Exhibit 10.1


 


McGINNIS COMMERCIAL REAL ESTATE COMPANY


555 East Loockerman Street * Dover, Delaware
19901

(302) 736 - 2710 Office * (302) 736 - 2715 Telecopier * www.mcginnisrealty.com


 


AGREEMENT  OF  SALE


 


THIS AGREEMENT OF SALE, made this 8 day of August,   2005,
by and between PHILIPS EAST SIDE LLC, c/o Philips
International Holding Corp., 295 Madison Avenue, New York, New York 10017,
hereinafter “Purchaser,” Party of the First Part, who hereby agrees to purchase
from DOVER DOWNS, INC, of 1131 North DuPont Highway, Dover, Delaware, 19901,
hereinafter “Seller,” Party of the Second Part, who hereby agrees to sell to
the Purchaser all that/those certain parcel/s of land with/without
improvements, hereinafter “Property,” described as follows:


 


(a) the land and premises known as the Dover Downs Lowe’s
Property, 1165 North DuPont Highway, Dover, Kent County, Delaware, 19901, as
shown on Exhibit A, attached hereto and incorporated herein by this
reference. The Property is more thoroughly described in the land records of
Kent County, Delaware in deed reference Book D463, Page 023 and deed
reference book D584, Page 004, attached hereto as Exhibit B,
attached hereto and incorporated herein by this reference, and tax
identification parcel ED05-057.00-01-28.00, attached hereto as Exhibit C,
attached hereto and incorporated herein by this reference (hereinafter referred
to as the “Premises”) including, but not limited to all rights,
privileges and easements appurtenant to and for the benefit of the Premises
including, without limitation; all mineral rights, development rights, air
rights, water, water rights and water stock relating to the Premises and any
other easements, rights-of-way or appurtenances relating to or used in
connection with the ownership, operation, use, occupancy and enjoyment of the
Premises and further including all improvements, structures, buildings and
fixtures presently located on the Premises, together with all apparatus,
equipment and appliances, if any (the “Personalty”) owned by the Seller and


 





















 


located on the Premises (such as heating and air-conditioning systems),
as well as all landscaping thereon and all leasehold improvements of tenants,
if any, which remain a part of the Premises upon expiration of any Lease (as
defined below) and all rights, title and interest of Seller in and to all
streets, roads and rights-of-way contiguous to the Premises and Seller’s
interest in any strips or gores between the Premises and abutting properties; (b) to
the extent assignable, except as provided herein, all utility, service,
equipment, maintenance and other contracts relating to the ownership,
operation, maintenance or use of the Premises which Purchaser desires to assume
or take subject to as more fully provided herein (collectively, “Service
Contracts”); (c) Seller’s interest in those leases (collectively, “Leases”)
demising portions of the Premises to tenants (collectively, “Tenants”);
and (d) all assignable or transferable intangible property, including, but
not limited to:  (i) all guaranties
and warranties (including guaranties and warranties pertaining to construction
and use of the Personalty); (ii) all rights to obtain utility service in
connection with the Premises and the Personalty; and (iii) all assignable
licenses and other governmental permits and permissions relating to the
Premises and the Personalty or the operation thereof, to the extent any of the
foregoing are permitted to be assigned under relevant local, state and federal
law (all of the foregoing are hereinafter collectively referred to as the “Intangible
Property”).  The Premises,
Personalty, Property Contracts, Leases and Intangible Property are hereinafter
collectively referred to as the “Property”.


 


THE PURCHASE PRICE THEREOF is the sum of TWELVE MILLION EIGHT HUNDRED
TWENTY FIVE THOUSAND ($12,825,000.) DOLLARS, payable in the following manner:


 


A deposit in the amount of TWO HUNDRED THOUSAND DOLLARS ($200,000.),
paid by cashier’s or certified check at the signing of this Agreement of Sale
as a good - faith deposit, to be credited to the Purchase Price hereunder and
disbursed in accordance with the


 





















 


provisions of this Agreement of Sale, and held by First American Title
Insurance Company, Escrow Agent, in an interest - bearing account, the said
interest accruing to the benefit of the Purchaser. The Purchaser, by executing
this Agreement of Sale, hereby authorizes Escrow Agent to place the said escrow
deposit monies in an interest - bearing account. The Purchaser’s Taxpayer
Identification Number is 20-2824845.


 


An additional
deposit in the amount of TWO HUNDRED THOUSAND DOLLARS ($200,000.), paid by
cashier’s or certified check, in accordance with the terms and conditions of
this agreement of Sale, at the time the Due Diligence Period, as defined
herein, expires, and which shall also be credited to the Purchase Price
hereunder and disbursed in accordance with the provisions of this Agreement of
Sale, and shall also be held by Escrow Agent, in an interest - bearing account,
the said interest accruing to the benefit of the Purchaser.


 


The balance of the Purchase Price hereunder, TWELVE MILLION FOUR
HUNDRED TWENTY FIVE THOUSAND ($12,425,000.) DOLLARS, shall be paid in cash,
certified check, or attorney’s escrow check, at the time of final Settlement as
defined herein.


 


DUE DILIGENCE PERIOD. The Purchaser shall have until 5:00 P.M., on
that day (the “Delivery Date”) which is THIRTY (30) days after delivery of all
of the documents listed in the attached Schedule A (the “Due Diligence
Documents”) to complete its tests, 
studies, and investigations including zoning, easement agreement review
and approval, soils analyses, environmental tests and studies, flood plain
analyses, inspection of all improvements, surveying, lease review, analysis,
and approval, and any and all other tests and studies it requires to complete
the transaction contemplated herein. All said tests, studies, and analyses
shall be concluded with results satisfactory to Purchaser at its sole
discretion, and its sole cost and expense.


 





















 


In the event Purchaser does not as a result of the said tests, studies,
and analyses agree to proceed to final Settlement, Purchaser may elect to void
this Agreement of Sale in writing in the manner provided for herein, whereupon
Escrow Agent shall return to Purchaser all monies paid on account of the
Purchase Price hereunder, together with all interest, if any, accrued thereon
without deduction or offset. Purchaser agrees to void the Agreement of Sale in
writing, and further agrees to convey at no cost to Seller copies of the said
tests, studies, and analyses, to the extent same are in Purchaser’s possession
or control. In the event Purchaser shall fail to notify Seller of its intention
to void this Agreement of Sale within the Due Diligence period, Purchaser shall
be deemed to have waived its rights to void this Agreement of Sale.


 


Seller agrees to provide to Purchaser, in a timely fashion after this
Agreement of Sale is executed by all parties hereto, copies of any tests,
studies, investigations, and analyses pertaining to the Property in Seller’s possession,
including copies of all lease agreements encumbering the Property.


