Document:

ex_242492.htm

 

FIRST AMENDMENT 

TO 

REAL ESTATE PURCHASE AND SALE AGREEMENT 

WITH ESCROW INSTRUCTIONS 

 

 

 

         THIS FIRST AMENDMENT TO REAL ESTATE PURCHASE AND SALE

 

AGREEMENT WITH ESCROW INSTRUCTIONS ("Amendment") is made and entered into as of February 23, 2021, and constitutes an agreement between PERMA-PIPE INC., a Delaware corporation ("Seller"), and WINKLER PROPERTIES, LP, a California limited partnership ("Buyer"), with reference to the following:

 

 

	 	
			A.

				
			Buyer and Seller entered into that certain Real Estate Purchase and Sale

			

 

Agreement with Escrow Instructions dated January 22, 2021 ("Agreement"), pursuant to which Seller agreed to sell to Buyer, and Buyer agreed to purchase from Seller, that certain real property located at 1310 Quarles Dr., Lebanon, Tennessee, comprising assessor's parcel number 095058G A 00200, as more particularly described in the Agreement and Title Commitment ("Property").

 

 

	 	
			B.

				
			Buyer and Seller desire to amend certain terms of the Agreement as set forth herein.

			

 

 

         NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Buyer and Seller agree as follows:

 

1.    Definitions. Capitalized terms not otherwise defined herein shall have the meaning ascribed to them in the Agreement.

 

2.    Cover Page. The cover page of the Agreement is hereby amended by replacing "<Perma-Pipe>" with the following Real Property description:

 

"APN: 095058G A 00200

 

Commonly known as

 

1310 QUARLES DR, LEBANON, TN 37087-2551"

 

3.    Escrow Agent and Title Company. The definitions for Escrow Agent and Title Company in Section 1 of the Agreement are hereby amended to reflect "Fidelity National Title Insurance Company through its local office in Newport Beach, California".

 

4.    Price. Section 3 of the Agreement is hereby amended and replaced with the following:

 

"The total Purchase Price to be paid by Buyer to Seller for the Property shall be the sum of Ten Million Four Hundred Thousand Dollars ($10,400,000.00), subject to adjustments, credits and prorations as set forth in this Agreement. Upon the Closing, Seller acknowledges and agrees to pay to Core Realty

Holdings Mgmt., Inc. an acquisition fee in the sum of Four Hundred Thousand

Dollars ($400,000.00) from Seller's Closing proceeds."

 

5.    Closing. The first sentence of Section 17 is hereby amended and restated as follows:

 

"The purchase and sale of the Property shall be consummated on a date, mutually agreed upon by Seller and Buyer (the “Closing”), which is on or before April 15, 2021 (the “Outside Closing Date”)."

 

6.    Buyer's Title Notice. Section 8(a)(ii) of the Agreement is hereby amended such that Buyer's Title Notice must be delivered to Seller within ten (10) business days following the receipt by Buyer of the Title Commitment and all underlying exception documents.

 

7.    Survey. Section 8(a)(vii) of the Agreement is hereby amended such that Buyer shall have until the earlier of (A) ten (10) business days after its receipt of the Survey or (B) the Contingency Expiration Date to deliver an additional Buyer’s Title Notice with respect to any matter that is shown on the Survey.

 

8.    Costs. Section 12(b) of the Agreement is hereby amended by deleting item (ii).

 

 

 

 

9.    Seller's Representations and Warranties. The following representations and warranties are added to the end of Section 15(b) of the Agreement:

 

 

"(xvi) Neither Seller nor, to Seller’s knowledge, any other third party has used, generated, transported, discharged, released, manufactured, stored, or disposed any Hazardous Materials from, into, at, on, under, or about the Property, except as disclosed in the Property Files. To Seller’s knowledge (i) the Property is not in violation, nor has been or is currently under investigation for violation of any

Hazardous Materials law; (ii) there has been no migration of any Hazardous

 

Materials from, into, at, on, under or about the Property in violation of any Hazardous Materials law; and (c) there is not now, nor has there ever been on or in the Property underground storage tanks or surface or below-grade impoundments used to store, treat or handle Hazardous Materials or debris or refuse buried in, on or under the Property.

 

	 	
			(xvii)

				
			To Seller’s knowledge, there are no patent or latent defects on or about the Property.

			

 

	 	
			(xviii)

				
			Seller has not received any written notice that the Property is in violation of any law, ordinance, code, rule or regulation to which the Property is subject (including any Hazardous Materials law or the American’s With Disabilities

			

Act); and Seller has no knowledge of any facts or circumstances upon which

 

such a notice could, in good faith, be based (including under any Hazardous Materials law or the American’s With Disabilities Act).

