x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Maryland
|
|
27-1627696
|
(State or Other Jurisdiction of
Incorporation or Organization)
|
|
(I.R.S. Employer
Identification No.)
|
800 Newport Center Drive, Suite 700
Newport Beach, California
|
|
92660
|
(Address of Principal Executive Offices)
|
|
(Zip Code)
|
Large Accelerated Filer
|
|
¨
|
|
Accelerated Filer
|
|
¨
|
Non-Accelerated Filer
|
|
x
|
|
Smaller reporting company
|
|
¨
|
|
|
|
|
Emerging growth company
|
|
¨
|
Title of each class
|
Trading Symbol(s)
|
Name of each exchange on which registered
|
None
|
N/A
|
N/A
|
PART I.
|
|||
|
Item 1.
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
Item 2.
|
||
|
Item 3.
|
||
|
Item 4.
|
||
PART II.
|
|||
|
Item 1.
|
||
|
Item 1A.
|
||
|
Item 2.
|
||
|
Item 3.
|
||
|
Item 4.
|
||
|
Item 5.
|
||
|
Item 6.
|
||
|
|
June 30, 2019
|
|
December 31, 2018
|
||||
|
|
(unaudited)
|
|
|
||||
Assets
|
|
|
|
|
||||
Real estate:
|
|
|
|
|
||||
Land
|
|
$
|
401,150
|
|
|
$
|
402,008
|
|
Buildings and improvements
|
|
2,936,372
|
|
|
2,911,995
|
|
||
Construction in progress
|
|
50,595
|
|
|
35,785
|
|
||
Tenant origination and absorption costs
|
|
202,342
|
|
|
223,723
|
|
||
Total real estate held for investment, cost
|
|
3,590,459
|
|
|
3,573,511
|
|
||
Less accumulated depreciation and amortization
|
|
(579,249
|
)
|
|
(536,990
|
)
|
||
Total real estate held for investment, net
|
|
3,011,210
|
|
|
3,036,521
|
|
||
Cash and cash equivalents
|
|
66,080
|
|
|
75,023
|
|
||
Restricted cash
|
|
5,970
|
|
|
1,015
|
|
||
Rents and other receivables, net
|
|
104,441
|
|
|
98,411
|
|
||
Above-market leases, net
|
|
3,452
|
|
|
4,176
|
|
||
Prepaid expenses and other assets
|
|
84,356
|
|
|
85,645
|
|
||
Total assets
|
|
$
|
3,275,509
|
|
|
$
|
3,300,791
|
|
Liabilities and equity
|
|
|
|
|
||||
Notes payable, net
|
|
$
|
2,275,768
|
|
|
$
|
2,184,538
|
|
Accounts payable and accrued liabilities
|
|
74,588
|
|
|
67,265
|
|
||
Due to affiliate
|
|
4,741
|
|
|
4,209
|
|
||
Distributions payable
|
|
9,485
|
|
|
9,801
|
|
||
Below-market leases, net
|
|
14,729
|
|
|
17,553
|
|
||
Redeemable common stock payable
|
|
16,476
|
|
|
31,647
|
|
||
Other liabilities
|
|
49,987
|
|
|
30,396
|
|
||
Total liabilities
|
|
2,445,774
|
|
|
2,345,409
|
|
||
Commitments and contingencies (Note 9)
|
|
|
|
|
|
|
||
Redeemable common stock
|
|
15,631
|
|
|
24,487
|
|
||
Equity
|
|
|
|
|
||||
KBS Real Estate Investment Trust III, Inc. stockholders’ equity
|
|
|
|
|
||||
Preferred stock, $.01 par value per share; 10,000,000 shares authorized, no shares issued and outstanding
|
|
—
|
|
|
—
|
|
||
Common stock, $.01 par value per share; 1,000,000,000 shares authorized, 175,001,561 and 177,523,853 shares issued and outstanding as of June 30, 2019 and December 31, 2018, respectively
|
|
1,750
|
|
|
1,775
|
|
||
Additional paid-in capital
|
|
1,550,351
|
|
|
1,555,380
|
|
||
Cumulative distributions and net losses
|
|
(738,263
|
)
|
|
(626,543
|
)
|
||
Total KBS Real Estate Investment Trust III, Inc. stockholders’ equity
|
|
813,838
|
|
|
930,612
|
|
||
Noncontrolling interest
|
|
266
|
|
|
283
|
|
||
Total equity
|
|
814,104
|
|
|
930,895
|
|
||
Total liabilities and equity
|
|
$
|
3,275,509
|
|
|
$
|
3,300,791
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Revenues:
|
|
|
|
|
|
|
|
||||||||
Rental income
|
$
|
105,843
|
|
|
$
|
98,794
|
|
|
$
|
208,850
|
|
|
$
|
195,416
|
|
Other operating income
|
8,666
|
|
|
8,782
|
|
|
17,037
|
|
|
16,339
|
|
||||
Total revenues
|
114,509
|
|
|
107,576
|
|
|
225,887
|
|
|
211,755
|
|
||||
Expenses:
|
|
|
|
|
|
|
|
||||||||
Operating, maintenance and management
|
26,279
|
|
|
24,301
|
|
|
50,013
|
|
|
47,455
|
|
||||
Real estate taxes and insurance
|
18,418
|
|
|
18,487
|
|
|
35,865
|
|
|
35,261
|
|
||||
Asset management fees to affiliate
|
6,999
|
|
|
6,738
|
|
|
13,871
|
|
|
13,358
|
|
||||
General and administrative expenses
|
1,907
|
|
|
2,012
|
|
|
3,942
|
|
|
3,535
|
|
||||
Depreciation and amortization
|
41,632
|
|
|
39,025
|
|
|
83,040
|
|
|
78,006
|
|
||||
Interest expense
|
47,403
|
|
|
12,517
|
|
|
85,350
|
|
|
13,327
|
|
||||
Impairment charges on real estate
|
—
|
|
|
—
|
|
|
8,706
|
|
|
—
|
|
||||
Total expenses
|
142,638
|
|
|
103,080
|
|
|
280,787
|
|
|
190,942
|
|
||||
Other income (loss):
|
|
|
|
|
|
|
|
||||||||
Other income
|
9
|
|
|
1,575
|
|
|
22
|
|
|
1,876
|
|
||||
Other interest income
|
192
|
|
|
84
|
|
|
264
|
|
|
96
|
|
||||
Equity in income (loss) of unconsolidated joint venture
|
—
|
|
|
(348
|
)
|
|
—
|
|
|
(348
|
)
|
||||
Loss from extinguishment of debt
|
(196
|
)
|
|
—
|
|
|
(196
|
)
|
|
—
|
|
||||
Gain on sale of real estate, net
|
—
|
|
|
11,942
|
|
|
—
|
|
|
11,942
|
|
||||
Total other income, net
|
5
|
|
|
13,253
|
|
|
90
|
|
|
13,566
|
|
||||
Net (loss) income
|
(28,124
|
)
|
|
17,749
|
|
|
(54,810
|
)
|
|
34,379
|
|
||||
Net loss attributable to noncontrolling interest
|
9
|
|
|
—
|
|
|
17
|
|
|
—
|
|
||||
Net (loss) income attributable to common stockholders
|
$
|
(28,115
|
)
|
|
$
|
17,749
|
|
|
$
|
(54,793
|
)
|
|
$
|
34,379
|
|
Net (loss) income per common share attributable to common stockholders, basic and diluted
|
$
|
(0.16
|
)
|
|
$
|
0.10
|
|
|
$
|
(0.31
|
)
|
|
$
|
0.19
|
|
Weighted-average number of common shares outstanding, basic and diluted
|
174,783,611
|
|
|
177,649,492
|
|
|
175,154,320
|
|
|
178,588,342
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net (loss) income
|
$
|
(28,124
|
)
|
|
$
|
17,749
|
|
|
$
|
(54,810
|
)
|
|
$
|
34,379
|
|
Other comprehensive (loss) income:
|
|
|
|
|
|
|
|
||||||||
Unrealized (loss) income on derivative instruments designated as cash flow hedges
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
83
|
|
||||
Reclassification adjustment realized in net income
(effective portion)
|
—
|
|
|
(96
|
)
|
|
—
|
|
|
(108
|
)
|
||||
Total other comprehensive loss
|
—
|
|
|
(97
|
)
|
|
—
|
|
|
(25
|
)
|
||||
Total comprehensive (loss) income
|
(28,124
|
)
|
|
17,652
|
|
|
(54,810
|
)
|
|
34,354
|
|
||||
Total comprehensive loss attributable to noncontrolling interest
|
9
|
|
|
—
|
|
|
17
|
|
|
—
|
|
||||
Total comprehensive (loss) income attributable to common stockholders
|
$
|
(28,115
|
)
|
|
$
|
17,652
|
|
|
$
|
(54,793
|
)
|
|
$
|
34,354
|
|
|
|
Common Stock |
|
Additional Paid-in Capital
|
|
Cumulative Distributions in Excess of Net Income (Loss)
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Total Stockholders’ Equity
|
|
Noncontrolling Interest
|
|
Total Equity
|
|||||||||||||||||
|
|
Shares
|
|
Amounts
|
|
|
|
|
|
||||||||||||||||||||||
Balance, March 31, 2019
|
|
174,110,694
|
|
|
$
|
1,741
|
|
|
$
|
1,550,411
|
|
|
$
|
(681,744
|
)
|
|
$
|
—
|
|
|
$
|
870,408
|
|
|
$
|
275
|
|
|
$
|
870,683
|
|
Net loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(28,115
|
)
|
|
—
|
|
|
(28,115
|
)
|
|
(9
|
)
|
|
(28,124
|
)
|
|||||||
Issuance of common stock
|
|
1,136,045
|
|
|
11
|
|
|
12,963
|
|
|
—
|
|
|
—
|
|
|
12,974
|
|
|
—
|
|
|
12,974
|
|
|||||||
Transfers to redeemable common stock
|
|
—
|
|
|
—
|
|
|
(10,080
|
)
|
|
—
|
|
|
—
|
|
|
(10,080
|
)
|
|
—
|
|
|
(10,080
|
)
|
|||||||
Redemptions of common stock
|
|
(245,178
|
)
|
|
(2
|
)
|
|
(2,942
|
)
|
|
—
|
|
|
—
|
|
|
(2,944
|
)
|
|
—
|
|
|
(2,944
|
)
|
|||||||
Distributions declared
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(28,404
|
)
|
|
—
|
|
|
(28,404
|
)
|
|
—
|
|
|
(28,404
|
)
|
|||||||
Other offering costs
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|||||||
Balance, June 30, 2019
|
|
175,001,561
|
|
|
$
|
1,750
|
|
|
$
|
1,550,351
|
|
|
$
|
(738,263
|
)
|
|
$
|
—
|
|
|
$
|
813,838
|
|
|
$
|
266
|
|
|
$
|
814,104
|
|
|
|
Common Stock |
|
Additional Paid-in Capital
|
|
Cumulative Distributions in Excess of Net Income (Loss)
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Total Stockholders’ Equity
|
|
Noncontrolling Interest
|
|
Total Equity
|
|||||||||||||||||
|
|
Shares
|
|
Amounts
|
|
|
|
|
|
||||||||||||||||||||||
Balance, March 31, 2018
|
|
176,993,282
|
|
|
$
|
1,770
|
|
|
$
|
1,591,679
|
|
|
$
|
(526,594
|
)
|
|
$
|
182
|
|
|
$
|
1,067,037
|
|
|
$
|
300
|
|
|
$
|
1,067,337
|
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
17,749
|
|
|
—
|
|
|
17,749
|
|
|
—
|
|
|
17,749
|
|
|||||||
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(97
|
)
|
|
(97
|
)
|
|
—
|
|
|
(97
|
)
|
|||||||
Issuance of common stock
|
|
1,276,061
|
|
|
12
|
|
|
14,216
|
|
|
—
|
|
|
—
|
|
|
14,228
|
|
|
—
|
|
|
14,228
|
|
|||||||
Transfers to redeemable common stock
|
|
—
|
|
|
—
|
|
|
(23,954
|
)
|
|
—
|
|
|
—
|
|
|
(23,954
|
)
|
|
—
|
|
|
(23,954
|
)
|
|||||||
Redemptions of common stock
|
|
(2,995,169
|
)
|
|
(29
|
)
|
|
(33,558
|
)
|
|
—
|
|
|
—
|
|
|
(33,587
|
)
|
|
—
|
|
|
(33,587
|
)
|
|||||||
Distributions declared
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(28,778
|
)
|
|
—
|
|
|
(28,778
|
)
|
|
—
|
|
|
(28,778
|
)
|
|||||||
Balance, June 30, 2018
|
|
175,274,174
|
|
|
$
|
1,753
|
|
|
$
|
1,548,383
|
|
|
$
|
(537,623
|
)
|
|
$
|
85
|
|
|
$
|
1,012,598
|
|
|
$
|
300
|
|
|
$
|
1,012,898
|
|
|
|
Common Stock
|
|
Additional Paid-in Capital
|
|
Cumulative Distributions in Excess of Net Income (Loss)
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Total Stockholders’ Equity
|
|
Noncontrolling Interest
|
|
Total Equity
|
|||||||||||||||||
|
|
Shares
|
|
Amounts
|
|
|
|
|
|
||||||||||||||||||||||
Balance, December 31, 2018
|
|
177,523,853
|
|
|
$
|
1,775
|
|
|
$
|
1,555,380
|
|
|
$
|
(626,543
|
)
|
|
$
|
—
|
|
|
$
|
930,612
|
|
|
$
|
283
|
|
|
$
|
930,895
|
|
Net loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(54,793
|
)
|
|
—
|
|
|
(54,793
|
)
|
|
(17
|
)
|
|
(54,810
|
)
|
|||||||
Issuance of common stock
|
|
2,317,868
|
|
|
23
|
|
|
26,448
|
|
|
—
|
|
|
—
|
|
|
26,471
|
|
|
—
|
|
|
26,471
|
|
|||||||
Transfers from redeemable common stock
|
|
—
|
|
|
—
|
|
|
24,028
|
|
|
—
|
|
|
—
|
|
|
24,028
|
|
|
—
|
|
|
24,028
|
|
|||||||
Redemptions of common stock
|
|
(4,840,160
|
)
|
|
(48
|
)
|
|
(55,502
|
)
|
|
—
|
|
|
—
|
|
|
(55,550
|
)
|
|
—
|
|
|
(55,550
|
)
|
|||||||
Distributions declared
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(56,927
|
)
|
|
—
|
|
|
(56,927
|
)
|
|
—
|
|
|
(56,927
|
)
|
|||||||
Other offering costs
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
|||||||
Balance, June 30, 2019
|
|
175,001,561
|
|
|
$
|
1,750
|
|
|
$
|
1,550,351
|
|
|
$
|
(738,263
|
)
|
|
$
|
—
|
|
|
$
|
813,838
|
|
|
$
|
266
|
|
|
$
|
814,104
|
|
|
|
Common Stock |
|
Additional Paid-in Capital
|
|
Cumulative Distributions in Excess of Net Income (Loss)
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Total Stockholders’ Equity
|
|
Noncontrolling Interest
|
|
Total Equity
|
|||||||||||||||||
|
|
Shares
|
|
Amounts
|
|
|
|
|
|
||||||||||||||||||||||
Balance, December 31, 2017
|
|
180,864,707
|
|
|
$
|
1,809
|
|
|
$
|
1,591,640
|
|
|
$
|
(514,451
|
)
|
|
$
|
110
|
|
|
$
|
1,079,108
|
|
|
$
|
300
|
|
|
$
|
1,079,408
|
|
Net income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
34,379
|
|
|
—
|
|
|
34,379
|
|
|
—
|
|
|
34,379
|
|
|||||||
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(25
|
)
|
|
(25
|
)
|
|
—
|
|
|
(25
|
)
|
|||||||
Issuance of common stock
|
|
2,556,146
|
|
|
25
|
|
|
28,476
|
|
|
—
|
|
|
—
|
|
|
28,501
|
|
|
—
|
|
|
28,501
|
|
|||||||
Transfers from redeemable common stock
|
|
—
|
|
|
—
|
|
|
21,557
|
|
|
—
|
|
|
—
|
|
|
21,557
|
|
|
—
|
|
|
21,557
|
|
|||||||
Redemptions of common stock
|
|
(8,146,679
|
)
|
|
(81
|
)
|
|
(93,290
|
)
|
|
—
|
|
|
—
|
|
|
(93,371
|
)
|
|
—
|
|
|
(93,371
|
)
|
|||||||
Distributions declared
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(57,551
|
)
|
|
—
|
|
|
(57,551
|
)
|
|
—
|
|
|
(57,551
|
)
|
|||||||
Balance, June 30, 2018
|
|
175,274,174
|
|
|
$
|
1,753
|
|
|
$
|
1,548,383
|
|
|
$
|
(537,623
|
)
|
|
$
|
85
|
|
|
$
|
1,012,598
|
|
|
$
|
300
|
|
|
$
|
1,012,898
|
|
|
|
Six Months Ended June 30,
|
||||||
|
|
2019
|
|
2018
|
||||
Cash Flows from Operating Activities:
|
|
|
|
|
||||
Net (loss) income
|
|
$
|
(54,810
|
)
|
|
$
|
34,379
|
|
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
|
|
|
|
|
||||
Depreciation and amortization
|
|
83,040
|
|
|
78,006
|
|
||
Impairment charges on real estate
|
|
8,706
|
|
|
—
|
|
||
Equity in loss of unconsolidated joint venture
|
|
—
|
|
|
348
|
|
||
Deferred rents
|
|
(3,026
|
)
|
|
(4,947
|
)
|
||
Loss due to property damage
|
|
90
|
|
|
—
|
|
||
Bad debt expense
|
|
—
|
|
|
110
|
|
||
Amortization of above- and below-market leases, net
|
|
(2,100
|
)
|
|
(2,587
|
)
|
||
Amortization of deferred financing costs
|
|
3,185
|
|
|
3,091
|
|
||
Loss from extinguishment of debt
|
|
196
|
|
|
—
|
|
||
Unrealized losses (gains) on derivative instruments
|
|
37,899
|
|
|
(25,326
|
)
|
||
Gain on sale of real estate
|
|
—
|
|
|
(11,942
|
)
|
||
Changes in operating assets and liabilities:
|
|
|
|
|
||||
Rents and other receivables
|
|
(3,149
|
)
|
|
(3,067
|
)
|
||
Prepaid expenses and other assets
|
|
(19,213
|
)
|
|
(7,918
|
)
|
||
Accounts payable and accrued liabilities
|
|
(3,438
|
)
|
|
(5,113
|
)
|
||
Other liabilities
|
|
(2,853
|
)
|
|
(2,586
|
)
|
||
Due to affiliates
|
|
399
|
|
|
695
|
|
||
Net cash provided by operating activities
|
|
44,926
|
|
|
53,143
|
|
||
Cash Flows from Investing Activities:
|
|
|
|
|
||||
Improvements to real estate
|
|
(35,199
|
)
|
|
(45,931
|
)
|
||
Proceeds from sale of real estate, net
|
|
—
|
|
|
41,649
|
|
||
Payments for construction in progress
|
|
(14,017
|
)
|
|
(19,092
|
)
|
||
Investment in unconsolidated joint venture
|
|
—
|
|
|
(428
|
)
|
||
Payments of post-closing acquisition costs
|
|
(338
|
)
|
|
—
|
|
||
Escrow deposits for tenant improvements
|
|
972
|
|
|
1,111
|
|
||
Insurance proceeds received for property damage
|
|
519
|
|
|
3,928
|
|
||
Net cash used in investing activities
|
|
(48,063
|
)
|
|
(18,763
|
)
|
||
Cash Flows from Financing Activities:
|
|
|
|
|
||||
Proceeds from notes payable
|
|
283,830
|
|
|
126,168
|
|
||
Principal payments on notes payable
|
|
(193,664
|
)
|
|
(39,266
|
)
|
||
Payments of deferred financing costs
|
|
(4,692
|
)
|
|
(108
|
)
|
||
Payments to redeem common stock
|
|
(55,550
|
)
|
|
(93,296
|
)
|
||
Payments of other offering costs
|
|
(3
|
)
|
|
—
|
|
||
Distributions paid to common stockholders
|
|
(30,772
|
)
|
|
(29,533
|
)
|
||
Net cash used in financing activities
|
|
(851
|
)
|
|
(36,035
|
)
|
||
Net decrease in cash, cash equivalents and restricted cash
|
|
(3,988
|
)
|
|
(1,655
|
)
|
||
Cash, cash equivalents and restricted cash, beginning of period
|
|
76,038
|
|
|
65,486
|
|
||
Cash, cash equivalents and restricted cash, end of period
|
|
$
|
72,050
|
|
|
$
|
63,831
|
|
Supplemental Disclosure of Cash Flow Information:
|
|
|
|
|
||||
Interest paid, net of capitalized interest of $1,067 and $2,150 for the six months ended June 30, 2019 and 2018, respectively
|
|
$
|
43,659
|
|
|
$
|
35,001
|
|
Supplemental Disclosure of Noncash Investing and Financing Activities:
|
|
|
|
|
||||
Distributions payable
|
|
$
|
9,485
|
|
|
$
|
9,499
|
|
Redeemable common stock payable
|
|
$
|
16,476
|
|
|
$
|
6,257
|
|
Accrued improvements to real estate
|
|
$
|
27,061
|
|
|
$
|
20,730
|
|
Construction in progress payable
|
|
$
|
6,616
|
|
|
$
|
8,158
|
|
Acquisition fee related to construction in progress due to affiliate
|
|
$
|
1,049
|
|
|
$
|
745
|
|
Acquisition fee on unconsolidated joint venture due to affiliate
|
|
$
|
—
|
|
|
$
|
451
|
|
Distributions paid to common stockholders through common stock issuances pursuant to the dividend reinvestment plan
|
|
$
|
26,471
|
|
|
$
|
28,501
|
|
1.
