ASSIGNMENT AND ASSUMPTION OF MEMBERSHIP INTERESTS
GMP Murfreesboro LLC
Dated as of June 6, 2024
ASSIGNMENT AND ASSUMPTION OF MEMBERSHIP INTERESTS
This ASSIGNMENT AND ASSUMPTION OF MEMBERSHIP INTERESTS (this "Assignment") is made and entered into as of June 6, 2024 (the "Closing Date"), by and between:
ASSIGNOR:
Greystone Meridian Partners Fund III, L.P., a Delaware limited partnership (the "Assignor" or "Seller"), acting by and through its general partner, Greystone Meridian Capital LLC, a Delaware limited liability company, having its principal office at 3300 Peachtree Road NE, Suite 2200, Atlanta, Georgia 30326, with a registered agent address at 1209 Orange Street, Wilmington, Delaware 19801, Federal Employer Identification Number 83-1647205;
ASSIGNEE:
Fairwater Real Estate Investment Trust, a Maryland real estate investment trust (the "Assignee" or "Buyer"), having its principal office at 7200 Chesapeake Parkway, Suite 1100, Columbia, Maryland 21044, Federal Employer Identification Number 52-2198437, whose common shares of beneficial interest are listed on the New York Stock Exchange under the ticker symbol "FREIT"; and
THE COMPANY:
GMP Murfreesboro LLC, a Delaware limited liability company (the "Company"), Federal Employer Identification Number 84-2527856, formed under the laws of the State of Delaware and the owner and operator of that certain real property commonly known as Murfreesboro Distribution Center, located at 1600 Joe B. Jackson Parkway, Murfreesboro, Tennessee 37127.
The Assignor and the Assignee are sometimes referred to herein individually as a "Party" and collectively as the "Parties."
RECITALS
WHEREAS, the Company is a single-purpose Delaware limited liability company that owns and operates the real property commonly known as Murfreesboro Distribution Center, consisting of approximately 502,000 rentable square feet of logistics and distribution space located at 1600 Joe B. Jackson Parkway, Murfreesboro, Tennessee 37127 (the "Property"), which was constructed and completed in 2020;
WHEREAS, the Assignor is the sole member and owner of one hundred percent (100%) of the membership interests in the Company (the "Membership Interests"), and no other person or entity holds any membership interests, economic interests, or other equity interests in the Company;
WHEREAS, the Assignor and the Assignee are parties to that certain Purchase and Sale Agreement dated as of February 28, 2024, as amended by that certain First Amendment to Purchase and Sale Agreement dated as of April 12, 2024, and as further amended by that certain Second Amendment to Purchase and Sale Agreement dated as of May 28, 2024 (as so amended, and as the same may be further amended, restated, supplemented, or otherwise modified from time to time, collectively, the "Purchase Agreement"), pursuant to which the Assignor agreed to sell, and the Assignee agreed to purchase, one hundred percent (100%) of the membership interests in each of fourteen (14) property-owning Delaware limited liability companies, including the Company, for an aggregate purchase price of One Billion One Hundred Million Dollars ($1,100,000,000) (the "Purchase Price");
WHEREAS, the Purchase Agreement is governed by the laws of the State of New York, without regard to principles of conflicts of law that would result in the application of the laws of any other jurisdiction;
WHEREAS, the Property is encumbered by certain mortgage indebtedness held by Pinnacle Federal Bank, N.A., a national banking association ("Lender"), pursuant to that certain Master Loan Agreement dated September 15, 2020, as amended from time to time (the "Master Loan Agreement"), specifically as Loan 1-H thereunder, with an outstanding principal balance attributable to the Company's loan as of the date of the Purchase Agreement forming part of the aggregate Four Hundred Twenty-One Million Six Hundred Thousand Dollars ($421,600,000) outstanding principal balance under such facility, bearing interest at four and twenty-two hundredths percent (4.22%) per annum, fixed, and maturing on July 1, 2028;
WHEREAS, Pinnacle Federal Bank, N.A. has consented to the change of control of the Company resulting from this Assignment, as evidenced by that certain consent letter executed on June 4, 2024 (the "Lender Consent"), a copy of which is included in Exhibit B attached hereto;
WHEREAS, Fairwater Real Estate Investment Trust has executed a Replacement Carve-Out Guaranty in favor of Pinnacle Federal Bank, N.A., dated as of the date hereof, replacing Greystone Meridian Partners Fund III, L.P. as guarantor of certain non-recourse carve-out obligations under the Master Loan Agreement with respect to Loan 1-H; and
WHEREAS, the Assignor and the Assignee now desire to consummate the transactions contemplated by the Purchase Agreement with respect to the Company by effecting the assignment and assumption of the Membership Interests on the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and agreements hereinafter set forth, the payment of the Purchase Price as allocated in accordance with the Purchase Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
ARTICLE I — DEFINITIONS
Section 1.1 — Defined Terms
As used in this Assignment, the following terms shall have the meanings set forth below:
"Assignment" means this Assignment and Assumption of Membership Interests, together with all exhibits and schedules attached hereto, as the same may be amended, restated, supplemented, or otherwise modified from time to time in accordance with the terms hereof.