 


In the event Purchaser does not void this Agreement of Sale prior to
the expiration of the Due Diligence Period, (i) this
Agreement shall remain in full force and effect; and (ii) subject
to any other conditions of this Agreement, Seller and Purchaser shall proceed
to Closing.


 


At the time Purchaser waives its rights under this Due Diligence
paragraph, all deposit monies paid by Purchaser, totaling Four Hundred Thousand
Dollars ($400,000) shall be non-refundable, subject to the other terms and
conditions of this Agreement.


 


FINAL SETTLEMENT.  The final
Settlement shall be held on or before the sixtieth (60th) Day
following the expiration of the Due Diligence Period, provided such date does
not fall on a Saturday or Sunday or other legal holiday, in the office of the
Purchaser’s attorney, or at such other place as the Purchaser may elect.
Notwithstanding the foregoing, the Settlement may be


 





















 


extended through and including the ninetieth (90th) day
following the expiration of the Due Diligence Period, at the option of the
Purchaser, upon the Purchaser making an additional deposit in the amount of TWO
HUNDRED THOUSAND ($200,000.) DOLLARS on or before the ninetieth (90th)
Day following the expiration of the Due Diligence Period.


 


TRANSFER
DOCUMENTS.  At
the time and place of Closing, upon payment in full of the Purchase Price and
satisfaction of all of Purchaser’s obligations under this Agreement, Seller
shall:


 


Convey and
transfer title to the Premises to Purchaser by a Special Warranty Deed in a
form substantially as set forth in Exhibit D hereto, conveying the
Property in fee simple to Purchaser in accordance with the terms hereof,
subject to no liens, encumbrances, conditions or restrictions other than the
Permitted Exceptions as more fully described herein;


 


Execute and
deliver an Assignment of the Leases in a form substantially as set forth in Exhibit E
hereto, whereby, inter  alia, Purchaser shall assume the
obligations of Seller thereunder from and after Settlement.


 


Execute and
deliver a Bill of Sale in a form substantially as set forth on Exhibit F
hereto, with respect to the Personalty, if any;


 


Execute and
deliver an Assignment of Service Contracts, in form substantially as set forth
on Exhibit G hereto, whereby, inter  alia, Purchaser
shall assume the obligations of Seller thereunder from and after Settlement;


 


Execute an
Assignment and Assumption of Intangible Property, in form substantially set
forth on Exhibit H hereto, whereby, inter  alia,
Seller shall assign to Purchaser the Intangible Property;


 


Execute tenant
notices on a form to be provided by Purchaser and approved by Seller (such
approval not to be unreasonably withheld, delayed or conditioned), informing
the Tenants of the transfer of the Property and the Leases to Purchaser, and
the assumption by Purchaser of Seller’s obligations under the Leases;


 


Deliver the
originals of all Leases and Service Contracts;


 





















 


Deliver all
leasing and property files and records pertaining to day-to-day operation,
leasing, and maintenance of the Property, provided that proprietary information
of Seller not relevant to the ownership or operation of the Property shall not
be included;


 


Deliver all
keys to the improvements located on the Premises in Seller’s possession to
Purchaser;


 


Execute and
deliver a standard title affidavit executed by Seller and such other
instruments as may reasonably be required by the Escrow Agent to fulfill its
obligations under this Agreement;


 


Deliver any
and all information required by the Escrow Agent to comply with the real estate
reporting requirements set forth in Section 6045(e) of the Internal
Revenue Code of 1986, as amended;


 


Deliver
evidence reasonably acceptable to Purchaser and Title Company (as hereinafter
defined) as to the authority of the person or persons executing documents on
behalf of Seller;


 


Execute and
deliver an affidavit of Seller in the form substantially as set forth in Exhibit I
attached hereto stating Seller’s taxpayer identification number, certifying
that Seller and all persons holding beneficial interests in the Property are
not a “foreign person” as defined in the Federal Foreign Investment in Real
Property Tax Act of 1990, as amended or otherwise confirming that Purchaser is
not required to withhold any part of the Purchase Price pursuant to Section 1445
of the Internal Revenue Code of 1986, as amended;


 


An affidavit
of Seller certifying the satisfaction of the closing conditions set forth
herein;


 


Deliver a rent
roll for the Property, updated to the date and time of Closing and certified to
be complete and accurate by Seller and attached hereto as Exhibit J;


 


Execute and
deliver a 1099S form, or effective equivalent thereof, describing the “sale of
the Property”, together with a designation of the “reporting person” with
respect of such sale;


 


Execute and
deliver a closing statement reasonably acceptable to Seller and Purchaser; and


 





















 


Execute and
deliver such other documents as may be reasonably necessary or appropriate to
complete Settlement of the transaction contemplated hereby, or otherwise
required by the terms of this Agreement.


 


The
instruments of transfer referred to above are hereinafter collectively referred
to as the “Transfer Documents”.


 


CONDITIONS
PRECEDENT TO SELLER’S OBLIGATIONS; CONDITION SUBSEQUENT.  The obligations of Seller hereunder are and
shall be subject to satisfaction of each of the following conditions at or
prior to Settlement:


 


Purchaser
shall have complied in all material respects with all of the terms, covenants
and conditions hereof to be complied with on the part of Purchaser;


 


Seller, the
Title Company or the Escrow Agent shall have in its possession the Purchase
Price in consideration for simultaneous deliverance of the Transfer Documents;


 


This Agreement
shall not have been previously terminated pursuant to a right or privilege
granted to either Seller or Purchaser hereunder;


 


Where
applicable, Purchaser shall have executed the Transfer Documents and delivered
such documents to Seller, Title Company or the Escrow Agent; and


 


Purchaser and
Seller, where applicable, shall have executed the transfer tax return and paid
to the title company such tax.