 

	 	
			(xix)

				
			Neither Seller nor any entity or person that owns or controls Seller is bankrupt or insolvent under any applicable Federal or state standard, has filed for protection or relief under any applicable bankruptcy or creditor protection statute, or has been threatened by creditors with an involuntary application of any applicable bankruptcy or creditor protection statute. Seller is not entering into the transactions described in this Agreement intending to defraud any creditor or to prefer the rights of one creditor to any other. Seller and Buyer have negotiated this Agreement at arm’s length and the consideration paid represents fair value for the assets being transferred.

			

 

	 	
			(xx)

				
			Seller has not made any commitment or representation to any Authorities, or to any adjoining or surrounding property owner, that would in any way be binding on Buyer or would in any way interfere with Buyer’s ability to continue to operate the Property as currently operated on the date of this Agreement.

			

 

	 	
			(xxi)

				
			The Property Files delivered by Seller to Buyer are accurate copies and complete copies. Seller has no knowledge of any material errors or inaccuracies in any of the Property Files.

			

 

 

         For purposes of Seller’s representations and warranties in this Paragraph 15(b), the phrases “to Seller’s knowledge” or “to the best of Seller’s knowledge” shall mean the knowledge of the officers of Seller who, after due and careful inquiry, have actual knowledge of the facts and events in relation to or on the basis of which the relevant statements are made.

 

10.    Notices. Buyer's notice information as set forth in Section 18 of the Agreement is hereby amended and restated as follows:

 

 

 

	
			To Buyer:           

			 

				
			Winkler Properties, LP

			32932 Pacific Coast Hwy., #14-487

			Dana Point, California 92629

			Attn: Marvin Winkler

			Email: marvwinkler@gmail.com

			
	
			With a copy to:

				
			Palmieri, Tyler, Wiener, Wilhelm & Waldron LLP

			1900 Main St., Ste. 700

			Irvine, California 92614

			Attn: Ryan Prager

			Email: rprager@ptwww.com

			

 

11.    Insurance Shortfall. Section 20 of the Agreement is hereby amended such that in the event Buyer receives a credit against the Purchase Price pursuant to Section 20, Buyer shall also receive a credit against the Purchase Price equal to the amount of such damage that is not covered by insurance, in addition to any and all other rights set forth in Section 20.

 

12.    Brokers. Section 21 of the Agreement is hereby amended such that Core Realty Holdings Mgmt., Inc. is also recognized as a broker or finder involved in the contemplated purchase and sale transaction and Seller will pay an acquisition fee to Core Realty Holdings Mgmt., Inc. pursuant to Section 3 of the Agreement.

 

13.    List of Property Files. Exhibit "F" of the Agreement is hereby amended and restated as attached hereto as Exhibit "F" and incorporated herein by this reference.

 

14.    Lease. The Lease, as attached to the Agreement as Exhibit "D", is hereby amended and restated as attached hereto as Exhibit "D" and incorporated herein by this reference.

 

15.    No Further Changes. Except as expressly amended herein, all terms of the Agreement shall remain in full force and effect.

 

16.    Counterparts. This Amendment may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute but one and the same instrument.

 

 

(Signature Page Follows)

 

         

 

 

 

 

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

 

 

SELLER:          BUYER: 

 

PERMA-PIPE, INC.,          WINKLER PROPERTIES, LP,

 

a Delaware corporation          a California limited partnership

 

         

 

         

 

By:  /s/ D. Bryan Norwood       By: /s/ Marvin Winkler    

 

Bryan Norwood, CFO           Marvin Winkler, Managing Partner

 

 

          

 

 

 

     EXHIBIT “D”

LEASE

 

 

{Attached Hereto}

 

 

 

 

 

 

EXHIBIT “F”

 

LIST OF PROPERTY FILES

 

 

Buyer’s performance is conditioned upon the Buyer’s approval of the following: All Seller items to the extent those items exist and/or are in Seller’s possession or control

 

 

	 	
			1.

				
			Current preliminary title report.

			

 

	 	
			2.

				
			All existing vendor, service and personnel contracts, including janitorial, laundry, HVAC, landscape, trash removal, parking lot maintenance, management, insurance and any other binding contracts.

			

 

	 	
			3.

				
			Seller’s operating statements reflecting the past 36 months of operation of the property. Seller to provide monthly updates prior to the Closing Date.

			

 

	 	
			4.

				
			Twelve months trailing by month operating statements for the property including detailed income statement and tenant aging report to be updated monthly through month of Closing.

			

 

	 	
			5.

				
			A report of a licensed HVAC contractor concerning the condition of HVAC equipment and its capability to service the premises.

			

 

	 	
			6.

				
			Report of a licensed roofer concerning the water-proofness and condition of the roof.

			

 

	 	
			7.

				
			Copies of utility bills for the past three (3) calendar years.

