Exhibit 10.428


 


FIRST
AMENDMENT TO PURCHASE AND SALE AGREEMENT 

AND JOINT ESCROW INSTRUCTIONS


 


THIS FIRST AMENDMENT TO PURCHASE AND SALE AGREEMENT AND JOINT ESCROW
INSTRUCTIONS (this “Amendment”) is
entered into as of October 20, 2004 by and between Donahue Schriber Realty
Group, L.P., a Delaware limited partnership (“Seller”),
and Inland Real Estate Acquisitions, Inc., an Illinois corporation (“Buyer”).


 


RECITALS:


 


A.                                   Seller and Buyer entered into that certain
Purchase and Sale Agreement and Joint Escrow Instructions dated as of September 2,
2004 (the “Agreement”;
capitalized terms used but not defined in this Amendment shall have the
meanings given to them in the Agreement) with respect to the property known as
Plaza at River Lakes located in Bakersfield, California.


 


B.                                     Seller and Buyer now desire to acknowledge
certain matters with respect to the Agreement, and to amend the Agreement, as
set forth herein.


 


NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, Buyer and Seller agree as follows with respect to the
Agreement:


 


1.             Waiver of
Contingencies; Reduction of Purchase Price; Coldwell Banker Credit.  October 20, 2004 is acknowledged to be the
Decision Date, and Buyer’s execution and delivery of this Amendment (effective
upon receipt of a faxed counterpart executed by Seller) constitutes Buyer’s
waiver of all rights to terminate the Agreement (i) on or before the Decision
Date, or (ii) in accordance with Section 4.7 of the Agreement (Buyer hereby
acknowledges it has received and approved estoppels from the Majors as well as
Minors occupying at least 75% of the remaining leased space at the Property not
occupied by the Major).  Seller hereby
confirms it shall deliver Seller Estoppels as required by the last sentence of
Section 4.7 of the Agreement.  The
Purchase Price is hereby reduced by the sum of $400,000.00 and accordingly is
the sum of Seventeen Million Dollars ($17,000,000.00).  Seller agrees that, at Closing, Seller shall
provide Buyer with a credit against the Purchase Price in the amount of $92,338.00
(less any amount thereof allocable to the period prior to Closing), by reason
of prepaid rent paid to Seller by Coldwell Banker, plus a credit against the
Purchase Price in the amount of the Monthly Smoothie Rent allocable to the
period from the Closing Date through October 30, 2004, plus a credit against
the Purchase Price in the amount of the Monthly Quick One Rent allocable to the
period from the Closing Date through November 30, 2004.


 


2.                                       Escrow
for Planet Smoothie.  Seller has
entered into a lease (the “Smoothie Lease”)
dated July 14, 2004 with Addis Enterprises, Inc. (“Smoothie”) covering a portion of the Property
as more particularly described therein (the “Smoothie Premises”).  Smoothie has not yet finished its tenant
improvements as required by the Smoothie Lease nor has Smoothie obtained the
certificate of occupancy to be issued by the City of Bakersfield (the “Smoothie
Certificate”) upon Smoothie’s


 


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completion
of such tenant improvements.  Pursuant to
the Smoothie Lease, Seller is obligated to pay $19,500 to Smoothie for tenant
improvements (the “Smoothie TIs”), and $5,215 to the broker owed the same (the “Broker”) for leasing commissions (the “Smoothie  Commissions”) Pursuant to the Smoothie Lease,
commencing November 1, 2004 Smoothie is obligated to pay to the landlord
thereunder the sum of $2,459 per month for base tent and $653.12 per month for
estimated operating expenses (the sum of the foregoing amounts, being
$3,112.12, is herein called the “Monthly Smoothie Rent”).  At
Closing, Seller shall deposit into escrow, with Escrow Holder, the sum of
$56,018.16 (“Smoothie Escrowed Funds”) with
respect to the Smoothie Lease (said sum equals the product of the Monthly
Smoothie Rent times eighteen (18), plus the Smoothie TIs and plus the Smoothie
Commission).  The Smoothie TI’s (or the
applicable portion thereof) shall be released to Buyer (for immediate release
to Smoothie) upon Buyer’s delivery of Buyer’s written certification (“Buyer’s
Smoothie Certification”) to
Seller and Escrow Holder that Smoothie is entitled to the Smoothie TIs (or the
specified portion thereof) pursuant to Article VII of Exhibit B to the
Smoothies Lease.  The Smoothie Commission
shall be disbursed by Escrow Holder to Broker upon receipt of Buyer’s Smoothie
Certification.  If Smoothie shall not
have paid the Monthly Smoothie Rent due for November 2004 prior to November 8,
2004, commencing November 8, 2004,, and on the same day of each month
thereafter until the earlier of (i) the date Smoothie shall have commenced
paying the Monthly Smoothie Rent, or (ii) the date of the issuance of the
Smoothie Certificate and the date Smoothie shall have taken possession of the
Smoothie Space (whichever is later), the Smoothie Monthly Rent shall be
promptly disbursed to Buyer from the Escrowed Funds upon Buyer’s delivery of
written certification to Escrow Holder and Seller that Smoothie has not yet
paid the Smoothie Monthly Rent then due.  In the event that, after Buyer shall have been
paid the Smoothie Monthly Rent (or any portion thereof) out of the Smoothie
Escrowed Funds for any particular month, Buyer should receive payment of all or
any portion of the Smoothie Monthly Rent from Smoothie for such month, Buyer
shall immediately remit the same to Seller.  Upon the later to occur of (i) issuance of the
Smoothie Certificate, and (ii) the date Smoothie commences paying the Monthly
Smoothie Rent (Buyer agrees to enforce the Smoothie Lease with respect thereto),
the Smoothie Escrowed Funds still being held by Escrow Holder and not
previously disbursed by Escrow Holder pursuant to this Section 3 shall be
promptly disbursed to Seller.  Buyer
agrees to notify Seller in writing promptly upon Buyer acquiring knowledge of
the issuance of the Smoothie Certificate and promptly upon Smoothie taking
possession of the Smoothie Space and payment of the Smoothie Monthly Rent.


 


3.                                       Escrow for Quick One.  Seller
has entered into a lease (the “Quick One Lease”)
dated May 21, 2004 with Anher Corporation (“Quick One”) covering a portion of the Property
as more particularly described therein (the “Quick One Premises”).  Quick
One has not yet finished its tenant improvements as required by the Quick One
Lease nor has Quick One obtained the certificate of occupancy to be issued by
the City of Bakersfield (the “Quick One Certificate”) upon Quick One’s completion of such
tenant improvements.  Pursuant to the
Quick One Lease, Seller is obligated to pay $21,000 to Quick One for tenant improvements
(the “Quick
One TIs”), and $3,750 to the broker owed such amount for
leasing commissions (the “Quick One Commissions”), Pursuant to the Quick One Lease,
commencing November 1, 2004 Quick One is obligated to pay to the landlord
thereunder the sum of $2,505 per month for base rent and $720,000 per month for
estimated operating expenses (the sum of the foregoing amounts, being
$3,225.00, is herein called


 