 


CONDITIONS
PRECEDENT TO BUYER’S OBLIGATIONS.  The obligations of Purchaser
hereunder are and shall be subject to satisfaction of each of the following
conditions at or prior to Settlement:


 


The
representations and warranties made by Seller in this Agreement shall be true
as of the date of this Agreement and as of Settlement, and Seller shall have
complied in all material respects with all of the terms, covenants and
conditions hereof to be complied with on the part of Seller;


 





















 


Seller shall
have executed and delivered the Transfer Documents and shall have delivered all
documents and items required to be delivered on or before Closing by the terms
of this Agreement;


 


This Agreement
shall not have been previously terminated pursuant to a right or privilege
granted to Seller or Purchaser hereunder;


 


Seller shall
have delivered a certificate that Seller is not a “foreign person” within the
meaning of §1445 of the Internal Revenue Code of 1986, as amended;


 


Seller shall
have delivered to Purchaser acceptable estoppel certificates from Best Buy,
Michael’s, and Office Depot (the “Key Tenants) and acceptable estoppel certificates
from tenants representing eighty percent (80%) of the rentable area leased
pursuant to the Leases (such eighty percent (80%) threshold shall be exclusive
of the square feet of rentable area of the Property currently leased to the Key
Tenants), each substantially in the form of Exhibit K, except to
the extent the lease of the tenant in question requires or authorizes such
tenant to execute a different form of estoppel certificate (in which case the
estoppel certificate may be in form consistent with the requirements of, or
authorization set forth in, such lease). 
Notwithstanding the foregoing, Seller agrees to use commercially
reasonable efforts to obtain such estoppel certificates from all tenants of the
Property. An estoppel certificate shall be deemed “acceptable” if it is
complete, and is not materially inconsistent with the representations and
warranties of the Seller hereunder.  No
estoppel certificate shall be required from Dover Downs, Inc. as its lease
becomes effective upon Closing hereunder.


 


Seller shall
have delivered to Purchaser Subordination, Non-Disturbance and Attornment
Agreements in recordable form designated by the Purchaser prior to the
expiration of the Due Diligence Review Period for any leases that are recorded
in the public records, and from all other non-residential tenants of the
property designated by the Purchaser prior to the expiration of the Due
Diligence Review Period


 


SETTLEMENT ADJUSTMENTS.  All
items paid in advance by the Seller, including all property taxes, water,
sewer, and/or property rent, heating fuel, and any and all other such items
shall be pro - rated as of midnight preceding Settlement and Purchaser shall
reimburse Seller at


 





















 


the time of final Settlement as defined herein (except that no
apportionment shall be made for any such items furnished and charged by the
applicable utility company to tenants unless such charge is paid by Seller). If
Settlement occurs before the tax rate is fixed, the apportionment of taxes
shall be upon the basis of the tax rate for the next preceding year applied to
the latest assessed valuation, subject to the post-closing adjustment upon the
determination of the applicable tax rate and recovery thereof.


 


All property rent, common area maintenance, insurance charges and taxes
paid by tenants received by Seller in advance shall be pro - rated as of
midnight preceding the Settlement and Seller shall pay the pro - rated amount
to Purchaser at the time of final Settlement. Further, any and all security
deposits held by Seller on behalf of any tenants located at the Property shall
be paid by Seller to Purchaser, together with an accurate listing of each of
the tenants and the respective security deposit amounts for each tenant, at the
time of final Settlement as defined herein. All rents collected during the
month of Settlement shall be deemed applicable to that current month’s rent for
purposes of apportionment.


 


All rents received post-Settlement shall be applied for purposes
hereof, first to the current month’s rent and then to arrearages collected
post-closing and attributable to Seller which shall be paid over by Purchaser
to Seller promptly following receipt. 
Any delinquent rents or other payments outstanding at the time of
Closing that are subsequently received by Purchaser in its capacity as new
landlord shall be payable to Seller, provided that Purchaser shall not be
legally responsible to Seller for undertaking the collection of any delinquent
rents and other payments. After Settlement, Seller shall have the right to collect
delinquent rentals and other payments so long as it does not enter the Property
or disturb any tenant’s possession or quiet enjoyment of its leased premises.


 


Fifty percent (50%) of all state, county, and city transfer taxes shall
be paid by the Seller


 





















 


at the time of final Settlement; the remaining fifty percent (50%) of
all state, county, and city transfer taxes shall be paid by the Purchaser at
the time of final Settlement.


 


All settlement expenses normally borne by purchasers of real property
in Kent County, Delaware, including but not limited to the cost of title
search, title insurance, legal representation, document recording, and any and
all other such items shall be paid by Purchaser at the time of final
Settlement.


 


In the event that certain Leases require reconciliation of additional
rent “pass-throughs” to the landlord for common area maintenance charges, real
estate taxes or other operating expenses, Purchaser shall perform all of the
obligations of the landlord under the Leases with respect to such
reconciliations in a timely and commercially reasonable manner. If such results
reflect the underpayment of additional rents by Tenants for the year of
Closing, Purchaser shall bill the appropriate amounts to such Tenants in
accordance with the terms of their Leases and remit to Seller its prorata share
of the amount collected from the Tenants within thirty (30) days of Purchaser’s
collection of the same.  If such results
reflect the overpayment of additional rent by Tenants for the year of Closing,
Purchaser shall deliver to Seller an invoice from Purchaser together with
evidence reasonably satisfactory to Seller indicating that such sums are due to
such Tenants.  Seller shall pay Purchaser
Seller’s prorata share of the amounts due to such tenants within thirty (30)
days of Purchaser’s demand.  The
provisions of this paragraph shall survive the Closing.


 


All settlement expenses normally borne by Sellers of real property in
Kent County, Delaware, including prepayment penalties, deed preparation, release
or satisfaction documents, legal representation, brokerage commissions, termite
reports if required by the terms of this Agreement of Sale, and any and all
other such items shall be paid by the Seller at the time of final Settlement.


 





















 


In the event accurate prorations and other adjustments cannot be made
at Settlement because current bills or statements or other information is not
obtainable, the parties shall prorate on the best available information,
subject to adjustment as soon after Settlement as the actual amounts to be
prorated are determined.


 


TITLE AND
SURVEY


 


The Purchaser shall, promptly
following the Delivery Date, obtain (i) a preliminary title
insurance commitment (the “Title Commitment”) issued by First American
Title Insurance Company or its duly authorized agent (the “Title Company”)
covering the Property and improvements, with such Title Commitment setting
forth the status of title to the Property and showing all liens, claims,
encumbrances, easements, rights-of-way, encroachments, reservations,
restrictions and any other matters of record affecting the Property; and, (ii) a
copy of all recorded documents referred to in the title report as exceptions to
the title to the Property (the “Title Documents”).


 


The Purchaser shall, promptly following the Delivery
Date, cause to be prepared and furnished to Purchaser and the Title Company, a
current as-built survey satisfactory to the Purchaser’s lender and certified to
the Purchaser, its lender, the Title Company and each of their successors and
assigns, and meeting the minimum standard detail requirements for an ALTA/ACSM
Land Title Survey (the “Survey”) of the Property prepared by a duly
licensed Delaware land surveyor.