|
ORGANIZATION
|
2.
|
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
|
•
|
whether the lease stipulates how a tenant improvement allowance may be spent;
|
•
|
whether the lessee or lessor supervises the construction and bears the risk of cost overruns;
|
•
|
whether the amount of a tenant improvement allowance is in excess of market rates;
|
•
|
whether the tenant or landlord retains legal title to the improvements at the end of the lease term;
|
•
|
whether the tenant improvements are unique to the tenant or general purpose in nature; and
|
•
|
whether the tenant improvements are expected to have any residual value at the end of the lease.
|
3.
|
REAL ESTATE
|
Property
|
|
Date Acquired
|
|
City
|
|
State
|
|
Property Type
|
|
Total Real Estate,
at Cost (1) |
|
Accumulated Depreciation and Amortization
(1)
|
|
Total Real Estate, Net
(1)
|
||||||
Domain Gateway
|
|
09/29/2011
|
|
Austin
|
|
TX
|
|
Office
|
|
$
|
49,574
|
|
|
$
|
(15,014
|
)
|
|
$
|
34,560
|
|
Town Center
|
|
03/27/2012
|
|
Plano
|
|
TX
|
|
Office
|
|
114,355
|
|
|
(28,443
|
)
|
|
85,912
|
|
|||
McEwen Building
|
|
04/30/2012
|
|
Franklin
|
|
TN
|
|
Office
|
|
36,316
|
|
|
(8,213
|
)
|
|
28,103
|
|
|||
Gateway Tech Center
|
|
05/09/2012
|
|
Salt Lake City
|
|
UT
|
|
Office
|
|
27,466
|
|
|
(7,281
|
)
|
|
20,185
|
|
|||
Tower on Lake Carolyn
(2)
|
|
12/21/2012
|
|
Irving
|
|
TX
|
|
Office
|
|
53,253
|
|
|
(13,509
|
)
|
|
39,744
|
|
|||
RBC Plaza
|
|
01/31/2013
|
|
Minneapolis
|
|
MN
|
|
Office
|
|
153,078
|
|
|
(41,459
|
)
|
|
111,619
|
|
|||
One Washingtonian Center
(2)
|
|
06/19/2013
|
|
Gaithersburg
|
|
MD
|
|
Office
|
|
93,273
|
|
|
(20,763
|
)
|
|
72,510
|
|
|||
Preston Commons
|
|
06/19/2013
|
|
Dallas
|
|
TX
|
|
Office
|
|
119,772
|
|
|
(25,623
|
)
|
|
94,149
|
|
|||
Sterling Plaza
|
|
06/19/2013
|
|
Dallas
|
|
TX
|
|
Office
|
|
79,452
|
|
|
(15,099
|
)
|
|
64,353
|
|
|||
201 Spear Street
|
|
12/03/2013
|
|
San Francisco
|
|
CA
|
|
Office
|
|
145,279
|
|
|
(17,364
|
)
|
|
127,915
|
|
|||
Accenture Tower
(3)
|
|
12/16/2013
|
|
Chicago
|
|
IL
|
|
Office
|
|
444,835
|
|
|
(78,048
|
)
|
|
366,787
|
|
|||
222 Main
(2)
|
|
02/27/2014
|
|
Salt Lake City
|
|
UT
|
|
Office
|
|
165,839
|
|
|
(33,968
|
)
|
|
131,871
|
|
|||
Anchor Centre
|
|
05/22/2014
|
|
Phoenix
|
|
AZ
|
|
Office
|
|
96,005
|
|
|
(16,874
|
)
|
|
79,131
|
|
|||
171 17th Street
(2)
|
|
08/25/2014
|
|
Atlanta
|
|
GA
|
|
Office
|
|
135,156
|
|
|
(30,975
|
)
|
|
104,181
|
|
|||
Reston Square
(2)
|
|
12/03/2014
|
|
Reston
|
|
VA
|
|
Office
|
|
46,785
|
|
|
(9,781
|
)
|
|
37,004
|
|
|||
Ten Almaden
|
|
12/05/2014
|
|
San Jose
|
|
CA
|
|
Office
|
|
126,187
|
|
|
(20,658
|
)
|
|
105,529
|
|
|||
Towers at Emeryville
(4)
|
|
12/23/2014
|
|
Emeryville
|
|
CA
|
|
Office
|
|
285,882
|
|
|
(37,940
|
)
|
|
247,942
|
|
|||
101 South Hanley
(2)
|
|
12/24/2014
|
|
St. Louis
|
|
MO
|
|
Office
|
|
72,730
|
|
|
(13,460
|
)
|
|
59,270
|
|
|||
3003 Washington Boulevard
|
|
12/30/2014
|
|
Arlington
|
|
VA
|
|
Office
|
|
151,059
|
|
|
(22,884
|
)
|
|
128,175
|
|
|||
Village Center Station
(2)
|
|
05/20/2015
|
|
Greenwood Village
|
|
CO
|
|
Office
|
|
76,240
|
|
|
(11,756
|
)
|
|
64,484
|
|
|||
Park Place Village
|
|
06/18/2015
|
|
Leawood
|
|
KS
|
|
Office/Retail
|
|
100,493
|
|
|
(1,182
|
)
|
|
99,311
|
|
|||
201 17th Street
|
|
06/23/2015
|
|
Atlanta
|
|
GA
|
|
Office
|
|
102,090
|
|
|
(16,597
|
)
|
|
85,493
|
|
|||
Promenade I & II at Eilan
(2)
|
|
07/14/2015
|
|
San Antonio
|
|
TX
|
|
Office
|
|
62,720
|
|
|
(11,051
|
)
|
|
51,669
|
|
|||
CrossPoint at Valley Forge
(2)
|
|
08/18/2015
|
|
Wayne
|
|
PA
|
|
Office
|
|
90,412
|
|
|
(13,739
|
)
|
|
76,673
|
|
|||
515 Congress
|
|
08/31/2015
|
|
Austin
|
|
TX
|
|
Office
|
|
120,875
|
|
|
(14,889
|
)
|
|
105,986
|
|
|||
The Almaden
|
|
09/23/2015
|
|
San Jose
|
|
CA
|
|
Office
|
|
174,118
|
|
|
(19,587
|
)
|
|
154,531
|
|
|||
3001 Washington Boulevard
|
|
11/06/2015
|
|
Arlington
|
|
VA
|
|
Office
|
|
60,717
|
|
|
(5,994
|
)
|
|
54,723
|
|
|||
Carillon
|
|
01/15/2016
|
|
Charlotte
|
|
NC
|
|
Office
|
|
152,949
|
|
|
(19,875
|
)
|
|
133,074
|
|
|||
Hardware Village
(5)
|
|
08/26/2016
|
|
Salt Lake City
|
|
UT
|
|
Development/Apartment
|
|
121,437
|
|
|
(3,014
|
)
|
|
118,423
|
|
|||
Village Center Station II
(2)
|
|
10/11/2018
|
|
Greenwood Village
|
|
CO
|
|
Office
|
|
132,112
|
|
|
(4,209
|
)
|
|
127,903
|
|
|||
|
|
|
|
|
|
|
|
|
|
$
|
3,590,459
|
|
|
$
|
(579,249
|
)
|
|
$
|
3,011,210
|
|
Property
|
|
Location
|
|
Rentable
Square Feet |
|
Total Real Estate, Net
(in thousands) |
|
Percentage
of Total Assets |
|
Annualized Base Rent
(in thousands) (1) |
|
Average Annualized Base Rent per sq. ft.
|
|
Occupancy
|
|||||||||
Accenture Tower
|
|
Chicago, IL
|
|
1,457,724
|
|
|
$
|
366,787
|
|
|
11.2
|
%
|
|
$
|
30,001
|
|
|
$
|
27.73
|
|
|
74.2
|
%
|
July 1, 2019 through December 31, 2019
|
$
|
153,750
|
|
2020
|
306,971
|
|
|
2021
|
286,489
|
|
|
2022
|
255,234
|
|
|
2023
|
217,821
|
|
|
Thereafter
|
725,031
|
|
|
|
$
|
1,945,296
|
|
Industry
|
|
Number of Tenants
|
|
Annualized Base Rent
(1)
(in thousands) |
|
Percentage of Annualized Base Rent
|
|||
Finance
|
|
156
|
|
$
|
60,059
|
|
|
18.8
|
%
|
Real Estate
|
|
80
|
|
33,325
|
|
|
10.4
|
%
|
|
|
For the Three Months Ended June 30, 2018
|
|
For the Six Months Ended June 30, 2018
|
||||
Revenues
|
|
|
|
|
||||
Rental income
|
|
$
|
699
|
|
|
$
|
1,886
|
|
Other operating income
|
|
1
|
|
|
26
|
|
||
Total revenues
|
|
$
|
700
|
|
|
$
|
1,912
|
|
Expenses
|
|
|
|
|
||||
Operating, maintenance, and management
|
|
$
|
142
|
|
|
$
|
462
|
|
Real estate taxes and insurance
|
|
71
|
|
|
213
|
|
||
Asset management fees to affiliate
|
|
62
|
|
|
127
|
|
||
Depreciation and amortization
|
|
—
|
|
|
—
|
|
||
Interest expense
|
|
127
|
|
|
320
|
|
||
Total expenses
|
|
$
|
402
|
|
|
$
|
1,122
|
|
4.
|
TENANT ORIGINATION AND ABSORPTION COSTS, ABOVE-MARKET LEASE ASSETS AND BELOW-MARKET LEASE LIABILITIES
|
|
Tenant Origination and
Absorption Costs
|
|
Above-Market
Lease Assets
|
|
Below-Market
Lease Liabilities
|
||||||||||||||||||
|
June 30, 2019
|
|
December 31, 2018
|
|
June 30, 2019
|
|
December 31, 2018
|
|
June 30, 2019
|
|
December 31, 2018
|
||||||||||||
Cost
|
$
|
202,342
|
|
|
$
|
223,723
|
|
|
$
|
9,883
|
|
|
$
|
11,118
|
|
|
$
|
(36,682
|
)
|
|
$
|
(40,601
|
)
|
Accumulated Amortization
|
(111,484
|
)
|
|
(117,955
|
)
|
|
(6,431
|
)
|
|
(6,942
|
)
|
|
21,953
|
|
|
23,048
|
|
||||||
Net Amount
|
$
|
90,858
|
|
|
$
|
105,768
|
|
|
$
|
3,452
|
|
|
$
|
4,176
|
|
|
$
|
(14,729
|
)
|
|
$
|
(17,553
|
)
|
5.