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the “Monthly Quick One Rent”).  At Closing, Seller shall deposit into escrow,
with Escrow Holder, the sum of $58,050.00 (the “Quick One
Escrowed Funds”) with respect to the Quick One Lease (said sum
equals the product of the Monthly Quick One Rent times eighteen (18), plus the
Quick One TIs and plus the Quick One Commission).  The Quick One TI’s (or the applicable portion
thereof) shall be released to Buyer (for immediate release to Quick One) upon
Buyer’s delivery of Buyer’s written certification (“Buyer’s
Quick One Certification”) to Seller and Escrow Holder that Quick One
is entitled to the Quick One TIs (or the specified portion thereof) pursuant to
Article VII of Exhibit B to the Quick Ones Lease.  The Quick One Commission shall be disbursed by
Escrow Holder to Broker upon receipt of Buyer’s Quick One Certification.  If Quick One shall not have paid the Monthly
Quick One Rent due for December 2004 prior to December 8, 2004,
commencing December 8, 2004, and on the same day of each month thereafter
until the earlier of (i) the date Quick One shall have commenced paying the
Monthly Quick One Rent, or (ii) the date of the issuance of the Quick One
Certificate and the date Quick One shall have taken possession of the Quick One
Space (whichever is later), the Quick One Monthly Rent shall be promptly disbursed
to Buyer from the Escrowed Funds upon Buyer’s delivery of written certification
to Escrow Holder and Seller that Quick One has not yet paid the Quick One
Monthly Rent then due.  In the event
that, after Buyer shall have been paid the Quick One Monthly Rent (or any
portion thereof) out of the Quick One Escrowed Funds for any particular month.  Buyer should receive payment of all or any
portion of the Quick One Monthly Rent from Quick One for such month, Buyer
shall immediately remit the same to Seller.  Upon the later to occur of (i) issuance of the
Quick One Certificate, and (ii) the date Quick One commences paying the Monthly
Quick One Rent (Buyer agrees to enforce the Quick One Lease with respect
thereto), the Quick One Escrowed Funds still being held by Escrow Holder and
not previously disbursed by Escrow Holder pursuant to this Section 4 shall
be promptly disbursed to Seller.  Buyer
agrees to notify Seller in writing promptly upon Buyer acquiring knowledge of
the issuance of the Quick One Certificate and promptly upon Quick One taking
possession of the Quick One Space and payment of the Quick One Monthly Rent.


 


5.                                       Holdback
for Cingular Wireless.  Seller has
entered into a Site Access Telecommunications License Agreement Ground Space
Site (the “Cingular Lease”) dated October 8,
2004 with Pacific Bell Wireless, LLC (“Cingular”) with
respect to the Property.  Pursuant to the
Cingular Lease, commencing the “Commencement Date” (as defined in the Cingular
Lease), Cingular is obligated to pay to the landlord thereunder the sum of
$1,750 per month (the “Monthly Cingular Rent”).
 Seller and Buyer acknowledge that
Cingular may not have obtained the governmental permits (the “Permits”) required to operate its business pursuant to the
Cingular Lease prior to the Closing.  At
Closing, Seller shall deposit into escrow, with Escrow Holder, the sum of
$284,037.11 (the “Cingular Escrowed Funds”)
with respect to the Cingular Lease (the Purchase Price payable by Buyer shall
be the source of the Cingular Escrowed Funds).  Upon written confirmation from Cingular that
it has obtained the Permits (if Cingular refuses to confirm in writing that
Cingular has obtained the Permits, Cingular’s commencement of its business
operations on the Property pursuant to the Cingular Lease shall be deemed
Cingular’s written confirmation that it has obtained the Permits), the Cingular
Escrowed Funds shall be released to Seller.  Buyer and Seller agree to exert diligent good
faith efforts to obtain such written confirmation.  If Cingular terminates the Cingular Lease
pursuant to Section 16.10 thereof prior to the release of the Cingular
Funds to


 


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Seller,
upon such termination the Cingular Escrowed Funds shall be delivered to Buyer.  Prior to release of the Cingular Escrowed
Funds to Seller, all Monthly Cingular Rent paid to Buyer shall be promptly
remitted to Seller.


 


6.                                       Agreement in Effect.  The
terms and provisions of this Amendment shall control over any inconsistent
terms and provisions of the Agreement.  Except as amended hereby, the parties
acknowledge and agree that the Agreement is in full force and effect in
accordance with its terms.  If required
by Escrow Holder, Buyer and Seller shall enter into a separate escrow agreement
with Escrow Holder to implement the post-Closing elements of this Amendment,
provided such escrow agreement is not in conflict with this Amendment.  This Amendment may be executed in
counterparts, each of which shall be an original and both of which, together,
shall constitute one and the same instrument.


 


SIGNATURES ON NEXT PAGE


 


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IN WITNESS WHEREOF, the parties
have duly executed this Amendment as of the day and year first above written.


 


	
  SELLER:

  	
  Donahue
  Schriber Realty Group, L.P., a Delaware limited

  partnership

  
	
   

  	
   

  
	
   

  	
  By:
  Donahue Schriber Realty Group, Inc., a Maryland

  corporation its general partner

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Patrick S. Donahue

  
	
   

  	
   

  
	
   

  	
  Name:

  	
   Patrick S. Donahue

  
	
   

  	
   

  
	
   

  	
  Title:

  	
   President

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Dirk Van Wyk

  
	
   

  	
   

  
	
   

  	
  Name:

  	
   Dirk Van Wyk

  
	
   

  	
   

  
	
   

  	
  Title:

  	
   Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
  BUYER:

  	
  Inland
  Real Estate Acquisitions, Inc., an Illinois corporation

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Karen M. Kautz

  
	
   

  	
   

  
	
   

  	
  Name:

  	
   Karen M. Kautz

  
	
   

  	
   

  
	
   

  	
  Title:

  	
   Vice President

  
							



 


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PURCHASE AND SALE AGREEMENT 

AND JOINT ESCROW INSTRUCTIONS


 


THIS PURCHASE AND SALE AGREEMENT AND JOINT ESCROW
INSTRUCTIONS (this “Agreement”) is
entered into as of September 2, 2004 by and between Donahue Schriber
Realty Group, L.P., a Delaware limited partnership (“Seller”),
and Inland Real Estate Acquisitions, Inc., an Illinois corporation (“Buyer”).


 


RECITALS:


 


A.                                   Seller is the owner of certain real property
improved as a retail center known
as Plaza at River Lakes located in Bakersfield, California.


 


B.                                     Buyer desires to purchase that property, and
Seller desires to sell that property, on the terms and conditions contained in
this Agreement.


 


NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained in this Agreement, Buyer and Seller agree as follows:


 


1.  PURCHASE
AND SALE


 


1.1  Agreement to Buy and Sell.
 Subject to all of the terms and
conditions of this Agreement, Seller hereby agrees to sell and convey to Buyer
and Buyer hereby agrees to acquire and purchase from Seller the following
(collectively, the “Property”):


 


1.1.1  All of Seller’s right, title and interest in
and to that certain parcel of real property described on) Exhibit “A”
attached hereto, together with all of Seller’s rights, privileges and easements
appurtenant thereto (collectively, the “Land”);


 


1.1.1  All of Seller’s right, title and interest in
and to all improvements, structures, equipment and fixtures located on or under
the Land (collectively, the “Improvements”)
(the Land and Improvements are herein collectively called the “Project”);


 


1.1.2  All of Seller’s right, title and interest in
and to all tangible personal property, if any, located on or affixed to the
Project and used in connection with the ownership, operation, use or maintenance
of the Project, and all intangible property, if any, owned or held by Seller
that pertains to the ownership, maintenance, use or operation of the Project,
including but not limited to the Project’s name (collectively, the “Personal Property”);


 


1.1.3  All of Seller’s interest in any leases or
other agreements demising space in or providing for the use or occupancy of any
portion of the Project (collectively, the “Leases”); and


 


1.1.4  All of Seller’s right, title and interest in
and to any and all service contracts, maintenance agreements, warranties,
guaranties, permits and licenses and other contracts and agreements relating to
the Property, if any, which continue in full force and effect beyond the


 


1





















 


“Closing” (as defined below) (collectively, the “Contracts”), to the extent the Contracts are assignable.  The Property does not include cash, any
insurance claims (except to the extent Section 4.5 is applicable), or any
other claims against third parties.


 


1.2  Purchase Price.  The purchase price to be paid by Buyer to
Seller for the Property shall be the sum of Seventeen Million Four Hundred
Dollars ($17,400,000) (the “Purchase Price”).