 


The Purchaser shall, within thirty (30) days (the “Title
Approval Date”), inform the Seller in writing as to any survey or title
defects or other objections regarding the Property disclosed by the Survey or
Title Commitment that the Purchaser is unwilling to accept.  Within five (5) business days after
receipt of any timely written title or survey objections from Purchaser, Seller
may either (i) elect to cure such objection(s), or (ii) decline to
cure some or all of such objections. If Seller shall notify Purchaser that it
declines to cure any such title objections, or if Seller elects to cure such
title objections, but then fails or is unable to complete such cure within the
time


 





















 


allowed, or if during such time period Seller
delivers a written notice to Purchaser that such objections are not curable,
then in such event, Purchaser may, by written notice to Seller delivered within
five (5) business days after the expiration of such time or the delivery
of such written notice, either (i) terminate this Agreement by giving the
Seller written notice of such termination; (ii) cure such defects or
objections at its own expense and proceed to Closing with no reduction in the
Purchase Price; or, (iii) waive such defects, with no reduction in the
Purchase Price, proceed to Closing and take title subject to such objections,
in which case all title matters objected to by Purchaser which were not cured
by Seller shall be deemed Permitted Exceptions hereunder.  If the Purchaser so elects to terminate this
Agreement, Escrow Agent shall return to Purchaser all monies paid on account of
the Purchase Price hereunder, together with all interest, if any, accrued
thereon without deduction or offset, in which case, Seller shall reimburse
Purchaser for the reasonable out-of-pocket costs actually incurred by Purchaser
in anticipation of consummating the transactions described herein, including,
without limitation, those expenses related to applications to lenders for
financing of this transaction, third party inspection reports and title and
survey examination in an amount not to exceed $10,000, and thereafter the
parties hereto shall have no further obligations or liabilities to one another
hereunder (except for obligations which by their terms survive the termination
of this Agreement).  If the Purchaser (i) fails
to notify the Seller of any survey or title defects or objections to the
Property on or before the Title Approval Date, or (ii) has notified the
Seller of defects or objections which remain uncured by the Seller by Closing
and the Purchaser has not terminated this Agreement, all matters relating to
the Survey or title to the Property disclosed on the Survey and the Title
Commitment as of their respective dates shall be Permitted Exceptions
hereunder.


 


Notwithstanding anything in this
Agreement to the contrary, and notwithstanding any approval or consent given by
Purchaser hereunder, Seller shall cause all mortgages and deeds of trust
encumbering Seller’s interest in the Property, all judgments against the Seller
and/or the Property to be satisfied and vacated, and all mechanic’s liens filed
against the Property relating to work performed on the Property, to be released
and reconveyed from the Property, or, with respect to such judgments and
mechanic’s liens, otherwise bonded, on or prior to Settlement, and


 





















 


shall cause the Title Company to insure
title to the Real Property as vested in Purchaser without any exception for
such matters.


 


After the Title Approval Date but
prior to Closing or the termination of this Agreement, Seller shall not enter
into any easements, encumbrances or other title matters or recordable
instrument affecting the Property, nor take any action to cause title to the
Property to differ from the condition of title set forth in the Title
Commitment and approved by Purchaser, without Purchaser’s consent.


 


Notwithstanding anything in this
Agreement to the contrary, and notwithstanding any approval or consent given by
Purchaser hereunder, at Closing, Seller shall convey good and marketable fee
simple title to the Property, free and clear of all liens, encumbrances,
conditions and restrictions to Purchaser by special warranty deed and shall
convey Seller’s interest in the Personalty to Purchaser by bill of sale.


 


Purchaser hereby expressly permits
and acknowledes that Seller has caused to be recorded in the land records of
Kent County, Delaware those certain (i) Grant of Easement conveying a
non-exclusive access easement over certain portions of the Property for the
benefit of Dover Litho Printing Company, recorded on June 21, 2005 as
Instrument 2005-17546, a copy of which is attached hereto as Exhibit M;
(ii) and Declaration of Easement conveying an exclusive easement for foot
and vehicular ingress, egress and regress for the benefit of Best Buy Stores,
L.P., recorded June 21, 2005 as Instrument 2005-17544, a copy of which is
attached hereto as Exhibit N; and (iii) Declaration of
Easement conveying an irrevocable non-exclusive easement for foot and vehicular
ingress, egress and regress, recorded June 21, 2005 as Instrument 2005-17545,
a copy of which is attached hereto as Exhibit O.


 


It shall be a condition to Closing that the Title
Company issue to Purchaser a standard ALTA Owner’s Policy of Title Insurance
(the “Title Policy”), in the amount of the Purchase Price, insuring that
fee simple title to the Property is vested in Purchaser, which Title Policy be
issued by the Title Company at standard rates, and without exception for any
items, including the standard exceptions, other than Permitted Exceptions.


 





















 


WOOD - DAMAGING INSECTS.  Seller
agrees to deliver to Purchaser at Seller’s expense a written report from a
licensed exterminating company warranting that there is no active infestation
of any wood - damaging insects visible at the time of the inspection. If wood -
damaging insect infestation and/or damage is discovered, Seller shall correct
the said infestation and/or damage at Seller’s sole cost and expense, or, by
the mutual consent of the parties hereto the Purchase Price hereunder may be
offset by the estimated amount of repair and/or correction of the infestation
and/or damage, the said estimate to be obtained from a reputable contractor and
to be approved by the parties hereto, and in this event, the Purchaser shall
proceed to final Settlement.


 


OPERATIONS
PENDING CLOSING.  From and after the date hereof, Seller shall
continue to operate and maintain the Property between the date hereof and
Settlement in the manner in which the same are currently being operated and
maintained, but in no less than a commercially reasonable fashion, shall
maintain the Property in good condition and repair and will undertake
reasonable commercial efforts to prevent any waste to the Property.


 


From and after the date hereof until the
expiration of the Due Diligence Period, Seller shall advise and consult with
Purchaser regarding any new lease, the modification or amendment of any
existing lease (including any extension thereof), or the termination of any
existing lease, and shall provide Purchaser with complete copies of same, and
Seller shall not apply any tenant’s Security Deposit held as of the date of
this Agreement unless such tenant vacates or is no longer in possession of its
premises as of Settlement.  Seller
acknowledges that Purchaser has advised it of that certain lease entered into
for a portion of the Property to become effective at Closing, a copy of which
is attached hereto as Exhibit P. 
From and after the Due Diligence Period and provided that Purchaser has
not terminated this Agreement, Seller agrees that it will not take any action
which would in any way further encumber the Property, nor will it commence any
action to dispossess or evict any tenant without prior consent of Purchaser or
enter into any new leases or modifications of existing leases without the
written consent of the Purchaser, or enter into any


 





















 


management or service contracts for the
Property unless such contract(s) shall be fully cancelable or terminable prior
to Settlement.