|
NOTES PAYABLE
|
|
|
Book Value as of
June 30, 2019
|
|
Book Value as of
December 31, 2018
|
|
Contractual Interest Rate as of
June 30, 2019 (1) |
|
Effective Interest Rate as of
June 30, 2019
(1)
|
|
Payment Type
|
|
Maturity Date
(2)
|
||||
Portfolio Loan
(3)
(4)
|
|
$
|
84,484
|
|
|
$
|
84,484
|
|
|
One-month LIBOR + 1.90%
|
|
4.34%
|
|
Interest Only
|
|
06/01/2020
|
222 Main Mortgage Loan
(3)
|
|
96,518
|
|
|
97,522
|
|
|
3.97%
|
|
3.97%
|
|
Principal & Interest
|
|
03/01/2021
|
||
Anchor Centre Mortgage Loan
|
|
49,345
|
|
|
49,647
|
|
|
One-month LIBOR + 1.50%
|
|
3.94%
|
|
Principal & Interest
|
|
06/01/2020
|
||
171 17th Street Mortgage Loan
(3)
|
|
84,045
|
|
|
84,460
|
|
|
One-month LIBOR + 1.45%
|
|
3.89%
|
|
Principal & Interest
|
|
09/01/2019
|
||
Reston Square Mortgage Loan
(3)
|
|
29,304
|
|
|
29,479
|
|
|
One-month LIBOR + 1.50%
|
|
3.87%
|
|
Principal & Interest
|
|
02/01/2020
|
||
101 South Hanley Mortgage Loan
(3)
|
|
43,651
|
|
|
43,090
|
|
|
One-month LIBOR + 1.55%
|
|
3.94%
|
|
Principal & Interest
|
|
01/01/2020
|
||
3003 Washington Boulevard Mortgage Loan
(5)
|
|
—
|
|
|
90,378
|
|
|
(5)
|
|
(5)
|
|
(5)
|
|
(5)
|
||
201 17th Street Mortgage Loan
(6)
|
|
64,428
|
|
|
64,428
|
|
|
One-month LIBOR + 1.40%
|
|
3.62%
|
|
Interest Only
|
|
08/01/2019
|
||
CrossPoint at Valley Forge Mortgage Loan
(3) (7)
|
|
51,000
|
|
|
51,000
|
|
|
One-month LIBOR + 1.50%
|
|
3.33%
|
|
Interest Only
(7)
|
|
09/01/2022
|
||
The Almaden Mortgage Loan
|
|
93,000
|
|
|
93,000
|
|
|
4.20%
|
|
4.20%
|
|
Interest Only
|
|
01/01/2022
|
||
Promenade I & II at Eilan Mortgage Loan
(3)
|
|
37,300
|
|
|
37,300
|
|
|
One-month LIBOR + 1.75%
|
|
3.57%
|
|
Interest Only
|
|
10/01/2022
|
||
201 Spear Street Mortgage Loan
|
|
125,000
|
|
|
125,000
|
|
|
One-month LIBOR + 1.45%
|
|
3.88%
|
|
Interest Only
|
|
01/05/2024
|
||
Carillon Mortgage Loan
(8)
|
|
111,000
|
|
|
92,197
|
|
|
One-month LIBOR + 1.40%
|
|
3.31%
|
|
Interest Only
|
|
04/11/2024
|
||
3001 Washington Boulevard Mortgage Loan
(9)
|
|
—
|
|
|
32,662
|
|
|
(9)
|
|
(9)
|
|
(9)
|
|
(9)
|
||
Hardware Village Loan Facility
(10)
|
|
63,626
|
|
|
49,664
|
|
|
One-month LIBOR + 3.25%
|
|
5.67%
|
|
Interest Only
|
|
02/23/2020
|
||
Portfolio Loan Facility
(11)
|
|
932,500
|
|
|
893,500
|
|
|
One-month LIBOR + 1.80%
|
|
3.84%
|
|
Interest Only
|
|
11/03/2020
|
||
Village Center Station II Loan
(3)
|
|
77,875
|
|
|
78,343
|
|
|
One-month LIBOR + 1.70%
|
|
4.14%
|
|
Principal & Interest
|
|
03/01/2022
|
||
Portfolio Revolving Loan Facility
(12)
|
|
200,000
|
|
|
200,000
|
|
|
One-month LIBOR + 1.50%
|
|
3.77%
|
|
Interest Only
|
|
11/01/2021
|
||
3001 & 3003 Washington Mortgage Loan
(7) (13)
|
|
143,245
|
|
|
—
|
|
|
One-month LIBOR + 1.45%
|
|
3.89%
|
|
Interest Only
(7)
|
|
06/01/2024
|
||
Total notes payable principal outstanding
|
|
2,286,321
|
|
|
2,196,154
|
|
|
|
|
|
|
|
|
|
||
Deferred financing costs, net
|
|
(10,553
|
)
|
|
(11,616
|
)
|
|
|
|
|
|
|
|
|
||
Total notes payable, net
|
|
$
|
2,275,768
|
|
|
$
|
2,184,538
|
|
|
|
|
|
|
|
|
|
6.
|
DERIVATIVE INSTRUMENTS
|
|
|
June 30, 2019
|
|
December 31, 2018
|
|
|
|
Weighted-Average
Fix Pay Rate
|
|
Weighted-Average Remaining
Term in Years
|
||||||||
Derivative Instruments
|
|
Number of Instruments
|
|
Notional Amount
|
|
Number of Instruments
|
|
Notional Amount
|
|
Reference Rate as of
June 30, 2019
|
|
|
||||||
Derivative instruments not designated as hedging instruments
|
|
|
|
|
|
|
|
|
||||||||||
Interest rate swaps
|
|
12
|
|
$
|
1,375,574
|
|
|
14
|
|
$
|
1,208,957
|
|
|
One-month LIBOR/
Fixed at 1.67% - 2.51% |
|
2.14%
|
|
3.1
|
Interest rate cap
|
|
—
|
|
$
|
—
|
|
|
1
|
|
$
|
100,000
|
|
|
—
|
|
—%
|
|
—
|
|
For the Three Months Ended June 30,
|
|
For the Six Months Ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Income statement related
|
|
|
|
|
|
|
|
||||||||
Derivatives designated as hedging instruments
|
|
|
|
|
|
|
|
||||||||
Amount of (income) expense recognized on interest rate swaps (effective portion)
|
$
|
—
|
|
|
$
|
(96
|
)
|
|
$
|
—
|
|
|
$
|
(108
|
)
|
|
—
|
|
|
(96
|
)
|
|
—
|
|
|
(108
|
)
|
||||
Derivatives not designated as hedging instruments
|
|
|
|
|
|
|
|
||||||||
Realized (gain) loss recognized on interest rate swaps
|
(1,238
|
)
|
|
201
|
|
|
(2,627
|
)
|
|
1,309
|
|
||||
Unrealized loss (gain) on interest rate swaps
|
23,280
|
|
|
(7,289
|
)
|
|
37,899
|
|
|
(25,326
|
)
|
||||
|
22,042
|
|
|
(7,088
|
)
|
|
35,272
|
|
|
(24,017
|
)
|
||||
Increase (decrease) in interest expense as a result of derivatives
|
$
|
22,042
|
|
|
$
|
(7,184
|
)
|
|
$
|
35,272
|
|
|
$
|
(24,125
|
)
|
|
|
|
|
|
|
|
|
||||||||
Other comprehensive income related
|
|
|
|
|
|
|
|
||||||||
Unrealized (losses) income on derivative instruments
|
$
|
—
|
|
|
$
|
(1
|
)
|
|
$
|
—
|
|
|
$
|
83
|
|
7.
|
FAIR VALUE DISCLOSURES
|
•
|
Level 1: unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities;
|
•
|
Level 2: quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which significant inputs and significant value drivers are observable in active markets; and
|
•
|
Level 3: prices or valuation techniques where little or no market data is available that requires inputs that are both significant to the fair value measurement and unobservable.
|
|
|
June 30, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
|
Face Value
|
|
Carrying Amount
|
|
Fair Value
|
|
Face Value
|
|
Carrying Amount
|
|
Fair Value
|
||||||||||||
Financial liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Notes payable
|
|
$
|
2,286,321
|
|
|
$
|
2,275,768
|
|
|
$
|
2,295,347
|
|
|
$
|
2,196,154
|
|
|
$
|
2,184,538
|
|
|
$
|
2,202,587
|
|
|
|
|
|
Fair Value Measurements Using
|
||||||||||||
|
|
Total
|
|
Quoted Prices in Active Markets
for Identical Assets (Level 1) |
|
Significant Other Observable Inputs
(Level 2) |
|
Significant Unobservable Inputs
(Level 3) |
||||||||
Recurring Basis:
|
|
|
|
|
|
|
|
|
||||||||
Liability derivatives - interest rate swaps
|
|
$
|
22,445
|
|
|
$
|
—
|
|
|
$
|
22,445
|
|
|
$
|
—
|
|
|
|
|
|
Fair Value Measurements Using
|
||||||||||||
|
|
Total
|
|
Quoted Prices in Active Markets
for Identical Assets
(Level 1)
|
|
Significant Other Observable Inputs
(Level 2)
|
|
Significant Unobservable Inputs
(Level 3)
|
||||||||
Nonrecurring Basis:
|
|
|
|
|
|
|
|
|
||||||||
Impaired real estate
(1)
|
|
$
|
103,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
103,000
|
|
8.
|
RELATED PARTY TRANSACTIONS
|
|
Incurred
|
|
Payable as of
|
||||||||||||||||||||
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
|
June 30,
|
|
December 31,
|
||||||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||||
Expensed
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Asset management fees
(1)
|
$
|
6,999
|
|
|
$
|
6,738
|
|
|
$
|
13,871
|
|
|
$
|
13,358
|
|
|
$
|
2,314
|
|
|
$
|
2,559
|
|
Reimbursement of operating expenses
(2) (3)
|
636
|
|
|
956
|
|
|
1,163
|
|
|
1,102
|
|
|
1,378
|
|
|
734
|
|
||||||
Disposition fees
(4)
|
—
|
|
|
429
|
|
|
—
|
|
|
429
|
|
|
—
|
|
|
—
|
|
||||||
Capitalized
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Acquisition fee on development project
|
88
|
|
|
110
|
|
|
133
|
|
|
179
|
|
|
1,049
|
|
|
916
|
|
||||||
Acquisition fee on unconsolidated joint venture
|
—
|
|
|
69
|
|
|
—
|
|
|
162
|
|
|
—
|
|
|
—
|
|
||||||
|
$
|
7,723
|
|
|
$
|
8,302
|
|
|
$
|
15,167
|
|
|
$
|
15,230
|
|
|
$
|
4,741
|
|
|
$
|
4,209
|
|
9.
|
COMMITMENTS AND CONTINGENCIES
|
10.
|
SUBSEQUENT EVENTS
|
•
|
We are dependent on KBS Capital Advisors LLC (“KBS Capital Advisors”), our advisor, to identify investments, to manage our investments and for the disposition of our investments.
|
•
|
All of our executive officers, our affiliated director and other key real estate and debt finance professionals are also officers, affiliated directors, managers, key professionals and/or holders of a direct or indirect controlling interest in our advisor, our dealer manager and/or other KBS-affiliated entities. As a result, our executive officers, our affiliated director, some of our key real estate and debt finance professionals, our advisor and its affiliates face conflicts of interest, including significant conflicts created by our advisor’s and its affiliates’ compensation arrangements with us and other KBS-sponsored programs and KBS-advised investors and conflicts in allocating time among us and these other programs and investors. Furthermore, these individuals may become employees of another KBS-sponsored program in an internalization transaction or, if we internalize our advisor, may not become our employees as a result of their relationship with other KBS-sponsored programs. These conflicts could result in action or inaction that is not in the best interests of our stockholders.
|
•
|
Our advisor and its affiliates receive fees in connection with transactions involving the purchase or origination, management and disposition of our investments. Acquisition and asset management fees are based on the cost of the investment, and not based on the quality of the investment or the quality of the services rendered to us. This may influence our advisor to recommend riskier transactions to us. We may also pay significant fees during our listing/liquidation stage. Although most of the fees payable during our listing/liquidation stage are contingent on our stockholders first enjoying agreed-upon investment returns, the investment return thresholds may be reduced subject to approval by our conflicts committee and to other limitations in our charter. These payments increase the risk that our stockholders will not earn a profit on their investment in us and increase the risk of loss to our stockholders.
|
•
|
Our charter permits us to pay distributions from any source, including offering proceeds or borrowings (which may constitute a return of capital), and our charter does not limit the amount of funds we may use from any source to pay such distributions. From time to time during our operational stage, we may use proceeds from third party financings to fund at least a portion of distributions in anticipation of cash flow to be received in later periods. We may also fund such distributions from the sale of assets or from the maturity, payoff or settlement of any real estate-related investments, to the extent we make any such additional investments. If we pay distributions from sources other than our cash flow from operations, the overall return to our stockholders may be reduced.
|
•
|
We may incur debt until our total liabilities would exceed 75% of the cost of our tangible assets (before deducting depreciation and other non-cash reserves), and we may exceed this limit with the approval of the conflicts committee of our board of directors. To the extent financing in excess of this limit is available on attractive terms, our conflicts committee may approve debt such that our total liabilities would exceed this limit. High debt levels could limit the amount of cash we have available to distribute and could result in a decline in the value of an investment in us.
|
•
|
We depend on tenants for the revenue generated by our real estate investments and, accordingly, the revenue generated by our real estate investments is dependent upon the success and economic viability of our tenants. Revenues from our properties could decrease due to a reduction in occupancy (caused by factors including, but not limited to, tenant defaults, tenant insolvency, early termination of tenant leases and non-renewal of existing tenant leases) and/or lower rental rates, making it more difficult for us to meet our debt service obligations and limiting our ability to pay distributions to our stockholders.
|
•
|
Because investment opportunities that are suitable for us may also be suitable for other KBS-sponsored programs or KBS-advised investors, our advisor and its affiliates face conflicts of interest relating to the purchase of properties and other investments and such conflicts may not be resolved in our favor, meaning that we could invest in less attractive assets, which could reduce the investment return to our stockholders.
|
•
|
We cannot predict with any certainty how much, if any, of our dividend reinvestment plan proceeds will be available for general corporate purposes including, but not limited to: the repurchase of shares under our share redemption program; capital expenditures, tenant improvement costs and leasing costs related to our real estate properties; reserves required by any financings of our real estate investments; the acquisition or origination of real estate investments, which include payment of acquisition or origination fees to our advisor; and the repayment of debt. If such funds are not available from our dividend reinvestment plan offering, then we may have to use a greater proportion of our cash flow from operations to meet these cash requirements, which would reduce cash available for distributions and could limit our ability to redeem shares under our share redemption program.
|
•
|
Disruptions in the financial markets and uncertain economic conditions could adversely affect our ability to implement our business strategy and generate returns to stockholders. In addition, our real estate investments may be affected by unfavorable real estate market and general economic conditions, which could decrease the value of those assets and reduce the investment return to our stockholders.
|
•
|
Our charter does not require us to liquidate our assets and dissolve by a specified date, nor does our charter require our directors to list our shares for trading by a specified date. No public market currently exists for our shares of common stock, and we have no plans at this time to list our shares on a national securities exchange. Until our shares are listed, if ever, our stockholders may not sell their shares unless the buyer meets the applicable suitability and minimum purchase standards. Any sale must comply with applicable state and federal securities laws. In addition, our charter prohibits the ownership of more than 9.8% of our stock, unless exempted by our board of directors, which may inhibit large investors from purchasing our shares. Our shares cannot be readily sold and, if our stockholders are able to sell their shares, they would likely have to sell them at a substantial discount from the price our stockholders paid to acquire the shares and from our estimated value per share.
|
•
|
During any calendar year, we may redeem (i) only the number of shares that we could purchase with the amount of net proceeds from the sale of shares under our dividend reinvestment plan during the prior calendar year unless our board of directors authorizes additional funds for redemption and (ii) no more than 5% of the weighted average number of shares outstanding during the prior calendar year. As of July 31, 2019, we had
$5.1 million
available for Special Redemptions (defined herein) for the remainder of 2019. As of July 31, 2019, we had a total
$40.9 million
of outstanding and unfulfilled Ordinary Redemption (defined herein) requests, representing
3,583,572
shares. On August 8, 2019, our board of directors approved an increase of the funding available for Ordinary Redemptions for calendar year 2019 by up to an additional $40.0 million, which including redemptions fulfilled to date and the remaining amount reserved for Special Redemptions, increases the share redemption program to the maximum amount for 2019. Given the volume of redemption requests in 2019, and because of the limitations on the dollar amount of shares that may be redeemed under our share redemption program and the number of shares that may be redeemed during a calendar year, it is not likely that we will be able to redeem shares submitted as Ordinary Redemptions after the August 2019 redemption date and shares submitted as Ordinary Redemptions for the August 2019 redemption date will likely be honored on a pro rata basis pursuant to the terms of the share redemption program.
|
•
|
Although our board of directors has approved management’s recommendation to explore strategic alternatives for us, we are not obligated to pursue any particular transaction or any transaction at all. We can provide no assurance that we will be able to provide additional liquidity to stockholders. Stockholders may have to hold their shares for an indefinite period of time. Further, although we are exploring strategic alternatives, there is no assurance that this process will provide a return to stockholders that equals or exceeds our estimated value per share.
|
•
|
Cash flow generated by our real estate investments;
|
•
|
Debt financings (including amounts currently available under existing loan facilities);
|
•
|
Proceeds from the sale of our real estate properties; and
|
•
|
Proceeds from common stock issued under our dividend reinvestment plan.
|
•
|
$35.2 million used for improvements to real estate;
|
•
|
$14.0 million used for construction in progress related to Hardware Village;
|
•
|
$0.5 million of insurance proceeds received for property damage;
|
•
|
$0.9 million of escrow proceeds received for tenant improvements; and
|
•
|
$0.3 million used for post-closing acquisition costs related to the purchase of a joint venture partner’s equity interest in 2018.
|
•
|
$85.5 million of net cash provided by debt financing as a result of proceeds from notes payable of $283.8 million, partially offset by principal payments on notes payable of $193.6 million and payments of deferred financing costs of $4.7 million;
|
•
|
$55.6 million of cash used for redemptions and repurchases of common stock; and
|
•
|
$30.8 million of net cash distributions, after giving effect to distributions reinvested by stockholders of $26.5 million.