"Closing Date" means June 6, 2024.
"Company" means GMP Murfreesboro LLC, a Delaware limited liability company, Federal Employer Identification Number 84-2527856.
"Lender" means Pinnacle Federal Bank, N.A., a national banking association.
"Lender Consent" has the meaning set forth in the Recitals.
"Master Loan Agreement" has the meaning set forth in the Recitals.
"Membership Interests" means one hundred percent (100%) of the membership interests in the Company, representing all of the issued and outstanding membership interests, economic interests, and other equity interests of any kind or nature in the Company.
"Operating Agreement" means the limited liability company operating agreement of the Company, as in effect immediately prior to the Closing Date, which shall be amended and restated in its entirety as of the Closing Date in the form of the Amended and Restated Operating Agreement executed concurrently herewith.
"Property" means the real property commonly known as Murfreesboro Distribution Center, located at 1600 Joe B. Jackson Parkway, Murfreesboro, Tennessee 37127, together with all buildings, improvements, structures, and fixtures located thereon, and all easements, rights-of-way, appurtenances, privileges, and other rights and benefits belonging or in any way appertaining thereto, as more particularly described in Exhibit A attached hereto.
"Purchase Agreement" has the meaning set forth in the Recitals.
"Purchase Price" has the meaning set forth in the Recitals.
All other capitalized terms used but not otherwise defined in this Assignment shall have the meanings ascribed to such terms in the Purchase Agreement, and the rules of interpretation, construction, and usage set forth in the Purchase Agreement shall apply to this Assignment, mutatis mutandis.
ARTICLE II — ASSIGNMENT AND ASSUMPTION
Section 2.1 — Assignment of Membership Interests
Effective as of the Closing Date, the Assignor hereby irrevocably assigns, transfers, conveys, sets over, and delivers to the Assignee, and the Assignee's successors and permitted assigns, all of the Assignor's right, title, and interest in, to, and under the Membership Interests, constituting one hundred percent (100%) of the issued and outstanding membership interests in the Company, free and clear of all liens, encumbrances, mortgages, pledges, security interests, charges, claims, restrictions, options, preemptive rights, rights of first refusal, and other adverse interests of any kind or nature whatsoever, other than those created by or arising under: (a) the Operating Agreement (as amended and restated as of the Closing Date); (b) the Purchase Agreement; (c) the assumed mortgage loan documents described in Exhibit B attached hereto; and (d) applicable federal and state securities laws of general applicability. This assignment is effective as of 12:01 a.m. Eastern Time on the Closing Date and shall be irrevocable upon execution and delivery of this Assignment.
Section 2.2 — Assumption by Assignee
The Assignee hereby accepts the foregoing assignment of the Membership Interests and, effective as of the Closing Date, assumes and agrees to perform, discharge, and be bound by all rights, obligations, duties, and liabilities of the Assignor as the sole member of the Company arising from and after the Closing Date, including, without limitation:
(a) all obligations of the Company under the assumed mortgage loan documents with respect to Loan 1-H under the Master Loan Agreement, as set forth in the separate Assumption Agreement — Pinnacle Loans executed by the Assignee concurrently herewith and delivered to the Lender;
(b) all obligations of the Company under the leases, licenses, and other occupancy agreements affecting the Property, to the extent arising from and after the Closing Date;
(c) all obligations of the Company under service contracts, management agreements, equipment leases, and other agreements to which the Company is a party, to the extent arising from and after the Closing Date; and
(d) all obligations of the Assignee as the sole member of the Company under the Amended and Restated Operating Agreement.
By accepting this assignment, the Assignee acknowledges that it has been afforded the opportunity to conduct due diligence with respect to the Company, the Property, and the Membership Interests, and that it is relying upon its own investigation and the representations and warranties expressly set forth in the Purchase Agreement in consummating the transactions contemplated hereby.