 


Seller shall, from and after the date hereof
perform and discharge all of its duties and obligations and shall otherwise
comply with every covenant and agreement of the landlord or lessor under the
leases.  Furthermore, Seller shall, for
the same period, use diligent and good faith efforts to cause the tenant under
each lease to perform all of such tenant’s duties and obligations and otherwise
to comply with each and even one of such tenant’s covenants and agreements
under such lease and shall enforce the terms and provisions of each such lease.


 


If there shall occur any material adverse
change in the status of any lease prior to Settlement, Purchaser shall, in
addition to any other remedies it may be entitled to hereunder, have the right
to terminate this Agreement and receive a complete refund of the deposits
hereunder, together with interest accrued thereon.  For purposes of the preceding sentence, the
term “material adverse change” shall mean a change which reduces the revenue
derived from a lease by five percent (5%) or more.


 


SELLER’S
REPRESENTATIONS. 
Seller hereby represents and warrants to Purchaser as follows (the “Effective
Date Representations and Warranties”):


 


Seller’s Entity.  Seller is duly organized, validly existing
and in good standing under the laws of its State of organization and is
authorized to do business in the State of Delaware.  The execution and performance of this Agreement
will not violate any term of Seller’s organizational documents, nor any
judicial decree, statute or regulation by which it may be bound or affected.


 


Seller’s Authority.  Seller has full power and authority to enter
into this Agreement and to perform all its obligations hereunder, and has taken
all action required by law, its governing instruments, or otherwise to
authorize the execution, delivery and performance of this Agreement and all the
deeds, agreements, certificates, and other documents contemplated herein.   No consent is required from any party that
has not signed this Agreement in order for Seller to perform its obligations
hereunder.


 





















 


No Conflict or Lien.  To Seller’s knowledge, neither the execution
or delivery of this Agreement nor the consummation of the transactions
contemplated herein will conflict with or result in a breach of any contract,
license or undertaking to which Seller is a party or by which any of the
Property is bound, or constitute a default thereunder or, result in the
creation of any lien or encumbrance upon the Property.  The terms and provisions of this Agreement
and all documents, instruments and certificates made or delivered from time to
time by Seller hereunder constitute valid and legally binding obligations of
Seller enforceable against Seller in accordance with the terms hereof and
thereof.


 


No Proceedings.  No legal or administrative proceeding is (i) pending
or, to Seller’s knowledge, threatened against the Property or (ii) pending
or, to Seller’s knowledge, threatened against Seller, which would adversely
affect the Property or Seller’s right to convey the Property to Purchaser as
contemplated in this Agreement.


 


Leases and Rent Roll.  Seller has delivered to Purchaser a true,
correct and complete copy of each of the Leases and any amendments
thereto.  Exhibit Q contains
a true, correct and complete list of all Leases and there are no leases or
occupancy agreements affecting the Property other as listed on Exhibit Q.
Each Lease is in full force and effect and each tenant listed thereon is open
and operating and Seller has not received any notice of closing, sale or
merger, and is not aware of any bankruptcy or insolvency or threatened
bankruptcy by any tenant.  No person,
other than tenants named in the Leases, has any right of possession of the
Property or any part thereof or any options thereto.  No unexpired rent concessions, diminution of
rent or other credits or similar financial arrangements have been given any tenant.  No other commitments of any kind have been
made to any tenant which are not set forth in the Leases.  Exhibit Q sets forth the full
amount of security held by Seller under each Lease, which amounts are not less
than the amounts deposited by the tenant under each such Lease.  No tenant has asserted or threatened, nor
does Seller have any knowledge of any defense or offsets to rent accruing after
Closing.  No rent has been paid in
advance by any tenant for any period subsequent to Settlement.  There are no claims or disputes or threatened
claims or disputes between any tenant (or any guarantor of any Lease) and
Seller with regard to the Property or with regard to the rent, additional rent,
or any other


 





















 


charges payable under such Lease. 
Seller has fully completed all tenant improvements and repairs specified
in any Lease to be the responsibility of the landlord thereunder.  No default or breach exists on the part of
any tenant and Seller has not received any notice of any default or breach on
the part of the landlord under any Lease which has not been heretofore cured or
satisfied and there does not exist any such default or breach on the part of
the landlord.  Exhibit Q
includes a complete list of any arrearages by tenants with respect to payment
of rent or additional rent or charges which list is true and complete as of the
date hereof.  The Leases and the income
therefrom have not been pledged or assigned by Seller, except in connection
with any financing that will be satisfied by Seller prior to or at Closing.


 


Violations. 
Seller has not received written notice from any governmental body,
authority or agency of, and has no actual knowledge of, any violation of
federal, state or local laws, ordinances, codes, rules or regulations
affecting the Property, including any notice with respect to any Hazardous
Materials (as hereinafter defined) or of any violation of any insurance
requirements relative to the Property, which has not been cured.  Seller has delivered to Purchaser true,
correct and complete copies of all reports and studies dealing with the
environmental condition of the Property (the “Environmental Reports”), which
Environmental Reports are listed on Exhibit R hereto.  Seller has not filed any notice under any
federal or state law indicating past or present treatment, storage or disposal
of any Hazardous Material on the Property, or into the indoor or outdoor
environment of the Property.  As used in
this Agreement, “Hazardous Materials” means hazardous constituents, pollutants
or contaminants including without limitation, petroleum, tremolite,
anthlophylie, actinolite or polychlorinated biphenyls and any other substances
or materials which are included under or regulated by Environmental Laws.  As used in this Agreement, “Environmental
Laws” includes the following: Comprehensive Environmental Response,
Compensation and Liability Act, as amended (“CERCLA”) the Resource Conservation
and Recovery Act, as amended (“RCRA”), the Emergency Planning and Community
Right-to-Know Act of 1986, as amended, the Hazardous Substances Transportation
Act, as amended, the Clean Air Act, as amended, the Toxic Substance Control
Act, as amended, the Safe Drinking Water Act, as amended, the Occupational
Safety and Health Act, as amended,


 





















 


any state superlien and environmental clean-up statutes and all rules and
regulations adopted in respect to the foregoing laws presently in force.


 


Property Contracts.  All Service Contracts affecting the Property
are accurately set forth on Exhibit S hereto.  To the best of its knowledge, Seller is not
in default under any of the Service Contracts, nor is any other party to such
Service Contracts in default thereunder. 
Not later than ten (10) days prior to the date of Closing,
Purchaser shall advise Seller of those Service Contracts that Purchaser wishes
to assume.  Seller shall terminate all
other Service Contracts as of the date of Closing and shall pay all amounts due
thereunder.