|
|
|
|
|
Payments Due During the Years Ended December 31,
|
||||||||||||||||
Contractual Obligations
|
|
Total
|
|
Remainder of 2019
|
|
2020-2021
|
|
2022-2023
|
|
Thereafter
|
||||||||||
Outstanding debt obligations
(1)
|
|
$
|
2,286,321
|
|
|
$
|
150,723
|
|
|
$
|
1,500,232
|
|
|
$
|
256,121
|
|
|
$
|
379,245
|
|
Interest payments on outstanding debt obligations
(2)
|
|
176,893
|
|
|
42,822
|
|
|
99,793
|
|
|
30,859
|
|
|
3,419
|
|
|||||
Development obligations
(3)
|
|
5,668
|
|
|
5,668
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
Three Months Ended June 30,
|
|
Increase (Decrease)
|
|
Percentage Change
|
|
$ Changes Due to Properties Completed and Disposed
(1)
|
|
$ Change Due to Properties Held
Throughout Both Periods
(2)
|
|||||||||||||
|
|
2019
|
|
2018
|
|
|
|
|
|||||||||||||||
Rental income
|
|
$
|
105,843
|
|
|
$
|
98,794
|
|
|
$
|
7,049
|
|
|
7
|
%
|
|
$
|
1,793
|
|
|
$
|
5,256
|
|
Other operating income
|
|
8,666
|
|
|
8,782
|
|
|
(116
|
)
|
|
(1
|
)%
|
|
204
|
|
|
(320
|
)
|
|||||
Operating, maintenance and management costs
|
|
26,279
|
|
|
24,301
|
|
|
1,978
|
|
|
8
|
%
|
|
347
|
|
|
1,631
|
|
|||||
Real estate taxes and insurance
|
|
18,418
|
|
|
18,487
|
|
|
(69
|
)
|
|
—
|
%
|
|
145
|
|
|
(214
|
)
|
|||||
Asset management fees to affiliate
|
|
6,999
|
|
|
6,738
|
|
|
261
|
|
|
4
|
%
|
|
189
|
|
|
72
|
|
|||||
General and administrative expenses
|
|
1,907
|
|
|
2,012
|
|
|
(105
|
)
|
|
(5
|
)%
|
|
n/a
|
|
|
n/a
|
|
|||||
Depreciation and amortization
|
|
41,632
|
|
|
39,025
|
|
|
2,607
|
|
|
7
|
%
|
|
2,269
|
|
|
338
|
|
|||||
Interest expense
|
|
47,403
|
|
|
12,517
|
|
|
34,886
|
|
|
279
|
%
|
|
n/a
|
|
|
n/a
|
|
|||||
Other income
|
|
9
|
|
|
1,575
|
|
|
(1,566
|
)
|
|
(100
|
)%
|
|
—
|
|
|
(1,566
|
)
|
|||||
Other interest income
|
|
192
|
|
|
84
|
|
|
108
|
|
|
129
|
%
|
|
n/a
|
|
|
n/a
|
|
|||||
Loss from extinguishment of debt
|
|
(196
|
)
|
|
—
|
|
|
(196
|
)
|
|
(100
|
)%
|
|
—
|
|
|
(196
|
)
|
|||||
Equity in income of unconsolidated joint venture
|
|
—
|
|
|
(348
|
)
|
|
348
|
|
|
(100
|
)%
|
|
348
|
|
|
—
|
|
|||||
Gain on sale of real estate, net
|
|
—
|
|
|
11,942
|
|
|
(11,942
|
)
|
|
(100
|
)%
|
|
(11,942
|
)
|
|
—
|
|
|
|
Six Months Ended June 30,
|
|
Increase (Decrease)
|
|
Percentage Change
|
|
$ Changes Due to Properties Completed and Disposed
(1)
|
|
$ Change Due to Properties Held
Throughout Both Periods
(2)
|
|||||||||||||
|
|
2019
|
|
2018
|
|
|
|
|
|||||||||||||||
Rental income
|
|
$
|
208,850
|
|
|
$
|
195,416
|
|
|
$
|
13,434
|
|
|
7
|
%
|
|
$
|
2,920
|
|
|
$
|
10,514
|
|
Other operating income
|
|
17,037
|
|
|
16,339
|
|
|
698
|
|
|
4
|
%
|
|
386
|
|
|
312
|
|
|||||
Operating, maintenance and management costs
|
|
50,013
|
|
|
47,455
|
|
|
2,558
|
|
|
5
|
%
|
|
589
|
|
|
1,969
|
|
|||||
Real estate taxes and insurance
|
|
35,865
|
|
|
35,261
|
|
|
604
|
|
|
2
|
%
|
|
69
|
|
|
535
|
|
|||||
Asset management fees to affiliate
|
|
13,871
|
|
|
13,358
|
|
|
513
|
|
|
4
|
%
|
|
363
|
|
|
150
|
|
|||||
General and administrative expenses
|
|
3,942
|
|
|
3,535
|
|
|
407
|
|
|
12
|
%
|
|
n/a
|
|
|
n/a
|
|
|||||
Depreciation and amortization
|
|
83,040
|
|
|
78,006
|
|
|
5,034
|
|
|
6
|
%
|
|
4,579
|
|
|
455
|
|
|||||
Interest expense
|
|
85,350
|
|
|
13,327
|
|
|
72,023
|
|
|
540
|
%
|
|
n/a
|
|
|
n/a
|
|
|||||
Impairment charges on real estate
|
|
8,706
|
|
|
—
|
|
|
8,706
|
|
|
100
|
%
|
|
—
|
|
|
8,706
|
|
|||||
Other income
|
|
22
|
|
|
1,876
|
|
|
(1,854
|
)
|
|
(99
|
)%
|
|
—
|
|
|
(1,854
|
)
|
|||||
Other interest income
|
|
264
|
|
|
96
|
|
|
168
|
|
|
175
|
%
|
|
n/a
|
|
|
n/a
|
|
|||||
Loss from extinguishment of debt
|
|
(196
|
)
|
|
—
|
|
|
(196
|
)
|
|
(100
|
)%
|
|
—
|
|
|
(196
|
)
|
|||||
Equity in income (loss) of unconsolidated joint venture
|
|
—
|
|
|
(348
|
)
|
|
348
|
|
|
(100
|
)%
|
|
348
|
|
|
—
|
|
|||||
Gain on sale of real estate, net
|
|
—
|
|
|
11,942
|
|
|
(11,942
|
)
|
|
(100
|
)%
|
|
(11,942
|
)
|
|
—
|
|
•
|
Adjustments for straight-line rent.
These are adjustments to rental revenue as required by GAAP to recognize contractual lease payments on a straight-line basis over the life of the respective lease. We have excluded these adjustments in our calculation of MFFO to more appropriately reflect the current economic impact of our in-place leases, while also providing investors with a useful supplemental metric that addresses core operating performance by removing rent we expect to receive in a future period or rent that was received in a prior period;
|
•
|
Amortization of above- and below-market leases.
Similar to depreciation and amortization of real estate assets and lease related costs that are excluded from FFO, GAAP implicitly assumes that the value of intangible lease assets and liabilities diminishes predictably over time and requires that these charges be recognized currently in revenue. Since market lease rates in the aggregate have historically risen or fallen with local market conditions, management believes that by excluding these charges, MFFO provides useful supplemental information on the realized economics of the real estate;
|
•
|
Unrealized (gains) losses on derivative instruments.
These adjustments include unrealized (gains) losses from mark-to-market adjustments on interest rate swaps. The change in fair value of interest rate swaps not designated as a hedge are non-cash adjustments recognized directly in earnings and are included in interest expense. We have excluded these adjustments in our calculation of MFFO to more appropriately reflect the economic impact of our interest rate swap agreements;
|
•
|
Adjustments relating to contingent purchase price obligations.
These are adjustments relating to contingent purchase price obligations where such adjustments have been included in the derivation of GAAP net income. We believe that the elimination of the contingent purchase price consideration adjustment, included in other income for GAAP purposes, is appropriate because the adjustment is a non-cash adjustment that is not reflective of our ongoing operating performance; and
|
•
|
Loss from extinguishment of debt
. A loss from extinguishment of debt, which includes prepayment fees related to the extinguishment of debt, represents the difference between the carrying value of any consideration transferred to the lender in return for the extinguishment of a debt and the net carrying value of the debt at the time of settlement. We have excluded the loss from extinguishment of debt in our calculation of MFFO because these losses do not impact the current operating performance of our investments and do not provide an indication of future operating performance.
|
|
|
For the Three Months Ended June 30,
|
|
For the Six Months Ended June 30,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
Net (loss) income attributable to common stockholders
|
|
$
|
(28,115
|
)
|
|
$
|
17,749
|
|
|
$
|
(54,793
|
)
|
|
$
|
34,379
|
|
Depreciation of real estate assets
|
|
26,109
|
|
|
23,448
|
|
|
52,605
|
|
|
46,603
|
|
||||
Amortization of lease-related costs
|
|
15,523
|
|
|
15,577
|
|
|
30,435
|
|
|
31,403
|
|
||||
Impairment charges on real estate
|
|
—
|
|
|
—
|
|
|
8,706
|
|
|
—
|
|
||||
Gain on sale of real estate, net
|
|
—
|
|
|
(11,942
|
)
|
|
—
|
|
|
(11,942
|
)
|
||||
FFO attributable to common stockholders
(1)
|
|
13,517
|
|
|
44,832
|
|
|
36,953
|
|
|
100,443
|
|
||||
Straight-line rent and amortization of above- and below-market leases, net
|
|
(2,304
|
)
|
|
(2,539
|
)
|
|
(5,126
|
)
|
|
(7,534
|
)
|
||||
Loss from extinguishment of debt
|
|
196
|
|
|
—
|
|
|
196
|
|
|
—
|
|
||||
Unrealized losses (gains) on derivative instruments
|
|
23,280
|
|
|
(7,289
|
)
|
|
37,899
|
|
|
(25,326
|
)
|
||||
Adjustment relating to contingent purchase price obligation
|
|
—
|
|
|
(1,575
|
)
|
|
—
|
|
|
(1,575
|
)
|
||||
MFFO attributable to common stockholders
(1)
|
|
$
|
34,689
|
|
|
$
|
33,429
|
|
|
$
|
69,922
|
|
|
$
|
66,008
|
|
|
For the Three Months Ended June 30,
|
|
For the Six Months Ended June 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
MFFO by component:
|
|
|
|
|
|
|
|
||||||||
Assets held for investment
|
$
|
22,996
|
|
|
$
|
21,591
|
|
|
$
|
43,733
|
|
|
$
|
41,951
|
|
Real estate properties sold
|
—
|
|
|
379
|
|
|
—
|
|
|
872
|
|
||||
Real estate properties under contract for sale
|
11,693
|
|
|
11,459
|
|
|
26,189
|
|
|
23,185
|
|
||||
MFFO
|
$
|
34,689
|
|
|
$
|
33,429
|
|
|
$
|
69,922
|
|
|
$
|
66,008
|
|
|
|
Distributions Declared
|
|
Distributions Declared
Per Share
(1)
|
|
Distributions Paid
(2)
|
|
Cash Flow from
Operating Activities
|
||||||||||||||||
Period
|
|
|
|
Cash
|
|
Reinvested
|
|
Total
|
|
|||||||||||||||
First Quarter 2019
|
|
$
|
28,523
|
|
|
$
|
0.1625
|
|
|
$
|
15,390
|
|
|
$
|
13,497
|
|
|
$
|
28,887
|
|
|
$
|
15,008
|
|
Second Quarter 2019
|
|
28,404
|
|
|
0.1625
|
|
|
15,382
|
|
|
12,974
|
|
|
28,356
|
|
|
29,918
|
|
||||||
|
|
$
|
56,927
|
|
|
$
|
0.3250
|
|
|
$
|
30,772
|
|
|
$
|
26,471
|
|
|
$
|
57,243
|
|
|
$
|
44,926
|
|
(1)
|
Assumes share was issued and outstanding each day that was a record date for distributions during the period presented.
|
(2)
|
Distributions are paid on a monthly basis. Distributions for all record dates of a given month are paid on or about the first business day of the following month.
|
•
|
whether the lease stipulates how a tenant improvement allowance may be spent;
|
•
|
whether the lessee or lessor supervises the construction and bears the risk of cost overruns;
|
•
|
whether the amount of a tenant improvement allowance is in excess of market rates;
|
•
|
whether the tenant or landlord retains legal title to the improvements at the end of the lease term;
|
•
|
whether the tenant improvements are unique to the tenant or general purpose in nature; and
|
•
|
whether the tenant improvements are expected to have any residual value at the end of the lease.
|
(i)
|
Class A office building;
|
(ii)
|
Purchase price of at least $125.0 million;
|
(iii)
|
Average occupancy of at least 90% for the first two years based on contractual in-place leases; and
|
(iv)
|
Stabilized property investment yield that is generally supportive of the distributions per unit of the Purchaser.
|
a)
|
During the period covered by this Form 10-Q, we did not sell any equity securities that were not registered under the Securities Act of 1933.
|
b)
|
Not applicable.
|
c)
|
We have a share redemption program that may enable stockholders to sell their shares to us in limited circumstances. The restrictions of our share redemption program will severely limit our stockholders’ ability to sell their shares should they require liquidity and will limit our stockholders’ ability to recover an amount equal to our estimated value per share. The following is a description of our share redemption program.
|
•
|
Unless the shares are being redeemed in connection with a stockholder’s death, “Qualifying Disability” or “Determination of Incompetence” (each as defined in the share redemption program, and together with redemptions sought in connection with a stockholder’s death, “Special Redemptions;” all redemptions that do not meet the requirements for a Special Redemption are “Ordinary Redemptions”), we may not redeem shares unless the stockholder has held the shares for one year.
|
•
|
During any calendar year, we may redeem only the number of shares that we could purchase with the amount of net proceeds from the sale of shares under our dividend reinvestment plan during the prior calendar year, provided that once we have received requests for redemptions, whether in connection with Special Redemptions or otherwise, that if honored, and when combined with all prior redemptions made during the calendar year, would result in the amount of remaining funds available for the redemption of additional shares in such calendar year being $10.0 million or less, the last $10.0 million of available funds shall be reserved exclusively for Special Redemptions. Notwithstanding anything contained in our share redemption program to the contrary, we may increase or decrease the funding available for the redemption of shares pursuant to the program upon ten business days’ notice to our stockholders.
|
•
|
During any calendar year, we may redeem no more than 5% of the weighted-average number of shares outstanding during the prior calendar year.
|
•
|
We have no obligation to redeem shares if the redemption would violate the restrictions on distributions under Maryland General Corporation Law, as amended from time to time, which prohibits distributions that would cause a corporation to fail to meet statutory tests of solvency.
|
Month
|
|
Total Number
of Shares Redeemed
(1)
|
|
Average Price Paid
Per Share
(2)
|
|
Approximate Dollar Value of Shares Available That May Yet Be Redeemed Under the Program
|
|||
January 2019
|
|
3,863,019
|
|
|
$
|
11.43
|
|
|
(3)
|
February 2019
|
|
204,861
|
|
|
$
|
11.59
|
|
|
(3)
|
March 2019
|
|
89,190
|
|
|
$
|
12.02
|
|
|
(3)
|
April 2019
|
|
72,512
|
|
|
$
|
12.02
|
|
|
(3)
|
May 2019
|
|
67,724
|
|
|
$
|
12.02
|
|
|
(3)
|
June 2019
|
|
100,579
|
|
|
$
|
12.02
|
|
|
(3)
|
Total
|
|
4,397,885
|
|
|
|
|
|
Ex.
|
|
Description
|
|
|
|
3.1
|
|
|
|
|
|
3.2
|
|
|
|
|
|
4.1
|
|
|
|
|
|
4.2
|
|
|
|
|
|
10.1
|
|
|
|
|
|
10.2
|
|
|
|
|
|
10.3
|
|
|
|
|
|
10.4
|
|
|
|
|
|
10.5
|
|
|
|
|
|
10.6
|
|
|
|
|
|
10.7
|
|
|
|
|
|
10.8
|
|
|
|
|
|
10.9
|
|
|
|
|
|
10.10
|
|
|
|
|
|
10.11
|
|
|
|
|
|
10.12
|
|
Ex.
|
|
Description
|
|
|
|
31.1
|
|
|
|
|
|
31.2
|
|
|
|
|
|
32.1
|
|
|
|
|
|
32.2
|
|
|
|
|
|
99.1
|
|
|
|
|
|
101.INS
|
|
XBRL Instance Document
|
|
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema
|
|
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase
|
|
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase
|
|
|
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase
|
|
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase
|
|
|
|
|
|
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.
|
|
|
|
|
|
Date:
|
August 9, 2019
|
By:
|
/S/
C
HARLES
J. S
CHREIBER
, J
R.
|
|
|
|
Charles J. Schreiber, Jr.
|
|
|
|
Chairman of the Board,
Chief Executive Officer and Director
|
|
|
|
(principal executive officer)
|
|
|
|
|
Date:
|
August 9, 2019
|
By:
|
/S/
J
EFFREY
K. W
ALDVOGEL
|
|
|
|
Jeffrey K. Waldvogel
|
|
|
|
Chief Financial Officer, Treasurer and Secretary
|
|
|
|
(principal financial officer)
|
ACTIVE 31157768v21
|
|
|
ACTIVE 31157768v21
|
|
|
15.
|
MISCELLANEOUS PROVISIONS
|
29
|
|
||
|
|
|
|
||
|
15.1
|
Notices
|
29
|
|
|
|
15.2
|
Assignment; Binding on Successors and Assigns
|
29
|
|
|
|
15.3
|
Work Product
|
29
|
|
|
|
15.4
|
Further Product
|
30
|
|
|
|
15.5
|
Attorneys' Fees
|
30
|
|
|
|
15.6
|
Survival of Representations, Warranties, Covenants, Obligations and Agreements
|
30
|
|
|
|
15.7
|
Entire Agreement
|
31
|
|
|
|
15.8
|
Governing Law
|
32
|
|
|
|
15.9
|
Counterparts
|
32
|
|
|
|
15.10
|
Headings; Construction
|
32
|
|
|
|
15.11
|
Time of Essence
|
32
|
|
|
|
15.12
|
Partial Validity; Severability
|
32
|
|
|
|
15.13
|
No Third Party Beneficiaries
|
32
|
|
|
|
15.14
|
Several Liability and Obligation of Buyer
|
33
|
|
|
|
15.15
|
Joint Product of Parties
|
33
|
|
|
|
15.16
|
Calculation of Time Periods
|
33
|
|
|
|
15.17
|
Procedure for Indemnity
|
33
|
|
|
|
15.18
|
Waiver of Jury Trial
|
33
|
|
|
|
15.19
|
No Personal Liability
|
33
|
|
|
|
15.20
|
Several Liability of Seller
|
34
|
|
|
|
15.21
|
State-Specific Provisions
|
34
|
|
|
|
15.22
|
Exhibits
|
40
|
|
|
|
15.23
|
Termination Rights
|
40
|
|
ACTIVE 31157768v21
|
|
|
1.