 


1.3  Payment of Purchase Price.  The
Purchase Price shall be payable as follows:


 


1.3.1  Within
two (2) business days after the “Effective Date” (as defined below), Buyer
shall deliver to Stewart Title Insurance Company (“Escrow
Holder” or the “Title Company”),
in immediately available funds, the sum of Four Hundred Thousand Dollars ($400,000)
(said sum, together with any interest earned thereon while held by Escrow
Holder, is herein called the “Deposit”).  Escrow Holder shall deposit the Deposit into
an interest-bearing account satisfactory to Buyer pending disbursement in
accordance with the terms of this Agreement.  Unless Buyer terminates this Agreement by
delivery of written notice of termination (the “Termination
Notice”) to Seller and Escrow Holder on or before the date (the “Decision Date”) that is thirty (30) days after the Effective
Date, the Deposit shall be non-refundable after the Decision Date, except in
the event of Seller’s material default and except as otherwise expressly herein
provided, and shall be applied to the Purchase Price at Closing.


 


1.3.2  Not
later than 10:00 am Pacific time on the “Closing Date” (as defined below), Buyer
shall deposit into Escrow, by wire transfer of federal funds, the balance of
the Purchase Price, subject to adjustment by reason of any applicable
prorations and the allocation of closing costs described below.


 


2.  OPENING
OF ESCROW


 


2.1  Escrow; Escrow Holder.  Within
two (2) business days after Seller shall have executed this Agreement, Seller
shall open an escrow (the “Escrow”) with
Escrow Holder at 505 N.  Brand Blvd.,
Ste. 800, Glendale, CA 91203, Attn: Josette Loaiza, by delivering an executed
copy of this Agreement to Escrow Holder.  The date the Escrow is opened pursuant to the
preceding sentence is herein called the “Effective Date”.
 Escrow Holder shall promptly advise
Buyer and Seller of the Effective Date.


 


2.2  Escrow Instructions.  The
terms and conditions set forth in this Agreement shall constitute both an
agreement between Seller and Buyer and escrow instructions for Escrow Holder.  Seller and Buyer shall promptly execute and
deliver to Escrow Holder any separate or additional escrow instructions
requested by Escrow Holder that are consistent with the terms of this
Agreement.  Any separate or additional
instructions shall not modify or amend the provisions of this Agreement unless otherwise
expressly set forth by mutual consent of Buyer and Seller.  As
used in this Agreement, “Closing” shall
mean the recordation (or the commitment of the Title Company to do so to the satisfaction
of Buyer) of the “Deed” (as defined below) in the Official Records of Kern
County, California and the payment of the Purchase Price to Seller.


 


2.3  Closing Date.  Escrow
shall close on or before the date (the “Closing Date”)
that is thirty-five (35) days after the Effective Date.


 


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3.  ACTIONS PENDING CLOSING 


 


3.1  Buyer’s Review of Title.


 


3.1.1  Seller
shall cause the Title Company, promptly after the Effective Date, to deliver to
Buyer a copy of a current preliminary title report or commitment for title insurance
(as well as a copy of each exception referenced therein) showing the condition
of title to the Property (the “Title Report”).  Upon receipt from Buyer of funds sufficient
to pay for a survey of the Property, Seller shall engage a surveyor to prepare
a survey of the Property (the “Survey”) that meets
the requirements set forth on Schedule 3.1.1 hereof.  Seller is ordering the Survey as an accommodation
to Buyer, and in no event shall Seller be in breach or default by reason of the
contents, or timing of delivery, of the Survey.


 


3.1.2  Buyer
shall have until the later of five (5) days after receipt of the Title Report and
Survey or twenty five (25) days after the Effective Date ((the “Title Date”) within which to deliver to Seller written
notice of Buyer’s disapproval of title as shown on the Title Report and Survey
(those title matters identified on the Title Report and Survey and timely
disapproved in writing by Buyer are hereafter called the “Disapproved
Exceptions”).  Buyer’s failure
to deliver such notice to Seller on or before the Title Date shall constitute
Buyer’s approval of the condition of title as shown on the Title Report and Survey.


 


3.1.3  Seller
shall notify Buyer in writing within three (3) business days after Seller’s receipt
of Buyer’s notice of Disapproved Exceptions that: (a) Seller will remove such
Disapproved Exceptions from title as of or before Closing; or (b) Seller will
not remove any or certain specified Disapproved Exceptions from title.  Seller’s failure to address any Disapproved
Exceptions in any notice, or failure to give a notice as to any Disapproved
Exceptions, shall constitute Seller’s statement that it will not remove such
Disapproved Exceptions from title.


 


3.1.4  If
Seller does not provide Buyer with written notice that it shall remove all Disapproved
Exceptions from title, Buyer shall have the right to terminate this Agreement
by delivery of written notice of termination in accordance with Section 3.3
on or before the Decision Date, as Buyer’s sole and exclusive remedy.  Buyer’s failure to provide such notice of
termination on or before the Decision Date shall constitute Buyer’s waiver of
its disapproval of the Disapproved Exceptions.  In the case of Buyer’s waiver (or deemed
waiver) of Disapproved Exceptions, Seller shall have no obligation to remove or
otherwise address such Disapproved Exceptions from title, and such waived
Disapproved Exceptions shall be deemed approved.  If Buyer elects to terminate this Agreement
pursuant to this Section 3.1.4, the provisions of Section 3.3 shall
apply.  Except for the Disapproved
Exceptions Seller removes or covenants to remove, the exceptions to title shown
by the Title Report and Survey and any encumbrance arising from the acts of
Buyer are called the “Permitted Exceptions”
in this Agreement.  In no event shall any
mortgage or judgment liens be Permitted Exceptions, and Seller shall cause the
same to be removed at or before Closing.  Should a supplemental Title Report be issued
by the Title Company after the date of the original Title Report disclosing
additional title exceptions that adversely affect the condition of title to the
Property, then the Title Date shall, if applicable, be extended to the date
that is three (3) business days after Buyer’s receipt of the supplemental Title
Report, and if necessary, the Closing Date shall be automatically


 


3





















 


extended to the extent necessary to accommodate the
approval procedures of Section 3.1.3 and this Section 3.1.4.


 


3.2  Buyer’s Review of the
Property; Agreements.  Promptly after
the Effective Date, Seller shall provide Buyer with copies of (or make
available to Buyer for review at the Project) the items reflected on Schedule 3.1
attached hereto (collectively, the “Due Diligence Documents”).
 Notwithstanding the foregoing or any
other provision hereof to the contrary, (i) Seller’s responsibility to provide
Due Diligence Documents shall be limited to those Due Diligence Documents in
Seller’s (or its property manager’s) possession (without limiting the
foregoing, those items that are marked “not in our possession” on Schedule 3.1
shall not be provided), (ii) Seller shall not be required to generate reports
or analyses not typically prepared (or reflecting information not typically
reflected) in Seller’s ordinary course of business, and (iii) the Due Diligence
Documents are provided as an accommodation to Buyer and Seller expressly
disclaims any and all representations and warranties regarding the same.  On or before the Decision Date, Buyer shall have
reviewed the foregoing and prepared, obtained, reviewed (or shall have chosen
not to have prepared, obtained or reviewed) and approved, among other things,
all other reports of investigations of the Property, including, such soil,
environmental, geological and engineering tests and reports, and other
inspections of the Property as Buyer shall deem necessary in order to determine
whether the Property is suitable for Buyer’s intended use, as well as
investigated (or chosen not to have investigated) all zoning requirements,
federal, state and local laws, ordinances, rules, regulations, permits,
licenses, approvals and orders applicable to the Property.  Pursuant to and subject to the requirements of
Section 3.5 of this Agreement, Buyer may enter onto the Property for the
purpose of conducting its inspection (the “Inspection”) of
the Property; provided, however, without first obtaining Seller’s prior written
consent, which consent will not be unreasonably withheld, Buyer shall only
conduct a visual inspection, with no right to conduct any physical testing,
boring, sampling or removal (collectively “Physical Testing”)
of any portion of the Property.  If Buyer
wishes to conduct any Physical Testing of the Property, Buyer shall submit a
work plan to Seller prior to the Decision Date for Seller’s prior written
approval, which work plan Seller may modify, limit or disapprove in its
reasonable discretion.  If, on the basis
of the review and the Inspection described in this Section 3.2, or if for
any other reason or no reason, Buyer determines that the Property is not
suitable for Buyer’s intended use, then Buyer may terminate this Agreement by delivering
the Termination Notice to Seller and Escrow Holder on or before the Decision
Date.  Buyer’s failure to deliver the
Termination Notice to Seller and Escrow Holder on or before the Decision Date
shall constitute Buyer’s approval of the aforementioned items and of the
condition of the Property.