			

 

	 	
			8.

				
			Copies of the past three (3) fiscal years real estate tax bills.

			

 

	 	
			9.

				
			A schedule of all current or pending litigation with respect to the property and brief description of proceeding.

			

 

	 	
			10.

				
			Any and all existing Phase I or II Toxic Studies on the property and information regarding hazardous materials.

			

 

	 	
			11.

				
			Insurance Loss History.

			

 

	 	
			12.

				
			Certificates of Occupancy for building shells and tenant premises or Seller’s cooperation to obtain.

			

 

	 	
			13.

				
			Evidence that the property complies with all current zoning and building codes from the City Building Department or Seller’s cooperation to obtain.

			

 

	 	
			14.

				
			ALTA Title Policy and independent survey with costs split equally showing title vested in Buyer’s name with no encumbrance or exceptions shown except those previously approved by Buyer’s in writing.

			

 

	 	
			15.

				
			Copies of any reports for soils, geological and geotechnical.

			

 

	 	
			16.

				
			Copies of business licenses.

			

 

	 	
			17.

				
			Copies of any other permits, authorizations, approvals, certificates and entitlements relating to the Property.

			

 

	 	
			18.

				
			Inspection reports for the fire sprinkler system, if any.

			

 

	 	
			19.

				
			Information covering the last three years of capital expenditures.

			

 

	 	
			20.

				
			COVID-19 Deferrals and arrangements – aged receivables, COVID-19 agreements or payments, bad debt reports.

			

 

	 	
			21.

				
			Plans and specifications for all buildings.

			

 

	 	
			22.

				
			Property work orders for the last year.

			

 

	 	
			23.

				
			Leak reports for plumbing and sewer, if any.

			

 

	 	
			24.

				
			Inspection reports for plumbing, sewer, and fire sprinkler system, if any.

			

 

	 	
			25.

				
			Copies of all notices concerning violations, including, but not limited to, zoning ordinances, building codes, fire codes, CC&Rs or other agreements affecting the Property.

			

 

	 	
			26.

				
			Governmental authority notices of building code, zoning, fire or health code violations, if anyex_242493.htm

 

SECOND AMENDMENT 

TO 

REAL ESTATE PURCHASE AND SALE AGREEMENT 

WITH ESCROW INSTRUCTIONS 

 

 

 

         THIS SECOND AMENDMENT TO REAL ESTATE PURCHASE AND SALE

 

AGREEMENT WITH ESCROW INSTRUCTIONS ("Amendment") is made and entered into as of April 12, 2021, and constitutes an agreement between PERMA-PIPE INC., a Delaware corporation ("Seller"), and NASH88, LLC, a Delaware limited liability company ("Buyer"), with reference to the following:

 

 

	 	
			A.

				
			Buyer and Seller entered into that certain Real Estate Purchase and Sale

			

 

Agreement with Escrow Instructions dated January 22, 2021, and amended by that certain First Amendment dated February 23, 2021 (collectively, the "Agreement"), pursuant to which Seller agreed to sell to Buyer, and Buyer agreed to purchase from Seller, that certain real property located at 1310 Quarles Dr., Lebanon, Tennessee, comprising assessor's parcel number 058G-A-002.00-000, as more particularly described in the Agreement and Title Commitment ("Property").

 

 

B.    Buyer and Seller desire to amend certain terms of the Agreement as set forth herein.

 

 

         NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, Buyer and Seller agree as follows:

 

1.    Definitions. Capitalized terms not otherwise defined herein shall have the meaning ascribed to them in the Agreement.

 

2.    Environmental Holdback. Seller and Buyer desire to proceed towards a Closing but acknowledge (a) Buyer’s demand to conduct a Phase II environmental site assessment of the Property (the "Phase II Study") to further ascertain the environmental condition of the Property and any cleanup remediation that may be necessary, and (b) the outstanding Storm Water Management (SWM) Complaint for illegal dumping at the Property which was reported to the Tennessee Department of Environment and Conservation (TDEC) in October 2020 for an alleged event in 1995 (the "Complaint"). Seller and Buyer have agreed that the sum of Four Hundred Thousand Dollars ($400,000) (the "Holdback Amount") shall be retained by the Escrow Agent at Closing and shall be released to Seller pursuant to the terms set forth below, and upon written notice from Seller and Buyer that the following having been completed:

 

(i)    With Buyer’s reasonable cooperation at no cost to Buyer, Seller provides written notice from the TDEC to Buyer that the Complaint has been deemed ‘closed’ or such other TDEC designation meaning the TDEC will no longer pursue or investigate the Complaint or any of the allegations therein and that the TDEC considers the matter closed; and

 

(ii)    the Phase II Study is completed and results in environmental findings that do not require any remediation or environmental cleanup of the Property; or in the event the Phase II Study is completed and results in a finding of contaminants existing on, under or in the Property and Seller performs all remediation efforts of the contaminates as may be recommended by the Phase II Study, and as may be required by the TDEC or any applicable laws. Escrow Agent shall disburse such portion of the Holdback Amount to Seller against receipt of paid written invoicing from remediation contractors for the applicable cleanup efforts. Notwithstanding the foregoing, Seller acknowledges and agrees that any and all liability, costs and/or expenses resulting from the Complaint and any and all environmental remediation of the Property that may be disclosed by the Phase II Study and required by Buyer shall be at the sole cost and expense of Seller without limit and shall not in any way be limited by or to the Holdback Amount.