Section 2.3 — Retained Liabilities of Assignor
Notwithstanding any other provision of this Assignment, the Assignor shall retain and shall be solely responsible for all liabilities and obligations of or relating to the Company, the Property, or the Membership Interests to the extent attributable to the period prior to the Closing Date, except as otherwise expressly allocated, adjusted, or prorated pursuant to the proration and working-capital adjustment provisions of the Purchase Agreement (including Article IX and Exhibit U thereof). The indemnification rights and obligations of the Parties with respect to such retained liabilities shall be governed solely by the terms and conditions of the Purchase Agreement, including the following indemnification parameters set forth therein:
(a) a general representation cap of Fifty-Five Million Dollars ($55,000,000) (5.0% of the Purchase Price);
(b) a fundamental representation cap of One Hundred Ten Million Dollars ($110,000,000) (10.0% of the Purchase Price);
(c) a tipping basket in the amount of Five Million Five Hundred Thousand Dollars ($5,500,000) (0.5% of the Purchase Price), which, once exceeded, entitles the Assignee to recovery from the first dollar of losses;
(d) a de minimis threshold of Two Hundred Seventy-Five Thousand Dollars ($275,000) per individual claim, below which individual claims shall not be aggregated toward the tipping basket; and
(e) an indemnity escrow in the amount of Sixteen Million Five Hundred Thousand Dollars ($16,500,000) (1.5% of the Purchase Price), held by Commonwealth National Title Insurance Company as escrow agent pursuant to the Indemnity Escrow Agreement dated as of the Closing Date.
For the avoidance of doubt, nothing in this Assignment is intended to expand, limit, or otherwise modify the indemnification obligations of the Parties under the Purchase Agreement.
ARTICLE III — REPRESENTATIONS AND WARRANTIES OF ASSIGNOR
The Assignor hereby represents and warrants to the Assignee as of the Closing Date as follows:
Section 3.1 — Organization and Good Standing
The Assignor is a limited partnership duly organized, validly existing, and in good standing under the laws of the State of Delaware, and has all requisite partnership power and authority to own, lease, and operate its properties and to carry on its business as presently conducted. Greystone Meridian Capital LLC, as the sole general partner of the Assignor, is a limited liability company duly organized, validly existing, and in good standing under the laws of the State of Delaware, and has all requisite limited liability company power and authority to act on behalf of the Assignor in connection with the transactions contemplated by this Assignment.
Section 3.2 — Authority; Binding Effect
The Assignor has full power and authority to execute, deliver, and perform this Assignment and to consummate the transactions contemplated hereby. The execution, delivery, and performance of this Assignment by the Assignor and the consummation by the Assignor of the transactions contemplated hereby have been duly and validly authorized by all necessary action on the part of the Assignor and Greystone Meridian Capital LLC, as general partner, including any required approval by the advisory committee or limited partners of the Assignor, and no additional partnership, member, or other action on the part of the Assignor or its general partner is required. This Assignment has been duly executed and delivered by the Assignor and constitutes the legal, valid, and binding obligation of the Assignor, enforceable against the Assignor in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, and similar laws affecting creditors' rights generally and to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).
Section 3.3 — Title to Membership Interests
The Assignor is the sole record and beneficial owner of the Membership Interests, constituting one hundred percent (100%) of the issued and outstanding membership interests, economic interests, and other equity interests of any kind or nature in the Company. The Membership Interests are owned by the Assignor free and clear of all liens, pledges, security interests, encumbrances, charges, claims, equities, options, warrants, rights of first refusal, rights of first offer, preemptive rights, co-sale rights, tag-along rights, drag-along rights, and restrictions or limitations of any kind or nature, other than restrictions arising under the Operating Agreement and restrictions on transfer imposed by applicable federal and state securities laws of general applicability. There are no outstanding options, warrants, convertible securities, rights of first refusal, rights of first offer, or other rights to purchase, subscribe for, or otherwise acquire any membership interests or other equity interests in the Company. There are no outstanding agreements, commitments, or understandings, whether written or oral, relating to the issuance, sale, transfer, or voting of any membership interests or other equity interests in the Company.
Section 3.4 — No Conflicts
The execution, delivery, and performance of this Assignment by the Assignor and the consummation by the Assignor of the transactions contemplated hereby do not and will not (a) conflict with, result in a breach of, or constitute a default under the certificate of limited partnership, limited partnership agreement, or other organizational documents of the Assignor or the certificate of formation, limited liability company agreement, or other organizational documents of Greystone Meridian Capital LLC or the Company; (b) violate any applicable law, statute, regulation, rule, order, judgment, or decree applicable to the Assignor, the Company, or any of their respective properties or assets; or (c) conflict with, result in a breach of, constitute a default under, or give rise to any right of termination, cancellation, acceleration, or other remedy under any material agreement, contract, instrument, mortgage, lien, lease, permit, license, or other arrangement to which the Assignor or the Company is a party or by which the Assignor, the Company, or any of their respective properties or assets is bound, in each case after giving effect to the Lender Consent and all other consents, approvals, and authorizations obtained in connection with the transactions contemplated by the Purchase Agreement.