|
Exhibit E: a list of state-specific documents that must be sent by owners of certain real estate properties to state authorities
|
2.
|
Exhibit H: a form of notice to each tenant regarding the sale of the applicable real estate property
|
3.
|
Schedule 1: the preliminary title reports or title commitments covering each real estate property
|
4.
|
Schedule 5: the addresses of the parties for notices to be sent under the Agreement
|
ACTIVE 31157768v21
|
|
|
1.
|
BASIC TERMS AND DEFINITIONS; REFERENCES
|
ACTIVE 31157768v21
|
‑
1
‑
|
|
2.
|
PURCHASE AND SALE
|
ACTIVE 31157768v21
|
‑
2
‑
|
|
3.
|
PURCHASE PRICE
|
(a)
|
Village Center Station II (Charter Communications)
: One hundred Forty-Four Million Six Hundred Thousand Dollars ($144,600,000);
|
(b)
|
Tower At Lake Carolyn (Tower 909)
: Seventy-Six Million Three Hundred Thousand Dollars ($76,300,000);
|
(c)
|
One Washingtonian
: One Hundred Two Million One Hundred Thousand Dollars ($102,100,000);
|
(d)
|
222 Main
: Two Hundred Eleven Million Three Hundred Thousand Dollars ($211,300,000);
|
(e)
|
171 17th Street
: One Hundred Seventy-Six Million Five Hundred Thousand Dollars ($176,500,000);
|
(f)
|
Reston Square
: Fifty-One Million Dollars ($51,000,000);
|
(g)
|
101 South Hanley
: Seventy-Nine Million Seven Hundred Thousand Dollars ($79,700,000);
|
(h)
|
Village Center Station
: Eighty-Nine Million One Hundred Thousand Dollars ($89,200,000);
|
(i)
|
Promenade I & II At Eilan
: Seventy-Two Million Eight Hundred Thousand Dollars ($72,800,000);
|
(j)
|
CrossPoint
: Ninety-Seven Million Seven Hundred Thousand Dollars ($97,700,000); and
|
(k)
|
Towers At Emeryville (Tower I)
: One Hundred Twenty One Million One Hundred Thousand Dollars ($121,100,000).
|
ACTIVE 31157768v21
|
‑
3
‑
|
|
4.
|
PROPERTY INFORMATION; TITLE POLICIES; INSPECTIONS; CONFIDENTIALITY
|
ACTIVE 31157768v21
|
‑
4
‑
|
|
ACTIVE 31157768v21
|
‑
5
‑
|
|
ACTIVE 31157768v21
|
‑
6
‑
|
|
ACTIVE 31157768v21
|
‑
7
‑
|
|
5.
|
OPERATIONS AND RISK OF LOSS
|
ACTIVE 31157768v21
|
‑
8
‑
|
|
ACTIVE 31157768v21
|
‑
9
‑
|
|
6.
|
SELLER’S AND BUYER’S DELIVERIES
|
ACTIVE 31157768v21
|
‑
10
‑
|
|
7.
|
CONDITIONS TO BUYER’S AND SELLER’S OBLIGATIONS
|
ACTIVE 31157768v21
|
‑
11
‑
|
|
ACTIVE 31157768v21
|
‑
12
‑
|
|
ACTIVE 31157768v21
|
‑
13
‑
|
|
8.
|
CLOSE OF ESCROW; POSSESSION
|
9.
|
ESCROW
|
ACTIVE 31157768v21
|
‑
14
‑
|
|
ACTIVE 31157768v21
|
‑
15
‑
|
|
10.
|
PRORATIONS
|
ACTIVE 31157768v21
|
‑
16
‑
|
|
ACTIVE 31157768v21
|
‑
17
‑
|
|
ACTIVE 31157768v21
|
‑
18
‑
|
|
ACTIVE 31157768v21
|
‑
19
‑
|
|
11.
|
SELLER’S REPRESENTATIONS AND WARRANTIES; AS‑IS
|
ACTIVE 31157768v21
|
‑
20
‑
|
|
ACTIVE 31157768v21
|
‑
21
‑
|
|
ACTIVE 31157768v21
|
‑
22
‑
|
|
ACTIVE 31157768v21
|
‑
23
‑
|
|
1.
|
THE CONTENT OR ACCURACY OF ANY REPORT, STUDY, OPINION OR CONCLUSION OF ANY SOILS, TOXIC, ENVIRONMENTAL OR OTHER ENGINEER OR OTHER PERSON OR ENTITY WHO HAS EXAMINED THE PORTFOLIO OR ANY ASPECT THEREOF;
|
2.
|
THE CONTENT OR ACCURACY OF ANY OF THE ITEMS (INCLUDING, WITHOUT LIMITATION, THE PROPERTY INFORMATION) DELIVERED TO BUYER PURSUANT TO BUYER’S REVIEW OF THE CONDITION OF THE PORTFOLIO;
|
3.
|
THE CONTENT OR ACCURACY OF ANY PROJECTION, FINANCIAL OR MARKETING ANALYSIS OR OTHER INFORMATION GIVEN TO BUYER BY SELLER OR REVIEWED BY BUYER WITH RESPECT TO THE PORTFOLIO.
|
12.
|
BUYER’S COVENANTS, REPRESENTATIONS AND WARRANTIES; RELEASE; ERISA; INDEMNIFICATION
|
ACTIVE 31157768v21
|
‑
24
‑
|
|
ACTIVE 31157768v21
|
‑
25
‑
|
|
ACTIVE 31157768v21
|
‑
26
‑
|
|
13.
|
DEFAULT AND DAMAGES
|
ACTIVE 31157768v21
|
‑
27
‑
|
|
ACTIVE 31157768v21
|
‑
28
‑
|
|
14.
|
NO BROKER
|
15.
|
MISCELLANEOUS PROVISIONS
|
ACTIVE 31157768v21
|
‑
29
‑
|
|
ACTIVE 31157768v21
|
‑
30
‑
|
|
ACTIVE 31157768v21
|
‑
31
‑
|
|
ACTIVE 31157768v21
|
‑
32
‑
|
|
ACTIVE 31157768v21
|
‑
33
‑
|
|
ACTIVE 31157768v21
|
‑
34
‑
|
|
ACTIVE 31157768v21
|
‑
35
‑
|
|
ACTIVE 31157768v21
|
‑
36
‑
|
|
ACTIVE 31157768v21
|
‑
37
‑
|
|
(a)
|
Bulk Sales/Taxes
. All Pennsylvania state tax returns required to have been filed by such Seller have been filed or will be filed by the Closing Date, and all Pennsylvania state taxes for the Property located in Pennsylvania shown as due on such returns, including without limitation, income taxes, sales and use taxes, unemployment compensation contributions and employer withholding taxes, if any, payable by such Seller, and interest and penalties thereon accrued on or before the Closing Date, have been paid, or will be paid by the Closing Date.
|
ACTIVE 31157768v21
|
‑
38
‑
|
|
(b)
|
Sewage Facilities Notice
. Under the terms of the Pennsylvania Sewage Facilities Act of January 24, 1966, No. 537, P.L. 1535 as amended, the Seller of the Property located in Pennsylvania represents that a community sewage system currently exists and is available to the Property located in Pennsylvania.
|
ACTIVE 31157768v21
|
‑
39
‑
|
|
ACTIVE 31157768v21
|
‑
40
‑
|
|
By:
|
KBSIII VILLAGE CENTER STATION II MEMBER, LLC,
|
By:
|
KBSIII REIT ACQUISITION XXXII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION VI, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION X, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION XIII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION XV, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION XVIII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION XX, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION XXIII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII PROMENADE ONE MEZZ, LLC,
|
By:
|
KBSIII PROMENAGE AT EILAN, LLC,
|
By:
|
KBSIII 3003 WASHINGTON MEMBER, LLC,
|
By:
|
KBSIII REIT ACQUISITION XVII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII PROMENADE TWO MEZZ, LLC,
|
By:
|
KBSIII PROMENADE AT EILAN, LLC,
|
By:
|
KBSIII 3003 WASHINGTON MEMBER, LLC,
|
By:
|
KBSIII REIT ACQUISITION XVII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII CROSSPOINT AT VALLEY FORGE, LLC,
|
By:
|
KBSIII REIT ACQUISITION XXVI, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION XXI, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-ACQUISITION I, LLC
|
By:
|
PRIME US PROPERTIES, LLC,
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
EXHIBIT A
|
—
|
List of Seller Parties, Buyer Parties and Real Properties
|
EXHIBIT B
|
—
|
Form of Closing Escrow Agreement
|
EXHIBIT C
|
—
|
List of Contracts
|
EXHIBIT D
|
—
|
Intentionally Deleted
|
EXHIBIT E
|
—
|
State-Specific Deliverables
|
EXHIBIT F
|
—
|
Form of Assignment of Leases and Contracts and Bill of Sale
|
EXHIBIT G
|
—
|
Form of FIRPTA Affidavit
|
EXHIBIT H
|
—
|
Form of Tenant Notice
|
EXHIBIT I
|
—
|
Form of Owners Affidavit
|
SCHEDULE 1
|
—
|
List of Title Reports
|
SCHEDULE 2
|
—
|
Disclosures
|
SCHEDULE 3
|
—
|
Form of California Natural Hazard Disclosure Statement
|
SCHEDULE 4
|
—
|
Schedule of Asset Managers
|
SCHEDULE 5
|
—
|
Notice Address of the Parties
|
SCHEDULE 6
|
—
|
Owner Deposits
|
SCHEDULE 7
|
—
|
Intangible Property
|
ACTIVE 31157768v21
|
|
|
|
SELLER PARTY
|
REAL PROPERTY NAME AND ADDRESS
|
BUYER PARTY
|
1.
|
Village Center Station II Owner, LLC, a Delaware limited liability company
|
Village Center Station II (Charter Communications)
6350 and 6360 South Fiddlers Green Circle
Greenwood Village, CO 80111
|
Prime US-Village Center Station II, LLC, a Delaware limited liability company
|
2.
|
KBSIII Tower at Lake Carolyn, LLC, a Delaware limited liability company
|
Tower At Lake Carolyn (Tower 909)
909 E. Lake Carolyn Parkway,
Irving, TX 75039
|
Prime US-Tower At Lake Carolyn, LLC, a Delaware limited liability company
|
3.
|
KBSIII One Washingtonian, LLC, a Delaware limited liability company
|
One Washingtonian
9801 Washingtonian Boulevard
Gaithersburg, MD 20878
|
Prime US-One Washingtonian, LLC, a Delaware limited liability company
|
4.
|
KBSIII 222 Main, LLC, a Delaware limited liability company
|
222 Main
222 South Main Street,
Salt Lake City, UT 84101
|
Prime US-222 Main, LLC, a Delaware limited liability company
|
5.
|
KBSIII 171 17th Street, LLC, a Delaware limited liability company
|
171 17th Street
171 17th Street NW
Atlanta, GA 30363
|
Prime US-171 17th Street, LLC, a Delaware limited liability company
|
6.
|
KBSIII Reston Square, LLC, a Delaware limited liability company
|
Reston Square
11790 Sunrise Valley Drive
Reston, VA 20191
|
Prime US-Reston Square, LLC, a Delaware limited liability company
|
7.
|
KBSIII 101 South Hanley, LLC, a Delaware limited liability company
|
101 South Hanley
101 South Hanley
Clayton, MO 63105
|
Prime US-101 South Hanley, LLC, a Delaware limited liability company
|
8.
|
KBSIII Village Center Station, LLC, a Delaware limited liability company
|
Village Center Station
6380 South Fiddlers Green Circle
Greenwood Village, CO 80111
|
Prime US-Village Center Station, LLC, a Delaware limited liability company
|
|
EXHIBIT A
|
|
ACTIVE 31157768v21
|
|
|
9.
|
Promenade One
KBSIII Promenade One, LLC, a Delaware limited liability company
Promenade Two
KBSIII Promenade Two, LLC, a Delaware limited liability company
|
Promenade I & II At Eilan
Promenade One
17806 IH-10 W
San Antonio, Texas 78257
Promenade Two
17802 IH-10 W
San Antonio, Texas 78257
|
Prime US-Promenade, LLC, a Delaware limited liability company
|
10.
|
KBSIII CrossPoint At Valley Forge Trust, a Delaware Statutory Trust
|
Crosspoint
550 East Swedesford Road
Wayne, PA 19087
|
Prime US-CrossPoint At Valley Forge, LLC, a Delaware limited liability company
|
11.
|
KBSIII Towers At Emeryville, LLC, a Delaware limited liability company
|
Towers At Emeryville – Tower I
1900 Powell Street
Emeryville, CA 94608
|
Prime US-Tower At Emeryville, LLC, a Delaware limited liability company
|
|
EXHIBIT A
|
|
ACTIVE 31157768v21
|
|
|
|
EXHIBIT B
|
|
ACTIVE 31157768v21
|
Page
1
|
|
|
EXHIBIT B
|
|
ACTIVE 31157768v21
|
Page
2
|
|
|
EXHIBIT B
|
|
ACTIVE 31157768v21
|
Page
3
|
|
|
EXHIBIT B
|
|
ACTIVE 31157768v21
|
Page
4
|
|
|
EXHIBIT B
|
|
ACTIVE 31157768v21
|
Page
5
|
|
|
EXHIBIT B
|
|
ACTIVE 31157768v21
|
Page
6
|
|
|
EXHIBIT B
|
|
ACTIVE 31157768v21
|
Page
7
|
|
c/o KBS Capital Advisors, LLC
800 Newport Center Drive, Suite 700
Newport Beach, CA 92660
Attn: __________________
Phone: (___) _____________
Electronic mail: ___________________
|
with a copy to: _____________
|
|
|
c/o KBS US Prime Property Management Pte. Ltd.
_______________________________________
_______________________________________
Attn: _________________
Phone: (___) _________________
Electronic mail: __________________
|
with a copy to:
______________________
______________________
|
|
|
Commonwealth Land Title Insurance Company
4100 Newport Place Drive, Suite 120
Newport Beach, California 92660
Attention: Joy Eaton Phone: (949) 724-3145 Electronic mail: joyeaton@ltic.com |
|
|
EXHIBIT B
|
|
ACTIVE 31157768v21
|
Page
8
|
|
|
EXHIBIT B
|
|
ACTIVE 31157768v21
|
Page
9
|
|
|
EXHIBIT B
|
|
ACTIVE 31157768v21
|
Page
10
|
|
|
EXHIBIT B
|
|
ACTIVE 31157768v21
|
Page
11
|
|
|
EXHIBIT B
|
|
ACTIVE 31157768v21
|
Page
12
|
|
|
EXHIBIT D
Page 1
|
|
ACTIVE 31157768v21
|
Page 1
|
|
|
EXHIBIT F
|
|
ACTIVE 31157768v21
|
Page
1
|
|
|
EXHIBIT F
|
|
ACTIVE 31157768v21
|
Page
2
|
|
|
EXHIBIT F
|
|
ACTIVE 31157768v21
|
Page
3
|
|
|
EXHIBIT F
|
|
ACTIVE 31157768v21
|
Page
4
|
|
|
EXHIBIT F
|
|
ACTIVE 31157768v21
|
Page
5
|
|
SMRH:483356584.8
|
EXHIBIT G
|
|
ACTIVE 31157768v21
|
Page
1
|
|
SMRH:483356584.8
|
EXHIBIT G
|
|
ACTIVE 31157768v21
|
Page
2
|
|
SMRH:483356584.8
|
EXHIBIT G
|
|
ACTIVE 31157768v21
|
Page
3
|
|
1.
|
Seller is a limited liability company organized and validly existing under the laws of the State of ________________________.
|
2.
|
To Seller’s actual knowledge, (i) Seller’s operating agreement is in full force and effect, and (ii) no proceedings are pending for the dissolution of the Seller.
|
3.
|
To Seller’s actual knowledge, the leases described on
Exhibit “B”
attached hereto constitute all of the written leases affecting the Real Property with the current tenants of the Real Property.
|
4.
|
To Seller’s actual knowledge, except as disclosed in
Exhibit ”C”
attached hereto and made a part hereof, (a) there is no capital improvement work currently being constructed (or that was constructed during the last 3 months) on the Real Property that is the subject of a written contract with Seller which could give rise to a mechanic’s or materialman’s lien on the Real Property, and (b) Seller has not entered into any contracts for the furnishing of labor, materials, or services for construction purposes with respect to the Real Property to be furnished subsequent to the date of this affidavit.
|
5.
|
Seller shall not hereafter cause any encumbrances or other instruments to be recorded against the Property (other than the recording of a deed (the “Deed”) transferring fee title to the Real Property to ___________) through the date the Deed is recorded in _________ County, __________.
|
SMRH:483356584.8
|
EXHIBIT I
|
|
ACTIVE 31157768v21
|
Page
1
|
|
SMRH:483356584.8
|
EXHIBIT I
|
|
ACTIVE 31157768v21
|
Page
2
|
|
SMRH:483356584.8
|
EXHIBIT I
|
|
ACTIVE 31157768v21
|
Page
3
|
|
|
Schedule 2
|
|
ACTIVE 31157768v21
|
Page
1
|
|
NO.
|
SELLER NAME
|
ASSET MANAGER
|
1.