 

Upon Seller and Buyer providing written notice to Escrow Agent that the requirements of Section 2(i) and (ii) having been satisfied, the balance of the Holdback Amount, if any, shall be disbursed to Seller.

 

3.    Phase II Study Completion. Buyer agrees to have its third party vendor complete the Phase II Study, and Buyer shall deliver a copy thereof to Seller, on or before sixty (60) days after the Closing Date (the "Phase II Deadline"). In the event the Buyer fails to deliver to Seller the Phase II Study by the Phase II Deadline, the Buyer and Seller agree to provide written notice of same to Escrow Agent and Escrow Agent shall disburse the Holdback Amount to Seller. Notwithstanding the Buyer’s failure to meet the Phase II Deadline and the release of the Holdback Amount, Seller shall remain fully obligated to perform the requirements of Section 2(i) and any remediation efforts in Section 2(ii) as may be reflected in later delivered Phase II Study.

 

4.    Lender Protections.  In connection with, and as a condition and material inducement to, Citi Real Estate Funding Inc. (together with its successors and assigns, “Lender”) making a loan (the “Loan”) to Buyer to finance Buyer’s acquisition of the Property, Lender has required the provisions of this Section 4 to be incorporated into this Amendment. In the event of any conflict between the provisions of this Section 4 and the other provisions of this Amendment, the provisions of this Section 4 shall control. Lender is a third party beneficiary of this Amendment. Buyer hereby transfers, sets over and assigns to Lender, and grants to Lender a security interest in all of Buyer’s right, title and interest in and to the Holdback Amount (the “Escrow Rights”), if any.  Upon or at any time after the occurrence of an Event of Default (as defined in that certain Loan Amendment between Buyer and Lender executed in connection with the Loan) but subject to Sections 2 and 3 above, Lender shall be entitled to enforce the Escrow Rights.  Escrow Agent hereby acknowledges the foregoing assignment to Lender and consents thereto.   Buyer (A) represents and warrants that as of the date hereof Buyer has not made any other assignment of the Escrow Rights, and (B) covenants and agrees with Lender that it (i) will enforce this Amendment in accordance with its terms and (ii) will not make any other assignment of the Escrow Rights.  Without limiting any of the foregoing, the parties agree that (1) this Amendment may not be amended or modified without the prior written consent of Lender, and (2) Lender shall be entitled to receive the same notice as Buyer is entitled to receive under this Amendment upon any resignation or substitution of Escrow Agent, and Lender’s approval of any replacement of Escrow Agent must be obtained to the same extent of Buyer’s rights to approve any such replacement.  Lender’s address for notices hereunder is:

 

 

 

 

Citi Real Estate Funding Inc.

 

388 Greenwich Street, 8th Floor

 

New York, New York 10013

 

Attention:  Commercial Real Estate Group

 

Facsimile No.:  (646) 328-2938

 

 

With a copy to:

 

 

Katten Muchin Rosenman LLP

 

550 South Tryon Street, Suite 2900

 

Charlotte, North Carolina 28202

 

Attention:  John Domby, Esq.

 

Facsimile No.:  (704) 444-2050

 

5.    No Further Changes. Except as expressly amended herein, all terms of the Agreement shall remain in full force and effect.

 

6.    Counterparts. This Amendment may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute but one and the same instrument.

 

 

(Signature Page Follows)

 

         

 

 

 

 

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

 

 

SELLER:          BUYER: 

 

	
			PERMA-PIPE, INC.,

			a Delaware corporation

			By:   /s/ D. Bryan Norwood     

			       Bryan Norwood, CFO

				
			NASH88, LLC,

			a Delaware limited liability company

			By: Wink Family, LLC,

			         a California limited liability company

			         Its Manager

			         By:   /s/ Marvin Winkler          

			                Marvin Winkler, Manager

			

RECEIVED AND ACKNOWLEDGED

 

BY ESCROW AGENT:

 

 

FIDELITY NATIONAL TITLE

 

 

 

By:_/s/ Jody Kelly_____________________________

 

Name:______Jody Kelly____________________

 

Title:___V.P._________________________

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