 


Bankruptcy. 
There is no bankruptcy, insolvency, reorganization or similar action or
proceeding, whether voluntary or involuntary, pending or to the best of Seller’s
knowledge threatened against Seller.


 


Leasing Commissions.  All leasing commissions or referral fees
attributable to the primary term of all Leases have been or will, by Closing,
be paid in full.  No brokerage or similar
fee shall be due or payable on account of the exercise of, without limitation,
any renewal, extension or expansion options arising under any Leases.


 


Utilities. 
All water, sewer, gas, electric, telephone and other public utilities
and all storm water drainage necessary for the operation of the Property (1) either
enter the Property through open public streets adjoining the Property, or, if
they pass through adjoining private land, do so in accordance with valid public
or private easements or rights of way, and (2) are installed, connected
and operating, with all installation and connection charges paid in full,
including, without limitation, connection and the permanent right to discharge
sanitary waste into the collector system of the appropriate sewer authority.


 


Litigation. 
There is no litigation, arbitration or similar action or proceeding
pending or to the best of Seller’s knowledge threatened against Seller
concerning the Property.


 


At Closing,
Seller shall deliver a completed and signed certificate (the “Certificate
Regarding Representations and Warranties”), dated as of the date of Closing,
containing an update of each of the representations and warranties set forth
herein as of the date of the Certificate Regarding Representations and
Warranties (the “Closing Date Representations and


 





















 


Warranties”).  If the Closing
Date Representations and Warranties are at variance from, or disclose any
information that is at variance from, the Effective Date Representations and
Warranties, or from the information contained in any of the Exhibits annexed
hereto, and Purchaser determines in its reasonable discretion that any such
variance would be reasonably likely to have an adverse effect on the Property
in any material respect or the ability of Seller to consummate the sale of the
Property (provided the applicable variance does not relate to a matter that was
specifically consented to, or agreed to by Purchaser (or deemed approved by
Purchaser hereunder), or expressly permitted in accordance with this
Agreement), then Purchaser shall not be obligated to close and shall have the
right to terminate this Agreement by giving a written notice of termination to
Seller, and the Escrow Agent shall immediately pay the deposits to Purchaser,
and, in which case, Seller shall reimburse Purchaser for the reasonable
out-of-pocket costs actually incurred by Purchaser in anticipation of
consummating the transactions described herein, including, without limitation,
those expenses related to applications to lender for financing of this transaction,
third party inspection reports and title and survey examination, and upon
payment of the foregoing and all rights, duties, and obligations of the parties
shall terminate, other than those rights, duties and obligations that shall
specifically survive termination hereunder,


 


The Effective
Date Representations and Warranties (and all other representations and
warranties made by Seller in this Agreement), the Closing Date Representations
and Warranties and all representations, warranties and certifications contained
in the Seller Estoppel Certificates, this Agreement and any certificate
delivered by Seller to Purchaser pursuant to the terms of this Agreement shall
survive Settlement for a period of six (6) months as to the status of
facts as they exist on Settlement date. 
For the purposes of this paragraph, the terms “representation,” “representations,”
“warranty,” “warranties,” “certification” and “certifications” shall mean the
Effective Date Representations and Warranties (and all other representations or
warranties made in this Agreement), the Closing Date Representations and
Warranties and all representations, warranties and certifications contained in
the Seller Estoppel Certificates, this Agreement or any certificate delivered
by Seller to Purchaser pursuant to the terms of this Agreement.


 





















 


Whenever in
this Agreement a representation of Seller is based on the “Seller’s knowledge”
or words of similar import, such reference shall be deemed to be to the present
actual (as opposed to constructive or imputed) knowledge of Jerry Dunning,
without independent investigation or inquiry of any kind.  There shall be no personal liability to said
individual arising out of said representations or warranties or otherwise.


 


PURCHASER’S REPRESENTATIONS AND
WARRANTIES.  Purchaser hereby represents
and warrants to Seller as follows (the “Effective Date Representations and
Warranties”):


 


Purchaser’s Entity.  Purchaser is duly organized, validly existing
and in good standing under the laws of its State of organization and will, at
Closing, be authorized to do business in the State of Delaware.  The execution and performance of this
Agreement will not violate any term of Purchaser’s organizational documents,
nor any judicial decree, statute or regulation by which it may be bound or
affected.


 


Purchaser’s Authority.  Purchaser has full power and authority to
enter into this Agreement and to perform all its obligations hereunder, and has
taken all action required by law, its governing instruments, or otherwise to
authorize the execution, delivery and performance of this Agreement and all the
deeds, agreements, certificates, and other documents contemplated herein.   No consent is required from any party that
has not signed this Agreement in order for Purchaser to perform its obligations
hereunder.


 


No Conflict or Lien.  To Purchaser’s knowledge, neither the
execution or delivery of this Agreement nor the consummation of the
transactions contemplated herein will conflict with or result in a breach of
any contract, license or undertaking to which Purchaser is a party, or
constitute a default thereunder.  The
terms and provisions of this Agreement and all documents, instruments and
certificates made or delivered from time to time by Purchaser hereunder
constitute valid and legally binding obligations of Purchaser enforceable
against Purchaser in accordance with the terms hereof and thereof.


 





















 


LOSS OR DAMAGE DURING CONTRACT PERIOD.  
At Settlement, Seller shall deliver to Purchaser the Property in the
same condition as exists on the date hereof. 
Seller shall bear the risk of loss or damage to the Property by fire,
windstorm, or other casualty prior to final Settlement. In the event of loss or
damage to any improvements existing on the Property at the date of signing of
this Agreement of Sale by fire or other casualty the cost of which to repair or
replace the said improvements to same condition as existed at the time this
Agreement of Sale was executed by all parties hereto exceeds $500,000, the
Purchaser shall have the option of (i) voiding this Agreement of Sale and
Escrow Agent thereupon shall return to Purchaser all monies paid on account of
the Purchase Price hereunder, together with all interest, if any, accrued
thereon, or, (ii) Purchaser may elect to accept the assignment from Seller
the proceeds from any insurance policy owned by Seller covering the Property,
including business interruption and rent loss insurance, paid or payable on
account of such damage, destruction, casualty or loss, and the Seller paying to
Purchaser at Settlement an amount equal to the full amount of the deductible
applicable under such insurance policies.