Section 3.5 — Consents
All consents, approvals, authorizations, permits, licenses, filings, registrations, and notifications required for the execution, delivery, and performance of this Assignment by the Assignor and the consummation of the transactions contemplated hereby have been duly obtained, given, or made, as applicable, including, without limitation, the Lender Consent from Pinnacle Federal Bank, N.A. to the change of control of the Company resulting from this Assignment. Each such consent, approval, and authorization is in full force and effect and has not been revoked, withdrawn, or modified in any material respect.
Section 3.6 — Bring-Down of Representations
The Assignor hereby confirms that the representations and warranties of the Seller set forth in the Purchase Agreement, as qualified by the disclosure schedules delivered thereunder, are true and correct in all material respects as of the Closing Date (or, to the extent such representations and warranties are made as of a specific date, as of such specific date), as more particularly set forth in the Seller's Closing Certificate executed by the Assignor concurrently herewith and delivered to the Assignee pursuant to the Purchase Agreement.
ARTICLE IV — REPRESENTATIONS AND WARRANTIES OF ASSIGNEE
The Assignee hereby represents and warrants to the Assignor as of the Closing Date as follows:
Section 4.1 — Organization and Good Standing
The Assignee is a real estate investment trust duly organized, validly existing, and in good standing under the laws of the State of Maryland. The Assignee has all requisite trust power and authority to own, lease, and operate its properties and to carry on its business as presently conducted. The Assignee is duly qualified to transact business and is in good standing in each jurisdiction in which the nature of its business or the ownership, leasing, or operation of its properties makes such qualification necessary, except where the failure to be so qualified would not have a material adverse effect on the Assignee's ability to consummate the transactions contemplated hereby.
Section 4.2 — Authority; Binding Effect
The Assignee has full power and authority to execute, deliver, and perform this Assignment and to consummate the transactions contemplated hereby. The board of trustees of Fairwater Real Estate Investment Trust has duly authorized the execution, delivery, and performance of this Assignment and the consummation of the transactions contemplated hereby, and no additional trust, shareholder, or other action on the part of the Assignee is required. This Assignment has been duly executed and delivered by the Assignee and constitutes the legal, valid, and binding obligation of the Assignee, enforceable against the Assignee in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, and similar laws affecting creditors' rights generally and to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).
Section 4.3 — No Conflicts
The execution, delivery, and performance of this Assignment by the Assignee and the consummation by the Assignee of the transactions contemplated hereby do not and will not (a) conflict with, result in a breach of, or constitute a default under the declaration of trust, bylaws, or other organizational documents of the Assignee; (b) violate any applicable law, statute, regulation, rule, order, judgment, or decree applicable to the Assignee or any of its properties or assets; or (c) conflict with, result in a breach of, constitute a default under, or give rise to any right of termination, cancellation, acceleration, or other remedy under any material agreement, contract, instrument, mortgage, lien, lease, permit, license, or other arrangement to which the Assignee is a party or by which the Assignee or any of its properties or assets is bound.
Section 4.4 — Financial Capacity
The Assignee has, or has access to, sufficient funds to consummate the transactions contemplated by this Assignment and the Purchase Agreement and to pay the Purchase Price (as allocated to the Company in accordance with the Purchase Agreement) and all related costs, fees, and expenses. Without limiting the generality of the foregoing, the Assignee has available borrowing capacity under its Seven Hundred Fifty Million Dollar ($750,000,000) unsecured revolving credit facility with Aldgate National Bank, N.A., as administrative agent, which facility is in full force and effect, undrawn to the extent necessary to fund the transactions contemplated hereby, and not subject to any conditions to borrowing that have not been satisfied or waived. The Assignee further represents that, as of the Closing Date, it satisfies the replacement guarantor financial covenants required by the Lender in connection with the Replacement Carve-Out Guaranty, including (a) a minimum tangible net worth of not less than Five Hundred Million Dollars ($500,000,000) and (b) minimum liquid assets of not less than Fifty Million Dollars ($50,000,000), in each case as determined in accordance with the definitions and calculation methodologies set forth in the Master Loan Agreement.
ARTICLE V — COMPANY INFORMATION
Section 5.1 — Company Details
The Parties hereby acknowledge and confirm the following details regarding the Company:
Full Legal Name: GMP Murfreesboro LLC
Jurisdiction of Formation: State of Delaware
Federal Employer Identification Number: 84-2527856
Entity Type: Single-purpose entity; limited liability company
Property Owned: Murfreesboro Distribution Center, 1600 Joe B. Jackson Parkway, Murfreesboro, Tennessee 37127
Property Type: Logistics / Distribution
Approximate Rentable square Footage: 502,000 square feet
Year Built: 2020
Loan Designation: Loan 1-H under the Master Loan Agreement dated September 15, 2020, between the Company and Pinnacle Federal Bank, N.A.