 


3.3  Buyer’s Termination.  If Buyer elects to terminate this Agreement in
accordance with Sections 3.1.4 or 3.2, Buyer shall deliver the Termination
Notice to Seller and Escrow Holder on or before the Decision Date.  If Buyer elects to terminate this Agreement in
accordance with Sections 4.4 or 4.5, then on or before the dates specified
therein, Buyer shall deliver a Termination Notice to Seller and Escrow Holder
that Buyer elects to terminate this Agreement pursuant to said Sections.  Buyer’s failure to timely deliver such
termination notice pursuant to said Sections of this Agreement shall constitute
Buyer’s waiver of Buyer’s right to terminate this Agreement pursuant to said Sections.
 If Buyer timely elects to terminate this
Agreement pursuant to Sections 3.1.4, 3.2, 4.4 or 4.5, Escrow Holder shall
deliver the Deposit to Buyer, less fifty percent (50%) of any Escrow termination
fee, and Escrow Holder shall return to the depositor thereof any other
materials


 


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previously placed in Escrow and remaining in Escrow; and neither party
shall thereafter have any further rights or obligations under this Agreement
unless expressly provided otherwise herein.


 


3.4  No Processing.  Without Seller’s prior written consent, until
the Closing, Buyer shall not make any application to any governmental agency
for any permit, approval, license or other entitlement for the Property or the
use or development thereof.


 


3.5  Access to Property.


 


3.5.1  Subject
to the rights of existing tenants of the Property (“Tenants”),
whom Buyer hereby agrees not to interview or question without having provided
Seller and Seller’s Broker (as defined below) with at least 24 hours prior
written notice of its intention to do so during such interview, Seller hereby
grants to Buyer and Buyer’s representatives, agents, employees and contractors
(collectively, “Buyer’s Agents”) a nonexclusive
license to enter onto the Property solely for the purpose of conducting Buyer’s
Inspection.  Any Inspection work shall be
at the sole cost and expense of Buyer.  The
license created under this Section 3.5.1 shall expire on termination of
this Agreement.  At least forty-eight
(48) hours prior to any entry and Inspection, Buyer shall provide Seller with
sufficient evidence to show that Buyer and Buyer’s Agents, who are to enter
upon the Property, are adequately covered by policies of insurance issued by a
carrier reasonably acceptable to Seller insuring Buyer and Seller against any
and all liability arising out of Buyer’s or Buyer’s Agents’ entry upon and
Inspection of the Property, including without limitation any loss or damage to
the Property, with coverage in the amount of not less than $1,000,000 per
occurrence.


 


3.5.2  Buyer
agrees to keep the Property free from any liens arising out of any work performed,
materials furnished or obligations incurred by or on behalf of Buyer or Buyer’s
Agents with respect to any Inspection or Physical Testing of the Property.  If any such lien shall at any time be filed,
Buyer shall cause the same to be discharged of record within twenty (20) days thereafter
by satisfying the same or, if Buyer in its discretion and in good faith
determines that such lien should be contested, by recording a bond.  Failure by Buyer to discharge such lien shall
be a material breach of this Agreement and Seller may terminate this Agreement
by written notice thereof to Buyer.


 


3.5.3  Buyer
shall, at its sole cost and expense, comply with all applicable federal, state and
local laws, statutes, rules, regulations, ordinances, or policies in conducting
the Inspection and the Physical Testing.


 


3.5.4  Buyer
hereby agrees to hold harmless, protect, defend and indemnify, and hereby releases,
Seller and its trustees, officers, directors, employees, contractors, agents,
subsidiaries and affiliates, and its and their respective successors and
assigns (collectively, the “Indemnitees”)
and the Property from and against any and all claims, demands, causes of
action, losses, liabilities, liens, encumbrances, costs or expenses (including
without limitation reasonable attorneys’ fees and litigation costs) arising out
of, connected with or incidental to: (a) any injuries to persons (including death)
or property (real or personal), or (b) any mechanics’, workers’ or other liens
on the Property, by reason of or relating to the work or activities conducted
on the Property by Buyer or Buyer’s Agents.  The provisions of this Section 3.5.4
shall survive any termination of this Agreement and shall not be limited in any
way by any other terms of this Agreement.


 


5





















 


3.5.5  In no event shall Buyer or
Buyer’s Agents have the right to place any materials or equipment on the
Property (including, without limitation, signs or other advertising material)
until after the Closing has occurred.


 


3.5.6  Buyer
shall, at its sole cost and expense, clean up and repair the Property, in whatever
manner necessary, after Buyer’s or Buyer’s Agents’ entry thereon so that the
Property shall be returned to the same condition that existed prior to Buyer’s
or Buyer’s Agents’ entry thereon.


 


4.  ADDITIONAL
AGREEMENTS OF THE PARTIES


 


4.1  Seller’s Representations
and Warranties.  Seller hereby
represents, warrants and covenants to and agrees with Buyer as follows:


 


4.1.1  Seller
has the legal right, power and authority to own the Property and to enter into
and consummate the transactions contemplated by this Agreement, and this
Agreement and all instruments, documents and agreements to be executed by
Seller in connection herewith are, or when delivered shall be, duly authorized,
executed and delivered by Seller and are, or when delivered shall be, valid,
binding and enforceable obligations of Seller.


 


4.1.2  There
are no pending or, to Seller’s knowledge, threatened legal proceedings, administrative
actions, or pending governmental investigation of any kind or character
adversely affecting the Project or Seller’s interest therein.


 


4.1.3  To
Seller’s knowledge and except as may be disclosed in the Due Diligence Documents,
Seller has received no written notice from any government authority of any
violation of any statute, ordinance, code or regulation with respect to the
Project, which violation has not been corrected.


 


4.1.4  To
Seller’s knowledge and except as may be disclosed in the Due Diligence Documents,
Seller has received no written notice that the Project is in violation of any
federal, state and local laws, ordinances and regulations applicable to the
Project with respect to “Hazardous Materials” (as defined below), nor to Seller’s
knowledge have any Hazardous Materials been or are currently being produced,
disposed of, used or stored on or under the Property in violation of applicable
law.


 


4.1.5  Seller
is not required to obtain any consents or approvals to consummate the transactions
contemplated in this Agreement.


 


4.1.6  To Seller’s
knowledge, the copies of the Leases and Contracts delivered to Buyer (or made
available to Buyer) for its review are true and correct copies of the Leases
and Contracts and are all of the Leases and Contracts affecting the Property.


 


4.1.7  As used
herein, “to Seller’s knowledge” and phrases of
similar import means the actual (not constructive and without attribution)
conscious knowledge, without undertaking, and without any duty to undertake,
any investigation or inquiry, of Deborah Hawthorne and Dirk Van Wyk, which
individuals are the employees of Seller (or its affiliates) with the
operational/asset


 


6





















 


disposition responsibility for the Project.  It is expressly agreed and understood that in
no event shall Buyer be entitled to bring any action(s) for damages or
otherwise against such individuals.  In
the event Seller or Buyer
should become aware of any facts or circumstances prior to the Closing Date that should render any of Seller’s
representations and warranties that are limited to Seller’s knowledge no longer
accurate, the party first becoming so aware shall promptly notify the other
party Buyer in writing, and Buyer shall have the right, as its sole and
exclusive remedy, to terminate this Agreement by written notice to Seller and
Escrow Holder delivered within seven (7) days after receipt of Seller’s notice
or first becoming aware of such facts, in which case this Agreement shall
terminate in accordance with Section 3.3.  This Section 4.1.7 shall supersede any
inconsistent provision of this Agreement.