|
Village Center Station II Owner, LLC,
a Delaware limited liability company
|
Clint Copulos
|
2.
|
KBSIII Tower at Lake Carolyn, LLC,
a Delaware limited liability company
|
Brett Merz
|
3.
|
KBSIII One Washingtonian, LLC,
a Delaware limited liability company
|
Stephen Close
|
4.
|
KBSIII 222 Main, LLC,
a Delaware limited liability company
|
Tim Helgeson
|
5.
|
KBSIII 171 17th Street, LLC,
a Delaware limited liability company
|
Allen Aldridge
|
6.
|
KBSIII Reston Square, LLC, a Delaware limited liability company
|
Stephen Close
|
7.
|
KBSIII 101 South Hanley, LLC,
a Delaware limited liability company
|
Dan Park
|
8.
|
KBSIII Village Center Station, LLC,
a Delaware limited liability company
|
Clint Copulos
|
9.
|
Promenade One
KBSIII Promenade One, LLC,
a Delaware limited liability company
Promenade Two
KBSIII Promenade Two, LLC,
a Delaware limited liability company
|
Gio Cordoves
Gio Cordoves
|
10.
|
KBSIII CrossPoint At Valley Forge Trust,
a Delaware Statutory Trust
|
Shannon Hill
|
11.
|
KBSIII Towers At Emeryville, LLC,
a Delaware limited liability company
|
Brent Carroll
|
|
Schedule 4
|
|
ACTIVE 31157768v21
|
Page
1
|
|
By:
|
KBSIII VILLAGE CENTER STATION II MEMBER, LLC,
|
By:
|
KBSIII REIT ACQUISITION XXXII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION VI, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION X, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION XIII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION XV, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION XVIII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION XX, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION XXIII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII PROMENADE ONE MEZZ, LLC,
|
By:
|
KBSIII PROMENAGE AT EILAN, LLC,
|
By:
|
KBSIII 3003 WASHINGTON MEMBER, LLC,
|
By:
|
KBSIII REIT ACQUISITION XVII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII PROMENADE TWO MEZZ, LLC,
|
By:
|
KBSIII PROMENAGE AT EILAN, LLC,
|
By:
|
KBSIII 3003 WASHINGTON MEMBER, LLC,
|
By:
|
KBSIII REIT ACQUISITION XVII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII CROSSPOINT AT VALLEY FORGE, LLC,
|
By:
|
KBSIII REIT ACQUISITION XXVI, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION XXI, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-ACQUISITION I, LLC
|
By:
|
PRIME US PROPERTIES, LLC,
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
Contents
|
Page
|
|
|
1.
|
Definitions and Interpretation
|
1
|
|
2.
|
Investment
|
4
|
|
3.
|
Conditions
|
5
|
|
4.
|
Payment
|
5
|
|
5.
|
Delivery
|
6
|
|
6.
|
Investor's Representations, Warranties, Acknowledgments and
Undertakings
|
6
|
|
7.
|
The Manager's Representations and Warranties
|
11
|
|
8.
|
Disclosures
|
12
|
|
9.
|
US Securities Act Exemption
|
13
|
|
10.
|
General
|
15
|
|
(1)
|
KBS US PRIME PROPERTY MANAGEMENT PTE. LTD.
, a company established and validly existing under the laws of Singapore and having its principal place of business at 1 Raffles Place, #40-01 One Raffles Place, Singapore 048616, in its capacity as the manager (the “
Manager
”) of Prime US REIT; and
|
(2)
|
KBS REIT Properties III LLC
, a company organised and validly existing under the laws of the State of Delaware and having its principal place of business at 800 Newport Center Drive, Suite 700, Newport Beach, California 92660 (the “
Investor
”).
|
(A)
|
The Manager is proposing to offer for subscription units in Prime US REIT (“
Units
”) by way of (i) an international placement to investors, including institutional and other investors in Singapore (the “
Placement
") and (ii) an offering to the public in Singapore (the “
Public Offer
” and together with the Placement, the “
IPO
”), subject to an over-allotment option in connection with the IPO. In connection with the IPO, the Manager is expected to enter into a placement agreement in relation to the Placement and a Singapore offer agreement in relation to the Public Offer (the “
Singapore Offer Agreement
” and collectively, the “
Underwriting Agreements
”) with DBS Bank Ltd., Merrill Lynch (Singapore) Pte. Ltd., China International Capital Corporation (Singapore) Pte. Limited, Credit Suisse (Singapore) Limited, Maybank Kim Eng Securities Pte. Ltd., and Oversea-Chinese Banking Corporation Limited (collectively, the “
Underwriters
”) pursuant to which, the Underwriters will, severally but not jointly, agree to procure the subscription and payment for, or failing which, will subscribe and pay for, the Units offered under the IPO (“
IPO Units
”), subject to and on the terms of the Underwriting Agreements.
|
(B)
|
Separate from but concurrently with the IPO, the Manager has agreed to issue, and the Investor has agreed to subscribe and pay for, 228,408,999 Units (the “
Subscription Units
”) for a total consideration of US$200,999,919 (the “
Subscription Amount
”) on the terms and subject to the conditions set out in this Agreement.
|
(C)
|
The Manager and the Investor wish to record the arrangements agreed between them for the subscription and payment of the Subscription Units.
|
1.
|
Definitions and Interpretation
|
1.1
|
In this Agreement, except to the extent that the context requires otherwise:
|
(i)
|
in relation to any director, chief executive officer, or controlling shareholder of the Manager, or controlling unitholder of Prime US REIT (being an individual), means:
|
(a)
|
his immediate family (
i.e.
his spouse, child, adopted child, step-child, sibling or parent);
|
(b)
|
the trustees of any trust of which he or his immediate family is a beneficiary or, in the case of discretionary trust, is a discretionary object; and
|
(c)
|
any company in which he and his immediate family together (directly or indirectly) have an interest of 30.0% or more; and
|
(ii)
|
in relation to the controlling shareholder of the Manager, or the Manager, the Trustee or controlling unitholder of Prime US REIT (being a company) means any other company which is its subsidiary or holding company, or is a subsidiary of such holding company, or one in the equity of which it and/or such other company or companies taken together (directly or indirectly) have an interest of 30.0% or more;
|
(i)
|
holds directly or indirectly 15% or more of the total number of issued shares excluding treasury shares in the Manager, unless determined otherwise by the SGX-ST
; or
|
(ii)
|
in fact exercises control over the Manager;
|
(i)
|
holds directly or indirectly 15% or more of the nominal amount of all voting units in Prime US REIT, unless determined otherwise by MAS
; or
|
(ii)
|
in fact exercises control over Prime US REIT;
|
1.2
|
Headings, Clauses etc.
|
2.
|
Investment
|
2.1
|
The Manager hereby agrees to issue, on the IPO Settlement Date, and the Investor, relying on the Manager’s representations, warranties and undertakings set out in Clause 7, hereby agrees to subscribe and pay for all, and not some only, of the Subscription Units at a price per Subscription Unit equal to the IPO Price, on the terms and subject to the conditions of this Agreement. The Manager will notify the Investor of the IPO Price as soon as reasonably practicable upon its determination. For the avoidance of doubt, the Manager and the Underwriters shall have absolute discretion to change or adjust (i) the number of IPO Units, and (ii) the allocation of IPO Units between the Placement and the Public Offer.
|
2.2
|
It is a condition of this Agreement that the Investor shall pay the aggregate IPO Price for the Subscription Units in full in accordance with Clause 4.1, failing which the Investor shall be deemed to have committed a material breach of this Agreement.
|
2.3
|
The total consideration payable by the Investor for the Subscription Units will be an amount in US dollars calculated by multiplying the number of Subscription Units by the IPO Price.
|
2.4
|
The Investor agrees to provide, immediately at the request of the Manager and/or the Underwriters, evidence satisfactory to the Manager and the Underwriters that the Investor has sufficient funds for the purpose of meeting its obligation described in Clause 4.1.
|
2.5
|
The Subscription Units will, when delivered, be fully paid and free from all options, liens, charges, mortgages, pledges, claims, equities, encumbrances and other third party rights and shall rank
pari passu
with the other Units then in issue and to be listed on the SGX- ST.
|
2.6
|
The Investor agrees that the Underwriters shall have the unconditional right under the Contracts (Rights of Third Parties) Act to enforce the provisions of and rely on this Clause 2.
|
3.
|
Conditions
|
(i)
|
the receipt of the eligibility-to-list letter from the SGX-ST approving, among others, the listing of, and quotation for, the Units (including among others, the IPO Units and the Subscription Units) on the SGX-ST;
|
(ii)
|
the registration of the Final Prospectus by MAS;
|
(iii)
|
the entry into each of the Underwriting Agreements by the parties thereto; and
|
(iv)
|
each of the Underwriting Agreements not having been terminated pursuant to its terms on or prior to the IPO Settlement Date.
|
4.
|
Payment
|
4.1
|
The total consideration payable by the Investor for the Subscription Units referred to in Clause 2.3 shall be deemed to have been received by the Trustee upon the terms set forth in Clause 2.2 of the Set-Off Agreement by and among the Investor, the Trustee, the Manager and the parties named therein dated as 27 June 2019 (the “
Set-Off Agreement
”). The Investor will not be entitled to any interest which may accrue in relation to such deemed payment.
|
4.2
|
[Deleted
]
|
4.3
|
If, for any reason, (i) the IPO Units and the Subscription Units are not listed on the SGX- ST on or before 2.00 p.m. on the date falling 120 calendar days after the date of this Agreement (or such other time and date as is agreed between the Manager and the Underwriters) (the “
Back-Stop Date
”) or (ii) any of the Underwriting Agreements is terminated pursuant to its terms on or before such time on or prior to the Back-Stop Date (each, a “
Termination Event
”), the obligations of the Investor to subscribe for and the Manager’s obligation to allot or procure the allotment of the Subscription Units shall cease and if at the time of the Termination Event, the deemed payment for the Subscription Units has been made pursuant to Clause 4.1 and:
|
4.3.1
|
if the Subscription Units have not been validly allotted and issued to the Investor, the Manager will procure the Trustee to return to the Investor the amount deemed received from the Investor pursuant to Clause 4.1 without any interest thereon and without deduction for any fees and/or expenses; or
|
4.3.2
|
if the Subscription Units have been validly allotted and issued to the Investor pursuant to Clause 5 of this Agreement, the Manager will procure that such Subscription Units be redeemed at a price equal to the IPO Price and without deduction for any fees and/or expenses, and the Investor shall do all things to assist to cancel and/or return or procure the cancellation and/or return of the Subscription Units to the Manager,
|
4.4
|
All payments under this Agreement will be made without deduction or withholding for or on account of any taxes, duties or levies (including but not limited to any taxes, duties or levies on the supply of goods and services). If either Party is required by law to deduct or
|
5.
|
Delivery
|
5.1
|
Subject to Clause 5.2 and on the condition that the Investor has complied fully with, and is not in breach of, its obligations referred to in Clause 4.1 and its representations, warranties, acknowledgments and undertakings in this Agreement, the Manager will, on the IPO Settlement Date, credit or procure to be credited, the Subscription Units to such account opened by the Investor with The Central Depository (Pte) Limited (or to a sub- account opened by the Investor with its depository agent (as defined under the Securities and Futures Act, Chapter 289 of Singapore)), the account details of which the Investor will furnish in writing to the Manager or the Underwriters (as the Manager may direct) no later than 5.00 p.m. on the day falling five Business Days immediately prior to the IPO Settlement Date.
|
5.2
|
If the Investor fails to comply with its representations, warranties and undertakings in this Agreement other than Clause 4.1, the Manager reserves the right to terminate this Agreement (in consultation with the Underwriters) without any liability on the part of the Manager or the Underwriters to the Investor. In such event, all obligations and liabilities of the Manager under this Agreement shall cease and terminate (but without prejudice to any claim which the Manager or the Underwriters may have against the Investor arising out of its failure to comply with its representations, warranties and obligations under this Agreement).
|
5.3
|
The Investor agrees that the Underwriters shall have the unconditional right under the Contracts (Rights of Third Parties) Act to enforce the provisions of and rely on this Clause 5.
|
6.
|
Investor’s Representations, Warranties, Acknowledgements and Undertakings
|
6.1
|
As a condition of the agreement by the Manager to issue the Subscription Units to the Investor, and in consideration thereof, the Investor represents and warrants to and undertakes to the Manager and acknowledges and agrees that:
|
6.1.1
|
the Investor is duly organised and is validly existing as a limited liability company under the laws of the State of Delaware;
|
6.1.2
|
the Investor has the legal right and full power and authority to enter into and perform its obligations under this Agreement and all transactions contemplated under this Agreement;
|
6.1.3
|
it has obtained all approvals and consents necessary for its entry into and the discharge of its duties and obligations under this Agreement, the ownership by the Investor of the Subscription Units agreed to be subscribed and paid for by the Investor and the performance and consummation of all transactions contemplated under this Agreement;
|
6.1.4
|
the execution and delivery of, and the performance by the Investor of its obligations under, this Agreement, the ownership by the Investor of the Subscription Units agreed to be subscribed and paid for by the Investor, and all transactions contemplated under this Agreement:
|
(i)
|
have been duly authorised by all action required by any applicable laws and regulations;
|
(ii)
|
will not result in a breach of any provision of its certificate of formation, limited liability company agreement or any other constitutive documents;
|
(iii)
|
will not violate any order, judgment, award or decree of any court, arbitrator or governmental authority binding on or applicable to it or its assets;
|
(iv)
|
will not contravene any existing law, rule or regulation of any governmental agency or regulatory body or which is binding on or applicable to it or its assets; and
|
(v)
|
will not infringe in any material respect or result in any breach in any material respect of, any of the terms of, or constitute a default in any material respect under, any agreement, instrument or other obligation to which it is a party or it or its assets are subject;
|
6.1.5
|
there are no:
|
(i)
|
outstanding judgments, orders, injunctions or decrees of any governmental or regulatory body or court or arbitration tribunal against or affecting the business operations of the Investor or its subsidiaries;
|
(ii)
|
lawsuits, actions or proceedings pending or threatened against or affecting the Investor or its subsidiaries; or
|
(iii)
|
investigations by any governmental or regulatory body which are pending or threatened against the Investor or its subsidiaries;
|
6.1.6
|
this Agreement, when executed, will constitute valid and legally binding obligations of the Investor enforceable in accordance with its terms;
|
6.1.7
|
in making the decision to subscribe for the Subscription Units, the Investor acknowledges and confirms to each of the Manager and the Underwriters that:
|
(i)
|
it has not relied on any investigation that the Manager, the Sponsor or any of their respective affiliates or shareholders (together, the “
Relevant Group
”), representatives or advisors (including, without limitation, legal advisers, financial advisers, the Underwriters and each of their respective directors, employees, affiliates or representatives) of any member of the Relevant Group and such advisors' respective affiliates, partners, directors, agents, employees, controlling persons and representatives
|
(ii)
|
it has made its own independent investment decision regarding the Subscription Units based on its own knowledge (including information it may have as a result of the Investor’s own independent investigations or which is publicly available) and it has not received or relied on any advice or recommendation from the Relevant Group, the Advisory Group or any person acting on behalf of Prime US REIT, the Manager and/or the Sponsor;
|
(iii)
|
it has conducted its own independent investigation with respect to Prime US REIT, its subsidiaries, their respective assets and the Subscription Units and obtained its own independent advice (legal, tax, accounting or otherwise) to the extent it considers necessary or appropriate or otherwise has satisfied itself concerning, without limitation, the tax, legal, currency and other economic considerations related to the investment in the Subscription Units;
|
(iv)
|
the information contained in this Agreement, the draft Prospectus provided to it on a confidential basis and any other materials delivered to it are subject to change at any time and from time to time and, further, notwithstanding that any information concerning the Relevant Group may have been furnished to the Investor by or on behalf of the Relevant Group on or before the date hereof, in making its own independent investment decision regarding the Subscription Units, the Investor has relied and will rely only on information provided in the Final Prospectus to be dated and issued by the Manager on or around the day the Singapore Offer Agreement is signed and not any other information (including any draft or preliminary Prospectus, and any amendments or supplements thereto, whether or not the same is publicly available or lodged with the MAS), and each member of the Relevant Group and the Advisory Group makes no representation and gives no warranty or undertaking as to the accuracy or completeness of any such information not contained in the Final Prospectus (including any matters set out in the draft or preliminary Prospectus or any other materials provided to it) and none of the members of the Relevant Group or the Advisory Group has or will have any liability to the Investor or its affiliates or advisors resulting from their use of such information or for any opinions, errors, omissions made by any of them. For the avoidance of doubt, it shall be the responsibility of the Investor to obtain a copy of the Final Prospectus whether from the Manager or otherwise. Further, the Investor acknowledges and confirms that each member of the Relevant Group (excluding the Manager) and the Advisory Group (including the Underwriters) has no responsibility and undertakes no liability to the Investor, or any of its affiliates for the information contained in the Prospectus, makes no representation, warranty or covenant as to the accuracy or completeness of the Final
|
(v)
|
the Relevant Group and the Advisory Group make no representation and give no warranty or undertaking that the IPO or the Listing will proceed or be completed (within any time period or at all). The Investor further agrees that none of the Relevant Group, or the advisors (including, without limitation, legal advisers, financial advisers or the Underwriters) to the Relevant Group or the Advisory Group, will have any liability whatsoever to the Investor or any person asserting any claims on the Investor’s behalf in connection with the offering and sale of the Subscription Units or in the event the IPO or the Listing does not proceed or is not completed for any reason;
|
(vi)
|
its participation in any investment of the Subscription Units has been arranged without the Underwriters’ undertaking any due diligence procedures on its behalf and that it may not rely on any investigation (if any) that may have been conducted or any legal opinion, due diligence reviews or other advice provided with respect to or in connection with the IPO, the Listing, Prime US REIT or the Relevant Group. The Investor also confirms that it has such knowledge and experience in financial and business matters as enables it to evaluate the merits and risks of a decision to participate in an investment of and to hold the Subscription Units and has the ability to bear the economic risk associated with its purchase of, and is able to sustain a complete loss of its investment in, the Subscription Units, and that it will conduct or has conducted its own investigation of any investment in the Subscription Units or Prime US REIT and received all the information it considers necessary and appropriate for deciding whether to purchase the Subscription Units, and none of the members of the Relevant Group and the Advisory Group has made any warranty, representation or recommendation to the Investor as to the merits of the Subscription Units, the purchase or offer thereof, or as to the condition, financial or otherwise, of Prime US REIT, its subsidiaries or their respective assets or as to any other matter relating thereto or in connection therewith;
|
(vii)
|
at or around the time of entering into this Agreement or at any time hereafter but before the closing of the IPO, the Manager and the Underwriters have entered into, or may enter into, agreements similar to this Agreement with one or more other investors as part of the IPO;
|
(viii)
|
no public market now exists for the Units, and the Manager and Underwriters have made no representation or warranty that a liquid or active market will ever exist for the Units; and
|
(ix)
|
the Investor agrees that each member of the Relevant Group and the Advisory Group will have the unconditional right under the Contracts
|
6.1.8
|
the Investor will not assign or transfer its rights or obligations arising under this Agreement without the prior written agreement of the Manager and the Underwriters;
|
6.1.9
|
the Investor will comply with any requirements imposed or which may be imposed by the SGX-ST and/or by applicable laws or regulations in connection with the IPO (including any lock-ups or transfer of Units) and shall comply with any notice in respect of the same from the Manager, the SGX-ST and/or the Underwriters. The Investor has also complied and will comply with all applicable laws and regulations in all jurisdictions relevant to its acquisition of the Subscription Units;
|
6.1.10
|
if and to the extent the Investor has received (and may in future receive) information that may constitute non-public information in connection with its investment in (and holding of) the Subscription Units, it will not, and will cause its affiliates, associates, directors, officers, employees, advisers and representatives not to purchase, sell or otherwise trade, directly or indirectly, in the Subscription Units, the Units or any other securities in a manner that could result in any violation of the securities laws of the United States, Singapore or any other applicable jurisdiction relevant to such dealing;
|
6.1.11
|
the Investor has obtained all necessary legal, governmental and regulatory consents and any third party consents and approvals required in order to enable it to lawfully enter into, exercise its rights and comply with its obligations under this Agreement, own the Subscription Units and to ensure that such obligations are legally binding and enforceable obligations of the Investor;
|
6.1.12
|
this Agreement and the relationship and arrangements between both Parties contemplated by this Agreement may be required to be described in the Prospectus and other marketing materials for the IPO and, specifically, this Agreement may be a material contract required to be filed with regulatory authorities and/or made available for public inspection in connection with the IPO;
|
6.1.13
|
the Investor will accept the Subscription Units on and subject to the terms and conditions of the Trust Deed;
|
6.1.14
|
other than the subscription of the Subscription Units under this Agreement, the Investor will not, and will procure that no member of the Investor Group will, subscribe and/or purchase any other Units under the IPO, unless such subscription and/or purchase has been disclosed to the Underwriters in writing prior to the IPO Settlement Date in accordance with Clause 6.4;
|
6.1.15
|
it is subscribing for the Subscription Units for its own account and not with a view to any distribution thereof; and
|
6.1.16
|
the Investor acknowledges that the Units are subject to restrictions on beneficial and constructive ownership and on transfer for the purpose of enabling certain subsidiaries of Prime US REIT to meet the requirements for qualification and taxation as real estate investment trusts under the IRC, all as described in the Trust Deed. Subject to further restrictions and exceptions outlined in the Trust
|
6.2
|
The representations and warranties of the Investor in Clause 6.1 will be deemed to be repeated at all times from the date hereof up to and including the IPO Settlement Date.