Foreign Qualification: Qualified to transact business in the State of Tennessee
Section 5.2 — Operating Agreement
The Operating Agreement of the Company shall be amended and restated in its entirety effective as of the Closing Date to reflect Fairwater Real Estate Investment Trust as the sole member of the Company and to set forth such governance and management provisions as the Assignee shall determine. Reference is hereby made to the Amended and Restated Limited Liability Company Agreement of GMP Murfreesboro LLC, dated as of June 6, 2024, executed by Fairwater Real Estate Investment Trust as the sole member of the Company concurrently herewith, the terms of which are incorporated herein by reference. From and after the Closing Date, the Amended and Restated Limited Liability Company Agreement shall supersede and replace the Operating Agreement in its entirety.
ARTICLE VI — COVENANTS AND AGREEMENTS
Section 6.1 — Further Assurances
Each Party hereby agrees, from time to time after the Closing Date, to execute and deliver, or cause to be executed and delivered, such additional documents, instruments, conveyances, and assurances, and to take or cause to be taken such further actions, as may be reasonably necessary or desirable to carry out the provisions of this Assignment and the Purchase Agreement and to give effect to the transactions contemplated hereby and thereby. Without limiting the foregoing, each Party shall cooperate fully and in good faith with the other Party in connection with any filing, application, or proceeding required to be made with or before any governmental authority in connection with the consummation of the transactions contemplated hereby.
Section 6.2 — Post-Closing Filings
The Assignee shall be responsible, at its sole cost and expense, for preparing and filing any necessary amendments, certificates, or updates with the Delaware Secretary of State to reflect the change in membership and management of the Company resulting from the transactions contemplated by this Assignment, including, without limitation, any amendment to the certificate of formation of the Company, if applicable. The Assignee shall further be responsible for updating the Company's foreign qualification filings with the Tennessee Secretary of State to reflect any changes in the registered agent, registered office, or other required information, as necessary to maintain the Company's good standing and qualification to transact business in the State of Tennessee.
Section 6.3 — Transition of Property Management
The Parties acknowledge and agree that, concurrently with the execution and delivery of this Assignment, the Assignor has caused its affiliate, Argyle Property Services LLC, and the Assignee has caused its affiliate, Fairwater Property Management LLC, to enter into that certain Transition Services Agreement dated as of June 6, 2024 (the "Transition Services Agreement"), pursuant to which Argyle Property Services LLC will provide property management transition services with respect to the Property and the other properties acquired pursuant to the Purchase Agreement for a period of ninety (90) days following the Closing Date (the "Transition Period"), at a fee of Three Hundred Seventy-Five Thousand Dollars ($375,000) per month (One Million One Hundred Twenty-Five Thousand Dollars ($1,125,000) in the aggregate for the Transition Period). During the Transition Period, the Parties shall cooperate in good faith to ensure a smooth and orderly transition of property management functions, tenant relations, vendor relationships, and operational responsibilities from Argyle Property Services LLC to Fairwater Property Management LLC.
Section 6.4 — Tenant Notification
Promptly following the Closing Date, and in any event within five (5) business days thereof, the Assignee shall cause tenant notification letters to be prepared and delivered to all tenants of the Property, notifying such tenants of the change of ownership of the Company and the Property, the designation of Fairwater Property Management LLC as the new property manager, and providing updated contact information, rent payment instructions, and such other information as may be required by the terms of the applicable leases or by applicable law. Copies of all such tenant notification letters shall be provided to the Assignor concurrently with delivery to the tenants.
Section 6.5 — Operating Account Transition
The Parties shall cooperate in good faith to effect the transition of the Company's operating accounts maintained at Magnolia Commerce Bank, N.A. (located at 225 Peachtree Street NE, Suite 100, Atlanta, Georgia 30303; relationship contact: Linda Prescott, Vice President, Commercial Banking) to reflect the removal of the Assignor's designated authorized signatories and the addition of new authorized signatories designated by the Assignee, in each case effective as of the Closing Date or as soon as reasonably practicable thereafter. The Assignor shall execute and deliver, or cause to be executed and delivered, such signature cards, corporate resolutions, and other documentation as may be reasonably requested by Magnolia Commerce Bank, N.A. to effectuate such transition. To the extent the Assignee elects to transfer the Company's operating accounts to a different financial institution, the Parties shall cooperate in the orderly transition of such accounts.
ARTICLE VII — PRORATIONS AND ADJUSTMENTS
Section 7.1 — Proration Date
All items required to be prorated between the Assignor and the Assignee with respect to the Company and the Property shall be prorated as of 11:59 p.m. Eastern Time on June 5, 2024 (the "Proration Date"), such that the Assignor shall be responsible for all income and expenses attributable to the period ending on and including the Proration Date, and the Assignee shall be responsible for all income and expenses attributable to the period from and after the Closing Date, June 6, 2024.