 


4.2  Buyer’s Representations and Warranties.  Buyer
hereby represents, warrants and covenants to and agrees with Seller as follows:


 


4.2.1  Buyer’s
Investigation and Release.  (a) Buyer acknowledges that, except as explicitly
set forth herein, there are no representations or warranties of any kind
whatsoever, express or implied, made by Seller in connection with this
Agreement, the purchase of the Property by Buyer, the Contracts, the Leases,
the physical condition of the Property or whether the Property complies with
applicable laws or is appropriate for Buyer’s intended use; (b) prior to the
Decision Date Buyer shall have (or shall have chosen not to have) fully
investigated the Property (including the Leases and Contracts) and all matters
pertaining thereto; (c) Buyer is not relying on any statement or representation
of Seller, its agents or its representatives nor on any information supplied by
Seller, its agents or its representatives; (d) Buyer, in entering into this
Agreement and in completing its purchase of the Property, is relying, and shall
rely, entirely on its own investigation of the Property based on its extensive
experience in and knowledge of real property in the areas where the Property is
located; (e) Buyer is aware (or has chosen not to be aware) of all zoning
regulations, other governmental requirements, legal, site and physical
conditions, and other matters affecting the use and condition of the Property;
(f) Buyer’s decision to purchase the Property on the terms and conditions
hereof has been, and at all times shall be, made solely and exclusively in
reliance on Buyer’s own review, inspection and investigation of the Property
(including the Leases and Contracts) and of materials, documents, information
and studies relating to the Property; (g) BUYER
SHALL PURCHASE THE PROPERTY IN ITS “AS IS” CONDITION AS OF
THE DATE OF CLOSING.  Without limiting the foregoing,
Buyer acknowledges that Buyer has accepted full responsibility for assuring the
Property complies at Closing with all applicable laws, rules, regulations,
orders and ordinances, and in the event any such laws, rules, regulations,
orders or ordinances impose any pre-Closing obligations upon Seller, Seller
shall have the right to (i) perform the same at Buyer’s expense and the cost
thereof shall be added to the Purchase Price at Closing, if Seller is obligated
by law to perform the same prior to Closing, and/or (ii) require Buyer to
execute and deliver at Closing any documentation requested by Seller or
required by governmental authorities confirming Buyer has accepted such
responsibility and indemnifying Seller against the same.


 


4.2.2  Authority.  Buyer has the power and authority to own the
Property and to consummate the transactions contemplated by this Agreement.  This Agreement and all instruments, documents
and agreements to be executed by Buyer in connection herewith are or when
delivered shall be duly authorized, executed and delivered by Buyer and are
valid, binding and enforceable


 


7





















 


obligations of Buyer.  Each individual executing this Agreement on
behalf of Buyer represents and warrants to Seller that he or she is duly
authorized to do so.


 


4.2.3  Consents.  Buyer is not required to obtain any consents
or approvals to consummate the transactions contemplated in this Agreement.


 


4.3  Reaffirmation.  The representations and warranties of Seller
and Buyer set forth in Sections 4.1 and 4.2 are true and correct as of the date
of this Agreement and shall be true and correct as of the Closing.  The Closing shall constitute each party’s
reaffirmation of those representations and warranties as of the Closing, and
each party shall execute and deliver at Closing a document (a “Reaffirmation Certificate”) reaffirming such representations
and warranties.


 


4.4  Condemnation.
 If, prior to Closing, any portion of the
Property shall be condemned or become the subject of any pending or threatened
condemnation action, Seller shall promptly notify Buyer thereof.  This Agreement shall remain in full force and
effect, regardless of such condemnation or threatened or pending action, and if
any condemnation award is received by Seller prior to Closing, the amount of
such award shall be applied as a credit against the Purchase Price.  Any condemnation awards received by Seller on
or after Closing shall be promptly delivered by Seller to Buyer.  Notwithstanding the foregoing, in the event
such condemnation involves 5% or more of the Land or the Improvements or
affects any of the existing access points to the Property, Buyer shall be
entitled to terminate this Agreement by written notice thereof to Seller given
within five (5) business days after Buyer shall have been notified of such
condemnation, whereupon the Deposit (to the extent previously delivered to
Escrow Holder) shall be returned to Buyer.  Buyer’s failure to timely deliver such notice
to Seller within such five (5) business day period shall constitute Buyer’s
election to proceed to Closing.


 


4.5  Damage
or Destruction.  In the event of any
damage to or destruction of the Property prior to the Closing, Seller shall
promptly notify Buyer thereof and the Closing shall nevertheless occur as otherwise
provided for in this Agreement, except Seller shall assign to Buyer upon the
Closing all insurance proceeds paid or payable to Seller in connection with
such occurrences.  Seller shall have no
obligation to repair such damage or destruction.  Notwithstanding the foregoing, if such damage or
destruction to the Property shall cost more than $ 100,000 to repair, then
Seller shall promptly so notify Buyer and within five (5) business days after
receipt of such notice, Buyer shall deliver written notice to Seller and Escrow
Holder, electing either: (a) to proceed with this transaction and Closing in
accordance with this Agreement notwithstanding such damage or destruction; or
(b) to terminate this Agreement in accordance with the terms of Section 3.3.  Buyer’s failure to deliver either of such
notices to Seller and Escrow Holder within such five (5) business day period
shall constitute Buyer’s election to proceed to Closing under clause (a).


 


4.6  Tenant Lease Amendments;
Management of Property.  Seller
agrees to promptly provide Buyer with a copy of all proposed amendments to
existing Leases, and all proposed new Leases, of any portion of the Property
proposed to be executed after the Effective Date and before the date (the “Stop Date”) that is seven (7) days prior to the Decision
Date for Buyer’s review, but in no event shall Buyer have any right to approve
the same, and Buyer’s failure to terminate this Agreement on or before the
Decision Date shall constitute Buyer’s deemed approval of all such Lease
amendments and new Leases.  From and
after the Stop Date, Buyer shall not execute any amendments to any


 


8





















 


existing Leases, or any new Leases, without Buyer’s prior written
consent.  Upon the Closing, Buyer shall
reimburse Seller for, or assume Seller’s obligations with respect to, all
leasing commissions paid or payable by Seller and/or tenant improvement
obligations of Seller with respect to all Lease amendments and new Leases
approved (or deemed approved) by Buyer pursuant to this Section 4.6 (except
Seller shall be responsible for all such expenses related to any such lease
with Cingular Wireless, and Seller shall be responsible for any leasing
commissions payable with respect to any Leases that are renewed or extended
before the Closing Date).  Subject to
damage or destruction, or other matters outside of Seller’s control, Seller
agrees to continue to manage the Property until Closing in the same manner it
is currently managing the Property (in no event shall Seller have any
obligation to make capital repairs, replacements or improvements, nor to cause
the Property to comply with applicable laws).  Prior to Closing, and for a reasonable period
of time thereafter, Seller agrees to reasonably cooperate with Buyer and Buyer’s
accountants to facilitate Buyer’s evaluations and required reports, including
at least a one-year audit of the books and records of the Property, which audit
shall conclude with the execution by Seller of a letter in the form attached
hereto as Schedule 4.6 (Seller confirms that the representations in such letter
are, to Seller’s knowledge, correct as of the date of execution of this
Agreement, but Seller reserves the right to revise such letter to reflect the
state of Seller’s knowledge at the time Seller is requested to execute such
letter).