|
6.3
|
The Investor acknowledges that the Manager and its affiliates and the Underwriters have relied and will rely on the truth and accuracy of the representations, warranties, acknowledgements and agreements set out in this Agreement by the Investor and agrees to notify the Manager and the Underwriters promptly in writing if any of the representations, warranties, acknowledgements and agreements herein cease to be accurate and complete in any material respect.
|
6.4
|
The Investor further consents and undertakes to:
|
6.4.1
|
The Manager and the Underwriters and their respective affiliates to disclose to the Manager and the Underwriters at least three Business Days prior to the IPO Settlement Date, to the best of the Investor’s knowledge and belief, having taken all reasonable steps and made all reasonable enquiries, the number of Units applied for by any entity in the Investor Group (if any); and
|
6.4.2
|
provide such other information which may be required by the Manager and the Underwriters for the purpose of (i) satisfying their disclosure obligations under applicable laws, regulations and the listing rules of the SGX-ST in connection with the IPO or the Listing, and (ii) ensuring their compliance with applicable laws, regulations and the listing rules of the SGX-ST.
|
7.
|
The Manager’s Representations and Warranties
|
7.1
|
As a condition of the agreement by the Investor to subscribe and pay for the Subscription Units, and in consideration thereof, the Manager hereby represents, warrants and undertakes to the Investor that:
|
7.1.1
|
the Manager has been duly organised and is validly existing as a corporation under the laws of Singapore;
|
7.1.2
|
the Manager has the legal right and full power and authority to enter into and perform its obligations under this Agreement and all transactions contemplated under this Agreement;
|
7.1.3
|
the Manager has obtained all approvals and consents necessary for its entry into and the discharge of its duties and obligations under this Agreement and all transactions contemplated under this Agreement;
|
7.1.4
|
the execution and delivery of, and the performance by the Manager of its obligations under, this Agreement and all transactions contemplated under this Agreement:
|
(i)
|
will not result in a breach of any provision of its memorandum or articles of association or equivalent constitutive documents;
|
(ii)
|
will not violate any order, judgment, award or decree of any court, arbitrator or governmental authority binding on it or its assets;
|
(iii)
|
will not contravene any existing law, rule or regulation of any governmental agency or regulatory body which is binding on it or its assets; and
|
(iv)
|
will not infringe in any material respect or result in any breach in any material respect of, any of the terms of, or constitute a default in any material respect under, any agreement, instrument or other obligation to which it is a party or is subject;
|
7.1.5
|
this Agreement, when executed, will constitute valid and binding obligations of the Manager enforceable in accordance with its terms; and
|
7.1.6
|
the Subscription Units, when paid up and issued, will be free from all liens, charges, encumbrances and other third party rights, freely transferable in Singapore and there are no legal restrictions on the voting or transfer or disposal of the Subscription Units under the laws of Singapore, save for the restriction on transfer of the Subscription Units referred to in Clauses 6.1.8, 6.1.9, 6.1.16 and 9.
|
7.2
|
The representations and warranties of the Manager in Clause 7.1 will be deemed to be repeated at all times from the date hereof up to and including the IPO Settlement Date.
|
7.3
|
The Investor acknowledges and agrees that neither the Manager nor any member of the Advisory Group makes any representations and warranties regarding the matters set out in the Prospectus or any other materials delivered to the Investor, and neither the Manager nor any member of the Advisory Group shall have any liability to the Investor in respect of such matters except in the case of the Manager, due to negligence, fraud, wilful default, misrepresentation or dishonesty, and the Investor acknowledges and agrees that such matters may change at any time and from time to time.
|
8.
|
Disclosures
|
8.1
|
The Investor irrevocably consents and undertakes (to provide, to the extent possible by law, a description of its organisation and business activities which shall be true and accurate in all respects and does not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading, and such other information and supporting documentation in respect thereof as may be reasonably required by the Manager and the Underwriters which shall be true and accurate in all respects and not misleading for the purpose of satisfying the Manager’s and the Underwriters’ disclosure obligations in connection with the Prospectus under applicable laws, regulations and the listing rules of the SGX-ST, and to the inclusion of such description, the Investor’s name as well as the matters relating to the Investor’s
|
8.2
|
The Investor further consents and undertakes to the Manager and its respective affiliates as soon as practicable and to the extent legally possible, to provide such information (including information relating to an entity within the Investor’s group of companies applying for the IPO Units, other than the Subscription Units) and supporting documents as may be required by MAS, the SGX-ST and other governmental, public, monetary or regulatory authorities or bodies or securities exchanges, or which otherwise relates to any matter which may be required by the Manager and the Underwriters for the purposes of (i) satisfying their disclosure obligations under applicable laws, regulations and the listing rules of the SGX-ST in connection with the IPO or the Listing and (ii) ensuring their compliance with applicable laws and regulations and the listing rules of the SGX-ST (including without limitation, applicable companies and securities laws and regulations and the US Securities Act) and/or the requests of competent regulatory authorities or bodies (including without limitation, the SGX-ST and MAS).
|
8.3
|
The Investor agrees that the Underwriters will have the unconditional right under the Contracts (Rights of Third Parties) Act to enforce the provisions of and rely on this Clause 8.
|
8.4
|
Each of the Manager and the Investor acknowledges that the Underwriters and their affiliates will rely upon the truth and accuracy of the acknowledgements, representations and warranties made by it in Clause 7 and Clauses 6, 8 and 9, respectively.
|
8.5
|
Without prejudice to the foregoing provisions of this Agreement, the Investor acknowledges and agrees that it will not have any rights to claim against the Underwriters and their affiliates for any breach of representations, warranties and undertakings given by the Manager and that the Underwriters and their affiliates shall not have any liability to the Investor or any person asserting claims on the Investor’s behalf in connection with the IPO and the offering and sale of the Subscription Units.
|
8.6
|
The Investor further acknowledges and agrees that this Agreement constitutes a material contract for the purposes of the Prospectus, and accordingly, a copy of this Agreement shall be made available by the Manager for public inspection for a period of six months after the date of the Final Prospectus or such other period as required under the relevant laws and regulations.
|
9.
|
US Securities Act Exemption
|
9.1
|
The Investor expressly acknowledges and understands that the Subscription Units have not been and will not be registered under the US Securities Act or under any state securities laws of the United States, and that no registration has been or will be undertaken by Prime US REIT under the Investment Company Act. The Investor understands and acknowledges that the Subscription Units are being offered and sold to it
|
9.1.1
|
it is authorised to consummate the purchase of the Subscription Units in compliance with all applicable laws and regulations, including those of Singapore;
|
9.1.2
|
it is an “accredited investor” as that term is defined in Regulation D promulgated under the US Securities Act;
|
9.1.3
|
it was not organised for the purpose of acquiring the Subscription Units;
|
9.1.4
|
it has not acquired the Subscription Units as a result of, and will not itself engage in, (i) any “directed selling efforts” (as defined in Regulation S) in the United States in respect of the Subscription Units, which would include any activities undertaken for the purpose of, or that could reasonably be expected to have the effect of, conditioning the market in the United States for the resale of the Subscription Units, or (ii) any form of general solicitation or general advertising (as defined in Rule 502(c) of Regulation D under the US Securities Act);
|
9.1.5
|
upon a proposed sale, transfer, assignment, pledge or other disposition of the Subscription Units, the Investor will notify any purchaser of such Subscription Units, the executing broker and any other agent of the transferor involved in selling the securities, as applicable, of the transfer restrictions set out in this Agreement that are applicable to the Subscription Units being sold and will require the broker and such other agent, as applicable, to abide by such restrictions;
|
9.1.6
|
it will comply with the securities laws of the United States and other jurisdictions in connection with the disposal of any Subscription Units and it acknowledges the Subscription Units are “restricted securities” under Rule 144 of the US Securities Act and such Subscription Units may only be sold upon subsequent registration under the US Securities Act or an exemption from registration under the US Securities Act;
|
9.1.7
|
it is purchasing the Subscription Units for its own account and not with a view to any distribution thereof; and
|
9.1.8
|
it acknowledges that the Manager and its affiliates, and the Advisory Group will rely upon the truth and accuracy of the foregoing acknowledgments, representations and agreements set forth in this Agreement, including but not limited to Clause 6, Clause 8 and this Clause 9.1 and in Clauses 9.2 and 9.3 below (as appropriate). and agrees that, if any of such acknowledgments, representations or agreements are no longer accurate, it will promptly notify the Manager and the Underwriters, and if it is acquiring any Subscription Units as a fiduciary or agent for one or more accounts, it represents that it has sole investment discretion with respect to each such account and that it has full power to make the foregoing acknowledgments, representations and agreements on behalf of each such account.
|
9.2
|
The Investor understands that none of the Manager or any of the Underwriters has made any representation as to the availability of any exemption under the US Securities Act for any subsequent reoffer, resale, pledge or transfer of the Subscription Units.
|
9.3
|
The representations and warranties of the Investor in Clause 9.1 will be deemed to be repeated at all times from the date hereof up to and including the IPO Settlement Date.
|
10.
|
General
|
10.1
|
Assignability
|
10.2
|
Notices
|
10.3
|
Waiver
|
10.3.1
|
Save in the case of fraud, each Party undertakes to the other Party not to make or pursue any claim against the officers, employees or agents of the other Party in connection with assisting the other Party in giving the warranties and/or entering
|
10.3.2
|
Either Party may at any time waive in whole or in part and conditionally or unconditionally any of the obligations of the other Party set out in this Agreement. No acquiescence, waiver or other indulgence granted by either Party to the other Party will in any way discharge or relieve that other Party from any of its other obligations under this Agreement. Any waiver of any breach of this Agreement shall be made expressly in writing and shall not be deemed a waiver of any subsequent breach of this Agreement.
|
10.4
|
Variation
|
10.5
|
Time of the Essence
|
10.6
|
Rights and Remedies
|
10.7
|
Contracts (Rights of Third Parties) Act
|
10.8
|
Severability
|
10.9
|
Entire Agreement
|
10.10
|
Governing Law and Jurisdiction
|
10.11
|
Appointment of Process Agent
|
10.11.1
|
The Investor has appointed or will appoint an agent to accept service of process in Singapore in any legal action or proceedings arising out of this Agreement, service upon whom will be deemed completed whether or not forwarded to or received by the Investor. The Investor will inform the Manager (or its representatives) of the name and address of the appointed process agent within two days of the date of this Agreement.
|
10.11.2
|
The Investor will inform the Manager, in writing, of any change in the address of the process agent of the Investor within 28 days and such change in address will not be effective until such notice is received or deemed to be received by the Manager pursuant to Clause 10.2.
|
10.11.3
|
Such service will be deemed to be completed on delivery to the process agent (whether or not it is forwarded to and received by the Investor). If such process agent ceases to be able to act as such or to have an address in Singapore, the Investor irrevocably agrees to immediately appoint a new process agent in Singapore acceptable to the Manager and to deliver to the Manager within 14 days a copy of a written acceptance of appointment by the process agent.
|
10.11.4
|
Nothing in this Agreement will affect the right to serve process in any other manner permitted by law or the right to bring proceedings in any other jurisdiction for the purposes of the enforcement or execution of any judgment or other settlement in any other courts.
|
10.12
|
Counterparts
|
10.13
|
Further Assurance
|
10.14
|
Costs and Expenses
|
10.15
|
Interest
|
10.16
|
United States Tax Documentation
|
10.16.1
|
Investors that are not “United States persons” are required to provide information for withholding tax purposes on an applicable Internal Revenue Service Form W- 8, which forms include:
|
(a)
|
Form W-8BEN (Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding),
|
(b)
|
Form W-8BEN-E (Certificate of Entities Status of Beneficial Owner for United States Tax Withholding and Reporting (Entities)),
|
(c)
|
Form W-8IMY (Certificate of Foreign Intermediary, Foreign Flow-Through Entity, or Certain U.S. Branches for United States Tax Withholding),
|
(d)
|
Form W-8EXP (Certificate of Foreign Government or Other Foreign Organization for United States Tax Withholding), and
|
(e)
|
Form W-8ECI (Certificate of Foreign Person’s Claim That Income Is Effectively Connected With the Conduct of a Trade or Business in the United States).
|
10.16.2
|
Investors that are not “United States persons” are also required to establish their eligibility for the United States portfolio interest exemption by providing a U.S. Tax Compliance Certificate, as set out in Appendix I of the Prospectus, which requires each Investor to make certain representations with respect to (i) sole beneficial of the Units; (ii) the Investor is not a bank within the meaning of Section 881(c)(3)(A) of the IRC; (iii) the Investor is not a 10% shareholder of an Issuer within the meaning of Section 871(h)(3)(B) of the IRC; and (iv) it is not a controlled foreign corporation related to the Issuer as described in Section 881(c)(3)(C) of the IRC.
|
The Manager
|
|
|
|
We hereby confirm our agreement to the foregoing.
|
|
|
|
SIGNED by Sandip Talukdar
|
|
|
/s/ Sandip Talukdar
|
for and on behalf of
|
|
|
|
KBS US PRIME PROPERTY MANAGEMENT PTE. LTD.
|
|
(as manager of Prime US REIT)
|
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
Name:
|
Deborah Montgomery
|
Address:
|
61 Exeter
|
1.
|
We refer to the subscription agreement (the
"Subscription Agreement")
dated 27 June 2019 entered into between KBS US Prime Property Management Pte. Ltd., as manager of Prime US REIT (the
"Manager")
and KBS REIT Properties Ill LLC (the
"Investor")
in relation to the subscription of 228,408,999 units in Prime US REIT
("Subscription Units")
by the Investor.
|
2.
|
We refer to clause 6.1.16 of the Subscription Agreement and acknowledge and agree that the Investor has or will be granted a waiver by the trustee of Prime US REIT (on the recommendation of the Manager) allowing the Investor to own up to a 33.3% (instead of up to 26.0%) interest in Prime US REIT.
|
3.
|
We refer to the initial public offering of Units (as defined in the Subscription Agreement) in Prime US REIT, which includes an international placement of 318,442,200 Units (the
"Placement Tranche").