Section 7.2 — Reference to Purchase Agreement
All prorations, adjustments, and working-capital settlements with respect to the Company and the Property shall be calculated, allocated, and settled in accordance with the proration and adjustment provisions of the Purchase Agreement, including Article IX thereof and the proration methodology set forth in Exhibit U to the Purchase Agreement. Without limiting the foregoing, items to be prorated or adjusted include, but are not limited to: (a) real property taxes and assessments; (b) common area maintenance charges and operating expense reconciliation amounts; (c) utility charges; (d) rent and other tenant charges collected or receivable; (e) prepaid expenses; and (f) any other items customarily prorated in transactions of this nature. The preliminary proration statement with respect to the Company and the Property has been agreed upon by the Parties as of the Closing Date, and such preliminary proration statement is subject to a final post-closing true-up and reconciliation, which shall be completed within ninety (90) days following the Closing Date (the deadline for such final true-up being September 4, 2024), in accordance with the procedures set forth in the Purchase Agreement.
Section 7.3 — Security Deposits
At or prior to the Closing, all tenant security deposits held by the Company in its accounts (whether in the form of cash, letters of credit, or other instruments) shall be transferred to the control of the Assignee, or shall remain in Company accounts that are under the Assignee's control following the operating account transition described in Section 6.5 hereof. The aggregate tenant security deposits held across the entire fourteen (14)-property portfolio being acquired pursuant to the Purchase Agreement total approximately Four Million Two Hundred Eighty-Three Thousand Dollars ($4,283,000), with the Company's allocable share thereof being as set forth in the preliminary closing proration statement delivered at the Closing. From and after the Closing Date, the Assignee shall be solely responsible for holding, maintaining, and returning all tenant security deposits in accordance with the terms of the applicable leases and in compliance with applicable law, including any requirements of the State of Tennessee regarding the custody and return of security deposits.
ARTICLE VIII — INDEMNIFICATION
Section 8.1 — Cross-Reference to Purchase Agreement
The indemnification rights and obligations of the Assignor and the Assignee with respect to the Company, the Membership Interests, and the Property shall be governed solely and exclusively by the indemnification provisions set forth in the Purchase Agreement (including Article X thereof), and shall not be governed by or arise under this Assignment. All claims for indemnification, all limitations on liability, all survival periods, and all procedures for making and resolving indemnification claims shall be as set forth in the Purchase Agreement. Without limiting the foregoing, the Parties acknowledge that the sum of Sixteen Million Five Hundred Thousand Dollars ($16,500,000) has been deposited into an indemnity escrow account held by Commonwealth National Title Insurance Company, in its capacity as escrow agent, pursuant to the Indemnity Escrow Agreement dated as of the Closing Date (the "Indemnity Escrow Agreement"), which escrow fund shall serve as a source of recovery for certain indemnification claims of the Assignee under the Purchase Agreement. The general representations and warranties of the Assignor under the Purchase Agreement shall survive the Closing for a period of eighteen (18) months following the Closing Date (expiring on December 6, 2025). The tax representations and warranties of the Assignor under the Purchase Agreement shall survive the Closing for a period of thirty-six (36) months following the Closing Date (expiring on June 6, 2027). Fundamental representations shall survive in accordance with the terms specified in the Purchase Agreement.
Section 8.2 — Representations and Warranties Insurance
The Parties acknowledge that, concurrently with the Closing, the Assignee has obtained a buyer-side representations and warranties insurance policy (the "R&W Policy") issued by Sentinel Specialty Insurance Company (Policy No. SPC-2024-041287), with a policy limit of Fifty-Five Million Dollars ($55,000,000) and a retention (self-insured amount) of Eleven Million Dollars ($11,000,000), which retention shall decrease to Five Million Five Hundred Thousand Dollars ($5,500,000) at twelve (12) months following the Closing Date. The R&W Policy provides additional coverage to the Assignee for losses arising from breaches of the representations and warranties made by the Assignor under the Purchase Agreement, subject to the terms, conditions, and exclusions set forth in the R&W Policy. The existence of the R&W Policy shall not limit or otherwise affect the indemnification obligations of the Assignor under the Purchase Agreement, except to the extent expressly provided therein.
ARTICLE IX — MISCELLANEOUS
Section 9.1 — Governing Law
This Assignment shall be governed by, and construed and enforced in accordance with, the laws of the State of New York, without regard to any principles of conflicts of law that would result in the application of the laws of any other jurisdiction, consistent with the governing law provisions of the Purchase Agreement. Notwithstanding the foregoing, matters relating to the creation, perfection, priority, and enforcement of liens and security interests in and to the Property, and matters relating to the real property laws applicable to the Property, shall be governed by the laws of the State of Tennessee. Matters relating to the internal affairs of the Company, including the formation, organization, governance, and dissolution of the Company and the rights and obligations of its members, shall be governed by the Delaware Limited Liability Company Act, 6 Del. C. §18-101 et seq.