 


4.7  Estoppel
Certificates.  Seller agrees to promptly exert good faith
efforts to obtain estoppel certificates (“Estoppels”) and
subordination, non-disturbance and attornment agreements (“SNDAs”),
on Seller’s form or on such other reasonable forms as Buyer shall deliver to
Seller within five (5) days after the Effective Date, from the Tenants.  Seller shall not be in default hereunder by
reason of the unavailability, or contents, of any Estoppel or SNDA.  Subject to the further terms of this Section
4.7, Buyer shall have the right to terminate this Agreement pursuant to Section
3.3 if prior to Closing Seller shall be unable to obtain Estoppels approved by
Buyer executed by (i) Ralph’s (the “Major”), plus
(ii) other tenants (the “Minors”) which,
in the aggregate, occupy at least seventy five percent (75%) of the remaining
leased space at the Property not counting the space leased by the Major.  Buyer shall be deemed to have approved each
Estoppel delivered to it by Seller unless Buyer shall have delivered written
notice to Seller objecting to such Estoppel within four (4) days after Seller’s
delivery of such Estoppel to Buyer.  Buyer shall have no right to object to, and
shall be deemed to have approved, any Estoppel executed on a form set forth in,
or stipulated by, the applicable lease that does not reflect a default by
landlord or tenant and that does not contain any information materially
inconsistent with the information set forth in the applicable lease to which it
pertains.  Buyer shall have no right to terminate
this Agreement by reason of the unavailability, or contents, of any SNDAs.  Seller agrees to execute and deliver to Buyer
at Closing a “Seller Estoppel” with respect to those Minors as to which Seller
has been unable to obtain an executed Estoppel, but each Seller Estoppel shall
be limited “to Seller’s knowledge” (as defined in Section 4.1.7).


 


4.8  Hazardous
Material Waiver.  Buyer, on behalf of itself, its successors
and assigns, hereby releases Indemnitees from and against any and all
liabilities, claims, demands, suits, judgments, causes of action (including,
but not limited to, causes of action arising under the Comprehensive
Environmental Response Compensation and Liability Act of 1980, 42 U.S.C. §§
9601 et. seq.), losses, costs, damages, injuries, penalties,
enforcement actions, fines, taxes, remedial actions, removal and disposal
costs, investigation and remediation costs and expenses (including, without
limit, attorneys’ fees, litigation, arbitration and administrative proceeding
costs,


 


9





















 


expert and consultant fees and laboratory costs),
sums paid in settlement of claims, whether direct or indirect, known or
unknown, arising out of, related in any way to, or resulting from or in
connection with, in whole or in part, the presence or suspected presence of
Hazardous Materials (defined below) in, on, under, or about the Property.


 


“Hazardous Material(s)” means any chemical, substance,
material, controlled substance, object, condition, waste living organisms or
combination thereof which is or may be hazardous to human health or safety or
to the environment due to his radioactivity, ignitability, corrosivity,
reactivity, explosivity, toxicity, carcinogenicity, mutagenicity,
phytotoxicity, infectiousness or other harmful or potentially harmful
properties or effects, including, without limitation, petroleum hydrocarbons
and petroleum products, lead, asbestos, radon, polychlorinated biphenyls (PCBs)
and all of those chemicals, substances, materials, controlled substances,
objects, conditions, wastes, living organisms or combinations thereof which are
now or become in the future listed, defined or regulated in any manner by any
federal, state or local law based upon, directly or indirectly, such properties
or effects.


 


5.  CLOSING


 


5.1  Deposits
Into Escrow.


 


5.1.1  At
least one (1) business day prior to the Closing Date, Seller shall deposit into
Escrow:


 


(a)  A
grant deed conveying the Project to Buyer (the “Deed”),
subject to the Permitted Exceptions;


 


(b)  An
affidavit or qualifying statement which satisfies the requirements of Section
1445 of the Internal Revenue Code of 1986, as amended, and the regulations
thereunder (the “Non-Foreign Affidavit”), and a “Withholding
Exemption Certificate, Form 593”, pursuant to the California Revenue and
Taxation Code stating either the amount of withholding required from Seller’s
proceeds or that Seller is exempt from such withholding requirement (the “Certificate”).


 


(c)  An
original bill of sale and assignment (the “Bill of Sale”),
duly executed by Seller, assigning and conveying to Buyer all of Seller’s
right, title and interest in and to the Personal Property.  The Bill of Sale shall be in the form of Exhibit
“B” attached hereto;


 


(d)  An
original assignment and assumption agreement (the “Assignment
and Assumption Agreement”) duly executed by Seller assigning all of
Seller’s right, title and interest in and to the Leases and the Contracts.  The Assignment and Assumption Agreement shall
be in the form of Exhibit “C” attached hereto; and


 


(e)  A
letter to each Tenant (the “Tenant Letters”)
advising the Tenant of the sale of the Property, the transfer of the Tenant’s
security deposit to Buyer and of the name and address of Buyer (or its property
manager).


 


10





















 


5.1.2  On or
before 10:00 a.m.  Pacific time or the
Closing Date, Buyer shall deposit into Escrow:


 


(a)  Funds
in accordance with the provisions of Section 1.3.2;


 


(b)  Buyer’s
Reaffirmation Certificate;


 


(c)  An
original counterpart of the Assignment and Assumption Agreement duly executed
by Buyer; and


 


(d) 
the Tenant Letters.


 


5.1.3  Seller
and Buyer shall each deposit such other instruments and funds as are reasonably
required by Escrow Holder or otherwise required to close Escrow and consummate
the sale of the Property in accordance with the terms of this Agreement,
including but not limited to documents required under Section 5.4.1.


 


5.2  Prorations.


 


5.2.1  Rentals
from Leases (including fixed monthly rentals and other periodic rentals, additional
rentals, percentage rentals, operating cost pass-throughs and other sums and
charges payable by the tenants), prepaid rentals and prepaid payments
(collectively, “Rent”) shall, subject to the
further provisions hereof, be prorated on the basis that Buyer shall receive a
credit for all security deposits actually held by Seller and for all Rent which
Seller has actually received before the Closing which is allocable to the
period after the Closing.  Seller shall
not receive a credit for any Rent Seller has not received as of the Closing
that is allocable to the period prior to the Closing.  If Buyer shall collect any such Rent
(including without limitation percentage rent) after the Closing, Buyer shall
promptly pay the same to Seller, after application of the same to any rent due
from the applicable Tenant after the Closing.


 


5.2.2  Real
estate taxes shall be prorated as of the Closing on the basis of the most recent
assessed valuation of and rates and multiplier applicable to the Property.  If prorations are not made on the basis of the
current tax year or if supplemental taxes are assessed after the Closing for the
period prior to the Closing, the parties shall make any necessary adjustment
after Closing by cash payment upon demand to the party entitled thereto so that
Seller shall have borne all taxes allocable to the period prior to the Closing
(including all supplemental taxes which are allocable to the period prior to
Closing) and Buyer shall bear all taxes allocable to the period after the
Closing (including all supplemental taxes which arc allocable to the period
after the Closing).


 


5.2.3  Seller
shall endeavor to have all of its utility accounts with respect to the Property
closed out effective as of the Closing Date; if such close-out is not possible,
utilities shall be prorated as of the Closing (with the assumption that utility
charges were uniformly incurred during the billing period in which the Closing
occurs).


 


5.2.4  Common
area and maintenance charges, property taxes, insurance and other operating
cost pass-throughs payable by Tenants which accrue as of the Closing Date, but
which are


 


11





















 


not
then due and payable (collectively, the “Operating Expenses”),
shall not be prorated, except as herein provided.  Buyer shall receive and retain any Operating
Expenses paid by Tenants on or after the Closing Date and Seller shall receive
and retain any Operating Expenses paid by Tenants prior to the Closing Date;
provided, however, that any monthly or periodic deposits or payments of
estimated Operating Expenses with respect to the month in which the Closing
occurs received by Seller prior to the Closing Date or by Buyer on or after the
Closing Date shall be prorated as of the Closing Date.  Buyer and Seller shall prorate at Closing,
actual Operating Expenses collected by Seller from Tenants prior to Closing
with actual Operating Expenses paid by Seller with respect to such period, so
that if there are any rebates owing to Tenants for the period of Seller’s
ownership, Seller shall pay Buyer the amount of such rebates at Closing, and if
the Tenants owe the landlord any additional amounts for Operating Expenses with
respect to the period of Seller’s ownership, Buyer shall promptly pay Seller
the amount so owed to the landlord upon Buyer’s receipt of the same (and Buyer
shall exert diligent good faith efforts to collect the same).  Any prorations under this Agreement based upon
monthly amounts shall be based upon a thirty (30) day month; any prorations
under this Agreement based upon annual amounts shall be based upon a 366 day
year.