 


CONDEMNATION.  The Seller hereby
represents that the Property being purchased hereunder is not now the subject
of any condemnation proceedings begun by any governmental authority or agency
with the power to condemn real property under eminent domain, nor are any such
condemnation proceedings now being contemplated by any of the said governmental
authorities. In the event the Property being purchased hereunder, or any
portion of the Property being purchased hereunder shall be the subject of
condemnation proceedings during the contract period so as to render the
Property, in Purchaser’s sole and absolute discretion, insufficient for
Purchaser’s intended use of the Property, Purchaser may elect to void this
Agreement of Sale whereupon Escrow Agent shall return to Purchaser all monies
paid on account of the Purchase


 





















 


Price hereunder, together with all interest, if any, accrued thereon.
In the event the Property being purchased hereunder, or any portion of the
Property being purchased hereunder shall be the subject of condemnation
proceedings during the contract period such that the Purchaser’s intended use
of the Property shall not be effected, the Purchaser may elect to offset the
Purchase Price hereunder by the amount of the condemnation award, or the
Purchaser may elect to accept the amount of the condemnation award without an
offset of the Purchase Price, and in either of these two events proceed to final
Settlement.


 


ENVIRONMENTAL MATTERS.  Seller
has received no notice and has no reason to believe that the Seller is not in
compliance with all applicable federal, state, and local laws, rules,
regulations, and orders relating to environmental matters affecting the
Property. Neither Seller nor any third party to Seller’s knowledge or with
Seller’s permission has used, generated, manufactured, transported, treated,
stored, handled, or disposed, or conducted any other activity in connection
with or on the Property involving any hazardous waste which would subject
Seller or any owner of the Property to any liability to any governmental
jurisdiction relating to environmental matters. To the best of Seller’s
knowledge, information, and belief, there are no pending or threatened suits or
investigations or orders by governmental authorities relating to environmental
matters.


 


POSSESSION.  The possession of
the Property being purchased hereunder shall be delivered by Seller to
Purchaser at the time of final Settlement as defined herein, excepting that
Seller hereby agrees to allow the Purchaser, or Purchaser’s agent(s), to enter
the Property for the purpose of surveying and performing any other tests
required or reasonably necessitated by the terms and conditions of this
Agreement of Sale prior to final Settlement, provided that such


 





















 


entrance onto the Property takes place during regular business hours,
or at any other time collectively agreeable to Seller, such agreement not to me
unreasonably withheld, delayed or conditioned. 
Purchaser hereby agrees to hold Seller harmless from any liability or
casualty to Purchaser, or Purchaser’s Agents, contractors, subcontractors, or
employees while conducting or performing any of the said tests on the Property.
Further, the Purchaser agrees to repair any and all damage caused by Purchaser’s
testing and return the Property to Seller in exactly the same condition as
Property was prior to the said testing.


 


PURCHASER’S DEFAULT.  In the
event the Purchaser does not proceed to final Settlement as defined herein, and
all of the terms and conditions of this Agreement of Sale have been satisfied
or waived by the parties hereto, after Seller has delivered written notice of
such default to Purchaser and Purchaser has failed to cure such default within
five (5) business days thereafter, then the Seller may, as Seller’s sole
remedy,  void this Agreement of Sale and
Seller shall be entitled to retain Purchaser’s deposit monies, together with
all interest, if any, accrued thereon, as liquidated damages, it being
understood that in no event shall Purchaser be subject to or liable for any
damages or losses in excess of the deposits paid hereunder and Seller hereby
waives its right to bring any action at law for damages (including without limitation
damages allegedly incurred on a loss-of-bargain theory of liability) against
Purchaser, its officers, directors, employees or shareholders by reason of such
default.


 


SELLER’S DEFAULT.  In the event
of a default by Seller in the performance of any of the terms, covenants and
conditions hereof to be performed on the part of the Seller, then, after
Purchaser has delivered written notice of such default to Seller and Seller has
failed to cure such default within five (5) business days thereafter,
Purchaser may, at Purchaser’s option and as


 





















 


Purchaser’s sole remedies, either (a) terminate
this Agreement by notice to such effect to Seller and receive from the Escrow
Agent the deposit monies, together with all interest, if any, accrued thereon,
in which case, Seller shall reimburse Purchaser for the reasonable
out-of-pocket costs to third parties actually incurred by Purchaser in
anticipation of consummating the transactions described herein in an amount not
to exceed $100,000, and upon payment of the foregoing and all rights, duties,
and obligations of the parties shall terminate, other than those rights, duties
and obligations that shall specifically survive termination hereunder, or (b) bring an action in equity for specific performance.


 


NOTICES.  Any notice, election,
or consent required to be given hereunder shall be in writing and shall be
deemed effective upon receipt and to have been properly given if delivered by
hand or sent by United States registered or certified mail, postage prepaid, or
sent by recognized overnight delivery service, addressed to the party for whom
intended as set forth below. 
Notwithstanding the above, notice by fax shall be effective upon receipt
if transmitted prior to 5:00 PM EDT provided a hard copy is sent either by
Registered, Certified Mail, or recognized overnight delivery service for next
day delivery.  The hard copy as a
follow-up to fax need only be sent to counsel for each party.  All notices shall be addressed as follows::


 


	
  To Purchaser :

  	
  Philips East
  Side LLC

  
	
   

  	
  295 Madison
  Avenue

  
	
   

  	
  New York,
  New York 10017

  
	
   

  	
  Attn:                          

  
	
   

  	
  Fax: (212) 545-1100

  
	
   

  	
   

  
	
  With a copy to:

  	
  Seyfarth
  Shaw LLP

  
	
   

  	
  1270 Avenue
  of the Americas, 25th Floor

  
	
   

  	
  New York,
  New York 10020

  
	
   

  	
  Attn:
  Stephen G. Epstein, Esq.

  
	
   

  	
  Fax: (212)
  218-5527

  



 





















 


	
  To Seller :

  	
  DOVER DOWNS, INC

  
	
   

  	
  Mr Timothy Horne, VP Finance

  
	
   

  	
  1131 North DuPont Highway

  
	
   

  	
  Dover, Delaware 19901

  
	
   

  	
   

  
	
  With copies to :

  	
   

  
	
   

  	
  Klaus M. Belohoubek, Esq.

  
	
   

  	
  Senior Vice President - General Counsel

  
	
   

  	
  Dover Downs Gaming & Entertainment, Inc.

  
	
   

  	
  Dover Motorsports, Inc.

  
	
   

  	
  Concord Plaza

  
	
   

  	
  3505 Silverside Road

  
	
   

  	
  Plaza Centre Bldg., Suite 203

  
	
   

  	
  Wilmington, DE 19810

  
	
   

  	
  (302) 475 - 6756

  
	
   

  	
   

  
	
   

  	
  McGINNIS COMMERCIAL REAL ESTATE CO

  
	
   

  	
  James, D McGinnis, Agent

  
	
   

  	
  555 East Loockerman Street

  
	
   

  	
  Dover, Delaware 19901

  



 


or such other address as may be specified from time to time as herein
provided.