Section 9.2 — Successors and Assigns
This Assignment shall be binding upon, and shall inure to the benefit of, the Parties and their respective heirs, executors, administrators, legal representatives, successors, and permitted assigns. Neither Party may assign its rights or obligations under this Assignment without the prior written consent of the other Party, except in connection with assignments permitted under the Purchase Agreement.
Section 9.3 — Entire Agreement
This Assignment, together with the Purchase Agreement, the Indemnity Escrow Agreement, the Transition Services Agreement, the Amended and Restated Operating Agreement, the Assumption Agreement — Pinnacle Loans, and the other transaction documents executed in connection therewith (collectively, the "Transaction Documents"), constitutes the entire agreement between the Parties with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements, understandings, negotiations, representations, and warranties, whether written or oral, with respect thereto. In the event of any conflict or inconsistency between the terms and provisions of this Assignment and the terms and provisions of the Purchase Agreement, the terms and provisions of the Purchase Agreement shall control and govern.
Section 9.4 — Amendments
This Assignment may not be amended, modified, supplemented, or otherwise changed except by a written instrument duly executed and delivered by both the Assignor and the Assignee. No oral agreement, course of dealing, or course of performance shall be effective to amend or modify this Assignment.
Section 9.5 — Counterparts
This Assignment may be executed in two or more counterparts, each of which shall be deemed an original and all of which, when taken together, shall constitute one and the same instrument. The exchange of copies of this Assignment and of signature pages by electronic mail in portable document format (.pdf) or by any other electronic means intended to preserve the original graphic and pictorial appearance of a document shall constitute effective execution and delivery of this Assignment as to the Parties and may be used in lieu of the original Assignment for all purposes. Electronic signatures and signatures transmitted by .pdf shall be deemed original signatures for all purposes.
Section 9.6 — Severability
If any provision of this Assignment is held to be invalid, illegal, or unenforceable in any respect by a court of competent jurisdiction, such invalidity, illegality, or unenforceability shall not affect any other provision of this Assignment, and this Assignment shall be reformed, construed, and enforced as if such invalid, illegal, or unenforceable provision had never been contained herein, provided that the economic and legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to either Party.
Section 9.7 — Notices
All notices, requests, demands, consents, approvals, and other communications required or permitted to be given under this Assignment shall be in writing and shall be delivered in accordance with the notice provisions set forth in the Purchase Agreement. For purposes of this Assignment, the notice addresses of the Parties shall be as follows:
If to the Assignor:
Greystone Meridian Partners Fund III, L.P. 3300 Peachtree Road NE, Suite 2200 Atlanta, Georgia 30326
Attention: Victor Lansdell
Telephone: (404) 555-0178
Email: vlansdell@greystonemeridian.com
With a copy to (which shall not constitute notice):
Blackridge Hayes LLP 1285 Avenue of the Americas, 34th Floor New York, New York 10019
Attention: Nathaniel Pryce
Telephone: (212) 555-0243
Email: npryce@blackridgehayes.com
If to the Assignee:
Fairwater Real Estate Investment Trust 7200 Chesapeake Parkway, Suite 1100 Columbia, Maryland 21044
Attention: David Elgin Park, General Counsel
Telephone: (410) 555-0391
Email: dpark@fairwaterreit.com
With a copy to (which shall not constitute notice):
Calderwood & Harkness LLP 450 Park Avenue, 28th Floor New York, New York 10022
Attention: Douglas Fairchild
Telephone: (212) 555-0517
Email: dfairchild@calderwoodharkness.com
Section 9.8 — Waiver
No failure or delay by either Party in exercising any right, power, or remedy under this Assignment shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, power, or remedy preclude any other or further exercise thereof or the exercise of any other right, power, or remedy. No waiver of any provision of this Assignment shall be effective unless made in writing and signed by the Party granting such waiver.
Section 9.9 — No Third-Party Beneficiaries
Nothing in this Assignment, whether express or implied, is intended to or shall confer upon any person or entity other than the Parties and their respective successors and permitted assigns any rights, remedies, obligations, or liabilities of any nature whatsoever under or by reason of this Assignment; provided, however, that Pinnacle Federal Bank, N.A. shall be an express third-party beneficiary of the representations, warranties, and covenants set forth in this Assignment to the extent such representations, warranties, and covenants relate to the assumed mortgage loan, Loan 1-H, and the assumed mortgage loan documents described in Exhibit B attached hereto, and Pinnacle Federal Bank, N.A. shall be entitled to enforce such provisions directly against the relevant Party.
[Signature Pages Follow]
IN WITNESS WHEREOF, the Parties have executed this Assignment and Assumption of Membership Interests as of the date first written above.