 


5.3  Payment
of Closing Costs.


 


5.3.1  Closing
Costs Borne by Seller.  Seller shall bear and Escrow Holder shall discharge
on Seller’s behalf out of the sums payable to Seller hereunder (a) one-half of
Escrow Holder’s fee, (b) the Kern County documentary transfer taxes, (c) all
costs and expenses of the Owner’s Policy (except Buyer shall pay all costs
attributable to any endorsements, any extended coverage and any deletion of the
survey exception from the policy), and (d) any additional charges payable in
accordance with common escrow practices in Kern County, California.


 


5.3.2  Closing
Costs Borne by Buyer.  Buyer shall
deposit with Escrow Holder for disbursement by Escrow Holder (a) one-half of
Escrow Holder’s fee, (b) all costs and expenses of the Owner’s Policy not borne
by Seller, (c) the recording fees and documentary transfer fees not borne by
Seller required in connection with the transfer of the Property to Buyer, and
(d) any additional charges payable in accordance with common escrow practices
in Kern County, California.


 


5.4  Closing
of Escrow.


 


5.4.1  Pursuant
to Section 6045 of the Internal Revenue and Taxation Code, Escrow Holder shall
be designated the “closing agent” hereunder and shall be solely responsible for
complying with the tax reform act of 1986 with regard to reporting all
settlement information to the Internal Revenue Service.


 


5.4.2  Escrow
Holder shall hold the Closing on the Closing Date if: (i) it has received in a
timely manner all the funds and materials required to be delivered into Escrow
by Buyer and Seller; and (ii) it has received assurances satisfactory to it
that, effective as of the Closing, the Title Company will issue to Buyer, its
standard coverage CLTA title insurance policy in the amount of the Purchase
Price, insuring Buyer as the owner of the Property, subject only to the
Permitted Exceptions (the “Owner’s Policy”).


 


5.4.3  To
Close the Escrow, Escrow Holder shall:


 


12





















 


(a)  Cause
the Deed to be recorded and thereafter mailed to Buyer, and deliver the Owner’s
Policy, Bill of Sale, Assignment
and Assumption Agreement (executed by Seller) and Non-Foreign Affidavit and Certificate
to Buyer; and


 


(b)  Deliver
to Seller the Buyer’s Reaffirmation Certificate, the Assignment and Assumption
Agreement (executed by Buyer), and by wire transfer of federal funds, funds in
the amount of the Purchase Price, plus or less any net debit or credit to
Seller by reason of the prorations and allocations of closing costs provided
for in this Agreement.


 


5.5  Failure
to Close; Cancellation.  If Escrow
Holder is not in a position to Close the Escrow on the Closing Date, then this
Agreement shall terminate (and if Buyer is in default the Deposit shall be paid
to Seller), except that no such termination shall relieve either party of liability for any failure to comply with
the terms of this Agreement.


 


5.6  LIQUIDATED
DAMAGES.  BUYER AND SELLER AGREE THAT IN THE EVENT OF A MATERIAL DEFAULT OR BREACH
HEREUNDER BY BUYER (INCLUDING, WITHOUT
LIMITATION, ANY DEFAULT OR BREACH
BY BUYER WHICH RESULTS IN THE FAILURE OF ESCROW TO CLOSE), THE DAMAGES TO SELLER WOULD BE EXTREMELY DIFFICULT
AND IMPRACTICABLE TO ASCERTAIN,
AND THAT THEREFORE THE DEPOSIT IS A REASONABLE ESTIMATE OF THE DAMAGES TO
SELLER, SUCH DAMAGES INCLUDING
COSTS OF NEGOTIATING AND DRAFTING OF THIS AGREEMENT, COSTS OF COOPERATING IN SATISFYING CONDITIONS TO
CLOSING, COSTS OF SEEKING ANOTHER
BUYER UPON BUYER’S DEFAULT,
OPPORTUNITY COSTS IN, AND CARRYING
COST ASSOCIATED WITH, KEEPING THE
PROPERTY OUT OF THE MARKETPLACE,
AND OTHER COSTS INCURRED IN CONNECTION HEREWITH.  ACCORDINGLY, BUYER AND SELLER AGREE THAT, EXCEPT FOR ANY DAMAGES, COSTS AND EXPENSES INCURRED IN CONNECTION WITH OR RESULTING FROM BUYER’S DEFAULT, OR BREACH OF ITS INDEMNITY OBLIGATIONS UNDER SECTIONS
3.5 AND 6.16 (WHICH DAMAGES, COSTS AND EXPENSES SHALL SURVIVE ANY CLOSING OR
TERMINATION OF THIS AGREEMENT AND ARE NOT LIMITED BY THIS SECTION 5.6),
RECEIPT AND RETENTION OF THE DEPOSIT SHALL BE THE SOLE DAMAGES OF SELLER IN THE EVENT OF ANY BREACH OR DEFAULT BY BUYER HEREUNDER.


 


	
   

  	
  /s/
  PSD/[ILLEGIBLE]

  	
   

  	
  /s/
  [ILLEGIBLE]

  	
   

  
	
   

  	
  Seller’s
  Initials

  	
   

  	
  Buyer’s
  Initials

  	
   

  



 


5.7  Seller’s
Breach.  In the event of a material
breach by Seller hereunder, Buyer’s remedies shall be limited to (i)
termination of this Agreement and the return to it of the Deposit, or (ii)
specific performance of this Agreement.  Buyer
expressly waives and releases any right to sue Seller for damages.


 


5.8  Possession.  Subject to the Permitted Exceptions and the
rights of the Tenants, possession of the Property shall be delivered to Buyer
upon Closing.


 


13





















 


6.  GENERAL
PROVISIONS


 


6.1  Counterparts.
 This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of which,
taken together, shall constitute one and the same instrument.


 


6.2  Entire Agreement.  This Agreement contains the
entire integrated agreement between the parties respecting the subject matter
of this Agreement and supersedes all prior and contemporaneous understandings
and agreements, whether oral or in writing, between the parties respecting the
subject matter of this Agreement.


 


6.3  Legal
Advice; Neutral Interpretation; Headings.  Each party has received independent legal
advice from its attorneys with respect to the advisability of executing this
Agreement and the meaning of the provisions hereof.  The provisions of this Agreement shall be
construed as to their fair meaning, and not for or against any party based upon
any attribution to such party as the source of the language in question.  Headings used in this Agreement are for
convenience of reference only and shall not be used in construing this
Agreement.


 


6.4  Choice
of Law.  This Agreement shall be
governed by the laws of the State of California.


 


6.5  Severability.
 If any term, covenant, condition or
provision of this Agreement, or the application thereof to any person or
circumstance, shall to any extent be held by a court of competent jurisdiction
to be invalid, void or unenforceable, the remainder of the terms, covenants, conditions
or provisions of this Agreement, or the application thereof to any person or
circumstance, shall remain in full force and effect and shall in no way be
affected, impaired or invalidated thereby.


 


6.6  Waiver
of Covenants, Conditions or Remedies. 
The waiver by one party of the performance of any covenant, condition or
promise under this Agreement shall not invalidate this Agreement nor shall it
be considered a waiver by it of any other covenant, condition or promise under
this Agreement.  The waiver by Either or
both parties of the time for performing any act under this Agreement shall not
constitute a waiver of the time for performing any other act or an identical act
required to be performed at a later time.  The exercise of any remedy provided in this
Agreement shall not be a waiver of any consistent remedy provided by law, and
the provision in this Agreement for any remedy shall not exclude other
consistent remedies unless they are expressly excluded.


