, if any. If Purchaser shall have so notified Seller, then this
Contract shall terminate and the Downpayment, with the interest thereon, shall
be paid to Purchaser and the parties shall not have any other rights or
obligations to each other hereunder.
E. In the event this Contract is terminated as a result of Seller's default,
then Seller shall also reimburse Purchaser for all of Purchaser's reasonable
costs and expenses incurred in connection with its application for the
Confirmation and the Consent.
24. SEC Reporting Compliance. Seller acknowledges that Purchaser has informed
Seller that Purchaser is an affiliate of a publicly traded real estate
investment trust. Accordingly, to the extent an SEC Section 314 audit shall be
required by applicable law in respect of Purchaser's acquisition of the
Premises, Purchaser's obligations hereunder shall be conditioned on a
satisfactory SEC Section 314 audit of the Premises by Ernst & Young LLP
(Purchaser's independent auditors or any successor) by the expiration of the Due
Diligence Period. Seller agrees to 'cooperate with such auditors and to provide
such information and certifications as are customarily required by Ernst & .
Young LLP to complete an SEC Section 314 audit.
25. Section 1031 Tax Deferred Exchange. At either party's option, the
non-requesting party agrees to cooperate with the requesting party to qualify
this transaction as a like-kind exchange of property described in Section 1031
of the Internal Revenue Code of 1986, as amended. The non-requesting party
further agrees to consent to the assignment of this Contract to a "Qualified
Intermediary" and/or take such other action reasonably necessary to qualify this
transaction as a like-kind exchange provided that (i) such exchange shall be at
the cost and expense of the requesting party, (ii) the non-requesting party
shall incur no liability as a result of such exchange and (iii) no such
assignment of this Contract shall relieve the requesting party of its
obligations under this Contract and the requesting party shall remain liable for
the performance of its obligations hereunder including, without limitation, the
representations, warranties, and covenants given by the requesting party to the
non-requesting party in this Contract.
IN WITNESS WHEREOF, the undersigned have duly executed and delivered this
Contract as of the date first hereinabove written. LACROSSE PARTNERS, LTD.,
as Seller OLP ONALASKA LLC, as Purchaser
[GRAPHIC OMITTED][GRAPHIC OMITTED]
First American Title Insurance Company, solely in its capacity as Escrow Agent
By:
Name:
Title:
By Champion Properties, Inc., its general partner
By: Name: Richard M. Erenberg Title: President
[GRAPHIC OMITTED][GRAPHIC OMITTED]
as of the date first hereinabove written. LACROSSE PARTNERS, LTD., as Seller
By Champion Properties, Inc., its general partner
By: Name: Richard M. Erenberg Title: President
OLP ONALASKA LLC, as Purchaser
By:,
Name:
Title:
First American Title Insurance Company, solely in its capacity as Escrow Agent
[GRAPHIC OMITTED][GRAPHIC OMITTED]
EXHIBIT A
Legal Description