 


BROKER.  Purchaser warrants to
Seller that it has dealt with no other brokerage or other persons entitled to a
commission or finder’s fee other than McGINNIS COMMERCIAL REAL ESTATE COMPANY (“Broker”).
Seller warrants to Purchaser that it has dealt with no other brokerage or other
persons entitled to a commission or finder’s fee other than McGINNIS COMMERCIAL
REAL ESTATE COMPANY. Seller agrees to pay McGINNIS COMMERCIAL REAL ESTATE
COMPANY a cash commission equal to three (3%) Percent of the Purchase Price
hereunder at the time of final Settlement from the proceeds of the sale of the
Property. Broker is broker only, and not responsible nor liable for the
performance or non - performance of the parties hereto.


 





















 


AGENCY DISCLOSURE.  The Broker,
any cooperating broker, and any salesperson working with either, are
representing the Seller’s interest and have fiduciary responsibilities to the
Seller, but are obligated to treat both parties fairly. The Broker, any
cooperating broker, and any salesperson working with either, without breaching
the fiduciary responsibilities to the Seller, may, among other services,
provide a potential Purchaser with information about the attributes of
properties and available financing, show properties, and assist in preparing an
offer to purchase. The Broker, any cooperating broker, and any salesperson
working with either, also have the duty to respond accurately and honestly to a
potential Purchaser’s questions and disclose material facts about properties,
submit promptly all written offers to purchase, and offer properties without
unlawful discrimination.


 


MISCELLANEOUS.


 


a. This Agreement of Sale constitutes the entire agreement and
understanding between the parties hereto and supercedes all prior and/or other
agreements and representations, written or oral, in connection with the
purchase contemplated herein.


 


b. It is understood and agreed that this Agreement of Sale may be
amended or modified by mutual agreement of the parties hereto, provided that
such amendment or modification is duly signed by the parties hereto and
incorporated into the terms of this Agreement of Sale.


 


c. This Agreement of Sale shall not be recorded in any public office.


 


d. Any headings preceding the text of the several paragraphs hereof are
inserted only as a matter of reference and convenience for the parties hereto,
and in no way define, limit, or describe the scope or intent of this Agreement
of Sale, nor affect its terms and provisions.


 


e. The singular of any word may denote two or more, the plural one
alone, and the words


 





















 


of one gender may denote another gender whenever appropriate under the
actual circumstances.


 


f. This Agreement of Sale shall be construed under and governed by the
laws of the State of Delaware.


 


g. This Agreement of Sale shall be executed in FIVE (5) counterparts,
each of which when executed shall be deemed as the original. Purchaser shall
retain two (2) counterparts, Seller shall retain two (2) counterparts,
and McGinnis Commercial Real Estate Company shall retain one (1) counterpart.


 


h. The parties hereto agrees to execute and deliver any other
instrument (s) and document (s) that may be necessary or convenient to carry
into effect the provisions of this Agreement of Sale, and the parties agree to
otherwise cooperate in good faith as may be necessary to complete the
Settlement contemplated herein.


 


i. Neither the Purchaser, nor the Seller, nor any broker has made any
deliberate false representations herein.


 


j. This Agreement of Sale shall be binding upon the heirs, executors,
administrators, and assigns of the parties hereto.


 


k. Both parties hereto warrant that they are empowered to execute this
Agreement of Sale binding each party to its respective obligations hereunder.


 


l. Both parties hereto acknowledge that they are entitled to seek legal
advice prior to the execution of this Agreement of Sale, and by executing this
Agreement of Sale each party hereto has affirmed that such legal advice was
obtained.


 


m. If any one or more of the provisions of
this Agreement, or the applicability of any such provision to a specific
situation, shall be held invalid or unenforceable, then such provision shall be
deemed modified to the minimum extent necessary to make it or its application
valid and enforceable, and the validity and enforceability of all other provisions
of this Agreement and all


 





















 


other applications of any such provision shall not be affected thereby.


 


n.                                      Purchaser
shall have the right to effect a deferred or simultaneous exchange transaction,
which will qualify as to Purchaser as a “like-kind exchange under Section 1031
of the Internal Revenue Code of 1986 (the “Code”), by designating one or more
parcels of real property (the “Exchange Property”) as hereinafter set
forth.  Purchaser may retain a third
party (the “Exchange Party”, to whom this Agreement may be assigned by
Purchaser at or immediately prior to Closing) to effect such exchange.  The foregoing provisions with respect to the
Exchange Property are expressly subject to the following terms and conditions:


 


A.                                   In
the event the Exchange Property, or any portion thereof, is designated and/or
Closing thereon is not to occur simultaneously with Closing hereunder, Closing
shall occur as otherwise set forth herein, provided that, in the event that
this Agreement has been assigned to an Exchange Party, Purchaser’s Closing
obligations hereunder shall be performed by such Exchange Party (but without
relieving Purchaser of liability for any non-performance of such obligations);


 


B.                                     Seller
makes no representations or warranties, express or implied, concerning
Purchaser’s qualification for non-recognition of income tax on the like-kind
exchange transaction contemplated hereunder; and


 


C.                                     Purchaser
hereby indemnifies Seller and agrees to hold Seller harmless and defend Seller
from and against any and all claims, actions, demands, costs, expenses, damages
or losses arising out of any transaction relating to the Exchange Property,
which indemnity shall survive Closing and transfer of title to the Property.


 


o.                                      Seller
and Purchaser each hereby waive all rights to a trial by jury and any
claim,  action, proceeding or
counterclaim arising out of or in any way connected with this Agreement.


 


p.                                      In
the event that either party commences suit to recover damages arising from a


 





















 


breach of this Agreement or otherwise to seek enforcement hereof, the
prevailing party shall be entitled to an award of reasonable attorney’s fees,
together with court costs and litigation expenses reasonably incurred and
actually paid.


 


IN WITNESS WHEREOF, the parties hereto have caused this Agreement of
Sale to be executed the day and year written below.


 


	
   

  	
   

  	
  PURCHASER

  
	
   

  	
   

  	
  PHILIPS EAST
  SIDE LLC., a New York limited

  liability company

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  BY:

  	
    /s/ Stephen G. Epstein

  	
  (seal)

  
	
   

  	
   

  	
   

  	
  Stephen G. Epstein, Authorized Signatory

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  SELLER

  
	
   

  	
   

  	
  DOVER DOWNS, INC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  BY:

  	
    /s/ Denis McGlynn

  	
  (seal)

  
	
   

  	
   

  	
  Denis McGlynn, President & CEO