ASSIGNOR:
GREYSTONE MERIDIAN PARTNERS FUND III, L.P., a Delaware limited partnership
By: Greystone Meridian Capital LLC,
a Delaware limited liability company, its General Partner
By: ________
Name: Victor Lansdell
Title: Co-Founder & Managing Partner
Date: June 6, 2024
ASSIGNEE:
FAIRWATER REAL ESTATE INVESTMENT TRUST, a Maryland real estate investment trust
By: ________
Name: Marcus Devereaux
Title: Executive Vice President, Acquisitions
Date: June 6, 2024
ACKNOWLEDGMENT AND CONSENT OF THE COMPANY
GMP Murfreesboro LLC, by its authorized representative, hereby acknowledges and consents to the assignment and assumption of the Membership Interests effected by this Assignment and Assumption of Membership Interests, dated as of June 6, 2024, by and between Greystone Meridian Partners Fund III, L.P. and Fairwater Real Estate Investment Trust. The Company hereby confirms that, effective as of the Closing Date, Fairwater Real Estate Investment Trust is the sole member of the Company, holding one hundred percent (100%) of the issued and outstanding membership interests therein, and that the Amended and Restated Limited Liability Company Agreement of the Company, dated as of the Closing Date, shall govern the affairs of the Company from and after such date.
GMP MURFREESBORO LLC, a Delaware limited liability company
By: Greystone Meridian Partners Fund III, L.P.,
a Delaware limited partnership (in its capacity as the sole member of the Company immediately prior to the Closing Date, authorizing this consent as of immediately prior to the effective time of the assignment)
By: Greystone Meridian Capital LLC,
a Delaware limited liability company, its General Partner
By: ________
Name: Elise Rathborne
Title: Co-Founder & Managing Partner
Date: June 6, 2024
EXHIBIT A
PROPERTY DESCRIPTION
The real property owned by GMP Murfreesboro LLC and commonly known as Murfreesboro Distribution Center is more particularly described as follows:
Common Address: 1600 Joe B. Jackson Parkway, Murfreesboro, Tennessee 37127
County: Rutherford County, Tennessee
Tax Parcel Number(s): 094-035.00; 094-035.01
Approximate Rentable square Footage: 502,000 square feet
Legal Description (Metes and Bounds):
BEING a tract of land situated in the Twelfth (12th) Civil District of Rutherford County, State of Tennessee, lying on the south side of Joe B. Jackson Parkway (State Route 96), and being more particularly described as follows:
BEGINNING at an iron pin set in the south right-of-way margin of Joe B. Jackson Parkway (State Route 96), said pin being located South 86 degrees 42 minutes 18 seconds East, a distance of 1,247.32 feet from the intersection of the south margin of Joe B. Jackson Parkway with the east margin of Aldermere Private Capital Boulevard; thence, leaving said right-of-way margin, South 03 degrees 17 minutes 42 seconds West, a distance of 1,892.41 feet to an iron pin; thence South 86 degrees 42 minutes 18 seconds East, a distance of 1,523.68 feet to an iron pin; thence North 03 degrees 17 minutes 42 seconds East, a distance of 1,892.41 feet to an iron pin set in the south right-of-way margin of Joe B. Jackson Parkway; thence along said right-of-way margin, North 86 degrees 42 minutes 18 seconds West, a distance of 1,523.68 feet to the POINT OF BEGINNING.
Containing 66.22 acres, more or less.
TOGETHER WITH all buildings, structures, improvements, and fixtures now or hereafter located on the above-described land, and all easements, rights-of-way, rights of ingress and egress, water rights, air rights, mineral rights (to the extent owned), development rights, entitlements, privileges, hereditaments, and appurtenances thereunto belonging or in anywise appertaining.
BEING the same property conveyed to GMP Murfreesboro LLC, a Delaware limited liability company, by Special Warranty Deed from Jackson Logistics Development Company, LLC, a Tennessee limited liability company, dated August 14, 2020, recorded August 17, 2020, in Deed Book 1482, Page 237, Register's Office, Rutherford County, Tennessee.
Reference Survey: ALTA/NSPS Land Title Survey prepared by Meridian Land Surveying, Inc. (Daniel Caulfield, P.L.S., P.E., Tennessee License No. 2847), Job No. MLS-2024-0291, dated March 22, 2024, last revised May 15, 2024, certified to Fairwater Real Estate Investment Trust, Commonwealth National Title Insurance Company, and Pinnacle Federal Bank, N.A.
EXHIBIT B
SCHEDULE OF ASSUMED LOAN DOCUMENTS (Company-Specific — GMP Murfreesboro LLC / Loan 1-H)
The following is a list of the loan documents specific to GMP Murfreesboro LLC under the Pinnacle Federal Bank, N.A. lending facility, all of which are being assumed by the Assignee as of the Closing Date (collectively, the "Assumed Loan Documents"):