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Purchase Agreement

 

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Title:

Purchase Agreement

Entities:

FrontLine Capital Group

Date:

2000

Size:

Preview shows 7KB of 64KB total

Price:

$50

ID:

#1115804

 

 

► Purchase & Sale ► Purchase Agreements
► Real Estate ► Real Estate Agents & Managers

 

 

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                              PURCHASE AGREEMENT



PURCHASE AGREEMENT, dated as of May 31, 2000, by and between
FrontLine Capital Group, a Delaware corporation ("FCG"), and First Union Real
Estate Equity and Mortgage Investments, an Ohio real estate investment trust
(the "Investor").

WHEREAS, HQ Global Workplaces Inc., a Delaware corporation ("Old
HQ"), and CarrAmerica Realty Corporation, a Maryland corporation
("CarrAmerica"), on the one hand, and VANTAS Incorporated, a Nevada
corporation ("VANTAS"), and FCG, on the other hand, have entered into that
certain Agreement and Plan of Merger, dated as of January 20, 2000, as amended
as of April 29, 2000 and as of May 30, 2000 (as amended, the "Merger
Agreement").

WHEREAS, pursuant to the Merger Agreement, VANTAS will merge with and
into Old HQ with Old HQ continuing as the surviving corporation with the name
"HQ Global Workplaces, Inc." (the "HQ Merger").

WHEREAS, FCG and CarrAmerica have entered into that certain Stock
Purchase Agreement, dated as of January 20, 2000, as amended as of April 29,
2000 (as amended, the "Stock Purchase Agreement"), whereby FCG agreed to
purchase from CarrAmerica 4,130,530 (subject to recalculation as provided
therein) shares of non-voting common stock, par value $.01 per share (the "Old
HQ Common Stock"), of Old HQ.

WHEREAS, immediately following the consummation of the HQ Merger and
the transactions contemplated by the Stock Purchase Agreement and that certain
Stock Purchase Agreement, dated as of January 20, 2000, as amended as of April
29, 2000, among FCG, VANTAS, CarrAmerica, Omni Offices UK Limited and Omni
Offices (Lux) 1929 Holding Company S.A. (the "UK Stock Purchase Agreement"),
Old HQ, as the surviving corporation of the HQ Merger ("HQ Surviving
Corporation"), will merge (the "Second Step Merger") with and into newly
formed HQ Merger Subsidiary, Inc., a Delaware corporation ("M-Sub") that is a
wholly owned subsidiary of HQ Global Holdings, Inc., a Delaware corporation
("Holdco"), which will theretofore be wholly owned by HQ Surviving
Corporation, with M-Sub continuing as the surviving corporation under the name
"HQ Global Workplaces Inc." pursuant to the Agreement and Plan of Merger
related thereto (the "Second Step Merger Agreement").

WHEREAS, pursuant to the Exchange Agreement, dated as of May 31, 2000
(the "Exchange Agreement"), Holdco and FCG have agreed to exchange 4,130,530
shares of common stock of Holdco ("Common Shares") to be received by FCG in
the Second Step Merger in exchange for the Old HQ Common Stock to be purchased
by FCG from CarrAmerica and certain other persons pursuant to the Stock
Purchase Agreement for 3,704,933.820 newly issued shares of Series A
Convertible Cumulative Preferred Stock (the "Preferred Stock") of Holdco and
warrants to purchase up to 1,660,341.752 shares of voting common stock, par
value $.01 per share (the "Voting Common Stock"), of Holdco.

WHEREAS, upon consummation of the transactions contemplated in the
Exchange Agreement, FCG desires to sell to the Investor, and the Investor
desires to purchase from FCG, the certain securities on the terms and
conditions specified in this Agreement.

WHEREAS, capitalized words and phrases used but not otherwise defined
herein shall have the meanings ascribed to them under the Merger Agreement.

Accordingly, FCG and the Investor hereby agree as follows:

1. Purchase and Sale of Securities. (a) On the terms and subject to
the conditions of this Agreement, (i) FCG agrees to sell to the Investor, and
the Investor agrees to purchase from FCG, for $10 million (the "Purchase
Price") (A) 245,266.257 newly issued shares of Preferred Stock (the "Preferred
Shares"), the terms of which are contained in the certificate of designations
to Holdco's certificate of incorporation (the "Certificate of Designations")
in the form attached as Exhibit A hereto, having an initial liquidation
preference equal to $10 million and (B) warrants to purchase up to 109,914.462
shares of Voting Common Stock (the "Warrants"), the terms of which are in the
form attached as Exhibit B hereto in respect of Warrants to purchase
74,121.436 shares of Common Stock (the "Initial Warrants") and in Exhibit C
hereto in respect of Warrants to purchase 35,793.026 shares of Common Stock.

(b) The closing (the "Closing") of the purchase and sale of the
securities referred to in clause (a) above shall be held at the offices of
Brown & Wood LLP, One World Trade Center, New York, New York 10048,
immediately after, and on the same date as, the Closing under the Merger
Agreement, subject to the satisfaction or waiver of the conditions set forth
in Section 5 hereof. The date on which the Closing shall occur, which shall
not extend beyond June 5, 2000, is hereinafter referred to as the "Closing
Date," and, if the Closing Date is not May 31, 2000, FCG shall notify the
Investor prior to the close of the business on the business day immediately
preceding the Closing Date. On the Closing Date, (i) FCG shall deliver
certificates issued in the Investor's name representing the Preferred Shares
and the Warrants, and (ii) the Investor shall deposit the Purchase Price in
immediately available funds with Citibank, N.A., as escrow agent (the "Escrow
Agent") under the Escrow Agreement, dated as of May 31, 2000 (the "Escrow
Agreement"), for payment to FCG; it being understood that the Closing shall
occur, and the Preferred Shares, Warrants and Purchase Price only released
from escrow, in accordance with the terms and conditions set forth in the
Escrow Agreement.

2. Representations and Warranties of FCG. FCG hereby represents and
warrants to the Investor as of the date hereof and as of the Closing Date as
to the following matters:

(a) Organization and Standing. FCG is a corporation duly
organized, validly existing and in good standing as a corporation under the
laws of the State of Delaware. FCG and its subsidiaries have all requisite
corporate power and authority necessary to carry on their respective
businesses as presently conducted and to enable them to own, lease or
otherwise hold their respective properties and assets. FCG and its
subsidiaries are duly qualified to do business and in good standing in each
jurisdiction in which the conduct or nature of their respective businesses or
the ownership, leasing or holding of their respective properties or assets
makes such qualification necessary, except any such jurisdiction where the

 

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