 


6.7  Exhibits.  All exhibits to which reference is made in
this Agreement are deemed incorporated in this Agreement.


 


6.8  Amendment.  This
Agreement may be amended at any time by the written agreement of Buyer and
Seller.  All amendments, changes,
revisions and discharges of this Agreement, in whole or in part, and from time
to time, shall be binding upon the parties despite any lack of legal consideration,
so long as the same shall be in writing and executed by the parties hereto.


 


6.9  Relationship
of Parties.  The parties agree that their relationship is
that of seller and buyer, and that nothing contained herein shall constitute
either party the agent or legal representative of the other for any purpose
whatsoever, nor shall this Agreement be deemed to create any form of business
organization between the parties hereto, nor is either party granted any right
or authority to


 


14





















 


assume
or create any obligation or responsibility on behalf of the other party, nor
shall either party be in any way liable for any debt of the other.


 


6.10  No
Third Party Benefit.  This Agreement
is intended to benefit only the parties hereto and no other person or entity
has or shall acquire any rights hereunder.


 


6.11  Time
of the Essence.  Time shall be of the
essence as to all dates and times of performance, whether contained herein or
contained in any escrow instructions to be executed pursuant to this Agreement,
and all escrow instructions shall contain a provision to this effect.


 


6.12  Further
Acts.  Each party agrees to perform
any further acts and to execute, acknowledge and deliver any documents, which
may be reasonably necessary to carry out the provisions of this Agreement.


 


6.13   Recordation.  Buyer shall not record this Agreement, any
memorandum of this Agreement, any assignment of this Agreement or any other
document that would cause a cloud on the title to the Property.


 


6.14  Assignment.
 Upon written notice to Seller, Buyer
shall be entitled to assign Buyer’s rights and delegate its obligations
hereunder to a third party controlled by Buyer, but no such assignment shall
release Buyer of any liability hereunder.  Each party agrees to cooperate with the other
party in competing an exchange qualifying for nonrecognition of gain under
Internal Revenue Code §1031 and the applicable provisions of the California
Revenue and Taxation Code (“Exchange”), and
each party reserves the right to convert this transaction to an Exchange at any
time before the Closing Date.  If either
party does elect to complete an Exchange, the other party shall execute all
escrow instructions, documents, agreements or instruments reasonably requested
by the first party to complete the Exchange; provided, however, that the other
party shall incur no additional liabilities, expenses or costs (other than its
attorneys fees in reviewing customary Exchange documentation) as a result of or
connected with such Exchange, and shall not be required to take title to any
other property.  Notwithstanding that the
transaction contemplated hereby should be effected as an Exchange through a
third party as a qualified IRC §1031 intermediary, all obligations,
representation, warranties and indemnities made by Buyer shall run to Seller,
and all obligations, representations, warranties and indemnities made by Seller
shall run to Buyer, despite the fact that an intermediary or other third party
facilitating a party’s tax-deferred exchange was substituted hereunder for that
party.  Subject to the foregoing, this
Agreement shall be binding upon and shall inure to the benefit of the
successors and assigns of the parties to this Agreement.


 


6.15  Attorneys’
Fees.  In the event of any litigation
involving the parties to this Agreement to enforce any provision of this
Agreement, to enforce any remedy available upon default under this Agreement,
or seeking a declaration of the rights of either party under this Agreement,
the prevailing party shall be entitled to recover from the other such attorneys’
fees and costs as may be reasonably incurred, including the costs of reasonable
investigation, preparation and professional or expert consultation incurred by
reason of such litigation.  All other
attorneys’ fees and costs relating to this Agreement and the transactions
contemplated hereby shall be borne by the party incurring the same.


 


15





















 


6.16  Brokers.
 Pursuant to separate agreement, Seller
shall pay CB Richard Ellis (“Seller’s Broker”),
a brokerage commission for its services as broker in this transaction if, as
and when the Closing occurs (and Seller understands that Seller’s Broker has an
agreement with Buyer’s broker, CB Richard Ellis, to pay CB Richard Ellis a
portion of such commission at Closing).  Buyer and Seller each represent and warrant to
the other that, except as stated in the preceding sentence (a) they have not
dealt with any brokers or finders in connection with the purchase and sale of
the Property, and (b) insofar as such party knows, no broker or other person is
entitled to any commission or finder’s fee in connection with the purchase and
sale of the Property.  Seller and Buyer
each agree to indemnify and hold harmless the other against any loss,
liability, damage, cost, claim or expense incurred by reason of any brokerage
fee, commission or finder’s fee which is payable or alleged to be payable to
any broker or finder because of any agreement, act, omission or statement of
the indemnifying party.  The provisions
of this Section 6.16 shall not be limited in any way by any terms of this
Agreement.


 


6.17  Manner
of Giving Notice.  All notices and
demands which either party is required or desires to give to the other shall be
given in writing by personal delivery, express courier service or by telecopy
followed by next day delivery of a hard copy to the address or telecopy number
set forth below for the respective party, provided that if any party gives
notice of a change of name, address or telecopy number, notices to that party
shall thereafter be given as demanded in that notice.  All notices and demands so given shall be
effective upon receipt by the party to whom notice or a demand is being given.


 


	
  To Buyer:

  	
   

  	
  To
  Seller:

  
	
  Inland Real Estate Acquisitions, Inc.

  	
   

  	
  Donahue
  Schriber Realty Group, L.P.

  
	
  2901 Butterfield Road

  	
   

  	
  200
  E. Baker Street, Suite 100

  
	
  Oak Brook, IL 60523

  	
   

  	
  Costa
  Mesa, CA 92626

  
	
  Attn.: Mark Youngman

  	
   

  	
  Attn.:
  Dirk Van Wyk

  
	
  Telephone: 630-218-4948

  	
   

  	
  Telephone:
  (714) 545-1400

  
	
  Fax: 630-218-4935

  	
   

  	
  Fax:
  (714) 545-4222

  
	
   

  	
   

  	
   

  
	
  With a copy to:

  	
   

  	
  With
  a copy to:

  
	
   

  	
   

  	
  David
  Greenman

  
	
   

  	
   

  	
  18800
  Von Karman Avenue, Suite 100

  
	
   

  	
   

  	
  Irvine,
  CA 92612

  
	
   

  	
   

  	
  Telephone:
  (949) 224-0338

  
	
   

  	
   

  	
  Fax:  (949) 224-0339

  



 


6.18  Survival.
 The terms and provisions of this
Agreement shall survive the Closing and the consummation of the transactions
contemplated by this Agreement or the termination of this Agreement for any
reason without the conveyance of the Property to Buyer.


 


SIGNATURES ON NEXT PAGE


 


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IN WITNESS WHEREOF, the parties have duly executed this Agreement as of
the day and year first above written.


 


	
  SELLER:

  	
   

  	
  Donahue Schriber Realty
  Group, L.P., a Delaware limited
partnership

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:
  Donahue Shriber Realty Group, Inc., a Maryland

  corporation its general
  partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Patrick S. Donahue

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Patrick S. Donahue 

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
  President

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/
  Dirk Van Wyk

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Dirk
  Van Wyk

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  	
   

  
	
   

  	
   

  	
   

  
	
  BUYER:

  	
   

  	
  Inland
  Real Estate Acquisitions, Inc., an Illinois corporation

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Mark Youngman

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Mark Youngman

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  	
   

  
							



 


JOINDER OF ESCROW HOLDER


 


Escrow Holder executes this Agreement for the purpose of agreeing to
serve as escrow agent with respect to the Deposit and closing in accordance
with this Agreeement.


 


	
   

  	
   

  	
  STEWART TITLE GUARANTY COMPANY

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Josette Loaiza

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Josette Loaiza

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Commercial Escrow Officer

  	
   

  
						



 


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