Separate from the subscription of the Subscription Units by the Investor pursuant to the Subscription Agreement, the Investor has applied to subscribe for Units as part of the Placement Tranche. As a condition to the Manager's acceptance of such application, the Investor hereby agrees that each of the provisions of clauses 6.1.7 and 9 of the Subscription Agreement shall also apply in respect of any and all Units in Prime US REIT subscribed for by the Investor in the Placement Tranche (the
"Placement Units").
Accordingly, the Investor hereby represents, acknowledges and agrees to each of the provisions of clauses 6.1.7 and 9 of the Subscription Agreement, substituting the term "Subscription Units" each time it appears in such clause for the term "Placement Units". The Investor acknowledges that the Underwriters and/or the members of the Advisory Group, as such terms are defined in the Subscription Agreement, shall have the unconditional right under the Contracts (Rights of Third Parties) Act to rely on this provision.
|
4.
|
The Investor understands that neither the US Securities and Exchange Commission nor any state securities commission nor any other US regulatory authority has approved or disapproved of the Placement Units or the Prospectus (as defined in the Subscription Agreement), passed upon or endorsed the merits of the initial public offering or confirmed the accuracy or determined the adequacy of the Prospectus. Moreover, the Investor understands that the Prospectus has not been drafted to comply with the form and disclosure requirements that would apply were the Placement Units being registered pursuant to the US Securities Act, including without limitation those pursuant to Form 20-F, Regulation S-K and Regulation S-X.
|
5.
|
This letter is governed by, and shall be construed in accordance with, the laws of Singapore, and each party to this letter irrevocably submits to the non-exclusive jurisdiction of the courts of Singapore.
|
6.
|
This letter may be executed in any number of counterparts, each of which, when executed and delivered (whether in original or fax copy), will be an original, but all the counterparts together will constitute one and the same document.
|
7.
|
This letter may only be amended or supplemented in writing signed by or on behalf of each of the parties hereto.
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
TABLE OF CONTENTS
|
||||
Contents
|
Page
|
|
||
1.
|
Definitions and Interpretation
|
2
|
|
|
2.
|
Settlement
|
4
|
|
|
3.
|
General
|
6
|
|
(1)
|
THE SELLER PARTIES
, each a Delaware limited liability company or Delaware statutory trust and as identified in Exhibit A attached hereto (collectively, “
Vendor
”);
|
(2)
|
THE BUYER PARTIES
, each a Delaware limited liability company and as identified in Exhibit A attached hereto (each a “
Property Holding LLC
” and collectively, “
Purchaser
”);
|
(3)
|
KBS US PRIME PROPERTY MANAGEMENT PTE. LTD.
, a company established and validly existing under the laws of Singapore and having its registered office at 1 Raffles Place, #40-01 One Raffles Place, Singapore 048616, in its capacity as manager of Prime US REIT (the “
Manager
”);
|
(4)
|
DBS TRUSTEE LIMITED
, a company established and validly existing under the laws of Singapore and having its registered office at 12 Marina Boulevard, Marina Bay Financial Centre Tower 3, Singapore 018982, in its capacity as trustee of Prime US REIT (the “
Trustee
”);
|
(5)
|
KBS REIT PROPERTIES III LLC
,
a Delaware limited liability company and having its principal office at 800 Newport Center Drive, Suite 700, Newport Beach, California 92660 (the “
Investor
”);
|
(6)
|
PRIME US REIT S1 PTE. LTD.
, a company established and validly existing under the laws of Singapore and having its registered office at 50 Raffles Place, #32-01 Singapore Land Tower, Singapore 048623 (“
SSUB1
”);
|
(7)
|
PRIME US-SUB REIT, INC.
, a Delaware corporation and having its principal office at 800 Newport Center Drive, Suite 700, Newport Beach, California 92660 (“
Parent US REIT
”);
|
(8)
|
PRIME US-UPPER TIER, LLC
, a Delaware limited liability company and having its principal office at 800 Newport Center Drive, Suite 700, Newport Beach, California 92660 (“
Upper-Tier U.S. LLC
”).
|
(9)
|
PRIME US-MIDDLE TIER, LLC
, a Delaware limited liability company and having its principal office at 800 Newport Center Drive, Suite 700, Newport Beach, California 92660 (“
Middle-Tier U.S. LLC
”);
|
(10)
|
PRIME US PROPERTIES, LLC
, a Delaware limited liability company and having its principal office at 800 Newport Center Drive, Suite 700, Newport Beach, California 92660;
|
(11)
|
PRIME US-LOWER TIER, LLC
, a Delaware limited liability company and having its principal office at 800 Newport Center Drive, Suite 700, Newport Beach, California 92660 (“
Lower-Tier U.S. LLC
”); and
|
(12)
|
PRIME US-ACQUISITION I, LLC
, a Delaware limited liability company and having its principal office at 800 Newport Center Drive, Suite 700, Newport Beach, California 92660;
|
(A)
|
The Trustee and SSUB1 have entered into a subscription agreement (“
RPS Subscription Agreement
”) under which SSUB1 proposes to allot and issue to the Trustee, and the Trustee agrees to subscribe for redeemable preference shares in the capital of SSUB1, subject to the terms and conditions of the RPS Subscription Agreement.
|
(B)
|
The board of directors of the Parent US REIT has authorised the allotment and issuance of 1,000,000 shares of its common stock to SSUB 1 (representing a 100% interest in the Parent US REIT).
|
(C)
|
The board of directors of the Parent US REIT has authorised the formation and capitalisation of Upper-Tier U.S. LLC with the Parent US REIT as the sole member of Upper-Tier U.S. LLC.
|
(D)
|
The board of directors of the Parent US REIT has authorised the formation and capitalisation of Middle-Tier U.S. LLC with Upper-Tier U.S. LLC as the sole member of Middle-Tier U.S. LLC.
|
(E)
|
The board of directors of the Parent US REIT has authorised the formation and capitalisation of Lower-Tier U.S. LLC with Middle-Tier U.S. LLC as the sole member of Lower-Tier U.S. LLC.
|
(F)
|
The board of directors of the Parent US REIT has authorised the formation and capitalisation of Prime US Properties LLC with Middle-Tier U.S. LLC as the sole member of Prime US Properties LLC.
|
(G)
|
The board of directors of the Parent US REIT has authorised the formation and capitalisation of Prime US-Acquisition I, LLC with Prime US Properties LLC as the sole member of Prime US-Acquisition I, LLC.
|
(H)
|
The board of directors of the Parent US REIT has authorised the formation and capitalisation of each Property Holding LLC with Lower-Tier U.S. LLC or Prime US-Acquisition I, LLC as the sole member and manager, as the case may be.
|
(I)
|
The applicable Vendor has agreed to sell to the applicable Purchaser, and the applicable Purchaser has agreed to purchase from the applicable Vendor, 11 properties, as identified in Exhibit A attached hereto, and have in connection thereto, entered into the Portfolio Purchase and Sale Agreement and Escrow Instructions by and between the Vendor and Purchaser (the “
Sale and Purchase Agreement
”).
|
(J)
|
The Manager is proposing to offer for subscription units in Prime US REIT (“
New Units
”) to the Investor, and has in connection thereto, entered into a subscription agreement with the Investor (the “
Subscription Agreement
”).
|
(K)
|
The parties acknowledge that at no time will the Investor and its affiliates own more than 16% of the units of Prime US REIT, and in addition, that the New Units will not be issued prior to the issuance of other units of Prime US REIT to the cornerstone investors.
|
(L)
|
The parties to this agreement (“
Parties
”) are desirous to enter into this Agreement for the settlement of certain of their payment rights and obligations under the Transactions (as defined herein).
|
1.
|
Definitions and Interpretation
|
1.1
|
In this Agreement, except to the extent that the context requires otherwise:
|
1.2
|
Headings, Clauses etc.
|
2.
|
Settlement
|
2.1
|
The Investor has requested for a set-off of the payment of the Subscription Amount (as defined in the Subscription Agreement) (the “
Relevant Amount
”) which is due from the Investor pursuant to the Subscription Agreement for the subscription of the New Units against a portion (equivalent to the Relevant Amount) of the purchase consideration payable by the Purchaser to the Vendor under the Sale and Purchase Agreement, and the Parties agree to the aforesaid set-off subject to the terms of this Agreement.
|
2.2
|
Upon receipt by the Vendor of the purchase price (as stated in the Sale and Purchase Agreement) less the Relevant Amount:
|
2.2.1
|
the Vendor shall discharge the Purchaser from and have no further claim against, the Purchaser in respect of the amount set-off as set out in Clause 2.1 above under the Sale and Purchase Agreement; and
|
2.2.2
|
the Manager shall discharge the Investor from, and have no further claim against, the Investor in respect of the payment of the subscription amounts due from the Investor for the subscription of the New Units under the Subscription Agreement.
|
2.3
|
In connection with the set-off as agreed in Clauses 2.1 and 2.2 above (the “
Set-Off
”), the Trustee, SSUB1, Parent US REIT, Upper-Tier U.S. LLC, Middle-Tier U.S. LLC, Prime US Properties, LLC, Lower-Tier U.S. LLC, Prime US-Acquisition I, LLC and the Purchaser agree that for purposes of the set-off, the Relevant Amount shall not be transferred in cash to each of SSUB1, Parent US REIT, Upper-Tier U.S. LLC, Middle-Tier U.S. LLC, Prime US Properties, LLC, Lower-Tier U.S. LLC, Prime US-Acquisition I, LLC and Property Holding LLC, but instead, the Relevant Amount shall be deemed to have been received by each of SSUB1, Parent US REIT, Upper-Tier U.S. LLC, Middle-Tier U.S. LLC, Prime US Properties, LLC, Lower-Tier U.S. LLC, Prime US-Acquisition I, LLC and each of the Property Holding LLC in the following manner:
|
2.3.1
|
SSUB1 agrees that following the Set-Off, notwithstanding that the actual subscription amount received by SSUB1 in cash from the Trustee under the RPS Subscription Agreement is minus the Relevant Amount, the full amount due from the Trustee under the RPS Subscription Agreement (i.e. inclusive of the Relevant Amount which has been Set-Off) shall be deemed to have been received by SSUB1 and shall be recorded as such by SSUB1.
|
2.3.2
|
Parent US REIT agrees that following the Set-Off, notwithstanding that the actual capital contribution amount received by Parent US REIT in cash from SSUB1 is minus the Relevant Amount, the full amount due from SSUB1 (i.e. inclusive of the Relevant Amount which has been Set-Off) shall be deemed to have been received by Parent US REIT and shall be recorded as such by Parent US REIT.
|
2.3.3
|
Upper-Tier U.S. LLC agrees that following the Set-Off, notwithstanding that the actual capital contribution amount received by Upper-Tier U.S. LLC in cash from Parent US REIT is minus the Relevant Amount, the full amount due from Parent US REIT (i.e. inclusive of the Relevant Amount which has been Set-Off) shall be deemed to have been received by Upper-Tier U.S. LLC and shall be recorded as such by Upper-Tier U.S. LLC.
|
2.3.4
|
Middle-Tier U.S. LLC agrees that following the Set-Off, notwithstanding that the actual capital contribution amount received by Middle-Tier U.S. LLC in cash from Upper-Tier U.S. LLC is minus the Relevant Amount, the full amount due from Upper-Tier U.S. LLC (i.e. inclusive of the Relevant Amount which has been Set-Off) shall be deemed to have been received by Middle-Tier U.S. LLC and shall be recorded as such by Middle-Tier U.S. LLC.
|
2.3.5
|
Each of Prime US Properties, LLC and Lower-Tier U.S. LLC agrees that following the Set-Off, notwithstanding that the actual capital contribution amount received by Prime US Properties, LLC and/or Lower-Tier U.S. LLC in cash from Middle-Tier U.S. LLC is minus the portion of the Relevant Amount receivable by Prime US Properties, LLC and Lower-Tier U.S. LLC, respectively, the full amount due from Middle-Tier U.S. LLC (i.e. inclusive of the portion of the Relevant Amount receivable by Prime US Properties, LLC and Lower-Tier U.S. LLC which has been Set-Off) shall be deemed to have been received by Prime US Properties, LLC and/or Lower-Tier U.S. LLC and shall be recorded as such by Prime US Properties, LLC and/or Lower-Tier U.S. LLC .
|
2.3.6
|
Prime US-Acquisition I, LLC agrees that following the Set-Off, notwithstanding that the actual capital contribution amount received by Prime US-Acquisition I, LLC in cash from Prime US Properties, LLC is minus the portion of the Relevant Amount receivable by Prime US-Acquisition I, LLC, the full amount due from Prime US Properties, LLC (i.e. inclusive of the portion of the Relevant Amount receivable by Prime US-Acquisition I, LLC which has been Set-Off) shall be deemed to have been received by Prime US-Acquisition I, LLC and shall be recorded as such by Prime US-Acquisition I, LLC .
|
2.3.7
|
Each Property Holding LLC agrees that following the Set-Off, notwithstanding that the actual capital contribution amount received by the Property Holding LLC in cash from the Lower-Tier U.S. LLC or Prime US-Acquisition I, LLC, as the case may be, is minus the portion of the Relevant Amount receivable by that Property Holding LLC, the full amount due from the Lower-Tier U.S. LLC or Prime US-Acquisition I, LLC, as the case may be, (i.e. inclusive of the portion of the Relevant Amount receivable by that Property Holding LLC which has been Set-Off) shall be deemed to have been received by that Property Holding LLC and shall be recorded as such by that Property Holding LLC.
|
3.
|
General
|
3.1
|
Assignability
|
3.2
|
Notices
|
Purchaser
|
:
|
c/o KBS US Prime Property Management Pte. Ltd.
|
|
|
1 Raffles Place,
#40-01 One Raffles Place,
Singapore 048616
|
Attention
|
:
|
Chief Executive Officer / Chief Financial Officer
|
Telephone Number
|
:
|
+1 (949) 417-6517 / +65 9826 3537
|
Email Address
|
:
|
bcambon@primeusreit.com / stalukdar@primeusreit.com
|
With a copy to:
|
|
|
Address:
|
|
c/o KBS Realty Advisors, LLC, 800 Newport Center Drive, Suite 700, Newport Beach, CA 92660
|
Attention:
|
|
Charles J. Schreiber, Jr., and Jeffrey Waldvogel
|
Vendor
|
:
|
c/o KBS Capital Advisors LLC
|
|
|
800 Newport Center Drive
Suite 700, Newport Beach
CA 92660
|
Attention
|
:
|
Jeffrey Waldvogel / Rodney Richerson
|
Telephone Number
|
:
|
+1 (949) 797-0327 / +1 (949) 417-6515
|
Email Address
|
:
|
jwaldvogel@kbs.com / rricherson@kbs.com
|
Manager
|
:
|
KBS US Prime Property Management Pte. Ltd.
|
|
|
1 Raffles Place,
|
|
|
#40-01 One Raffles Place,
Singapore 048616
|
Attention
|
:
|
Chief Executive Officer / Chief Financial Officer
|
Telephone Number
|
:
|
+1 (949) 417-6517 / +65 9826 3537
|
With a copy to:
|
|
|
Address:
|
|
c/o KBS Realty Advisors, LLC, 800 Newport Center Drive, Suite 700, Newport Beach, CA 92660
|
Attention:
|
|
Charles J. Schreiber, Jr., Jeffrey Waldvogel, and Mark Krotine
|
Email Address
|
:
|
bcambon@primeusreit.com / stalukdar@primeusreit.com
|
Investor
|
|
KBS REIT Properties III LLC
|
|
|
800 Newport Center Drive
Suite 700, Newport Beach
California 92660
|
Attention
|
:
|
Jeffrey Waldvogel / Rodney Richerson
|
Telephone Number
|
:
|
+1 (949) 797-0327 / +1 (949) 417-6515
|
Email Address
|
:
|
jwaldvogel@kbs.com / rricherson@kbs.com
|
SSUB1
|
:
|
c/o KBS US Prime Property Management Pte. Ltd.
|
|
|
1 Raffles Place,
#40-01 One Raffles Place,
Singapore 048616
|
Attention
|
:
|
Chief Executive Officer / Chief Financial Officer
|
Telephone Number
|
:
|
+1 (949) 417-6517 / +65 9826 3537
|
Email Address
|
:
|
bcambon@primeusreit.com / stalukdar@primeusreit.com
|
Parent US REIT
|
:
|
c/o KBS US Prime Property Management Pte. Ltd.
|
|
|
1 Raffles Place,
#40-01 One Raffles Place,
Singapore 048616
|
Attention
|
:
|
Chief Executive Officer / Chief Financial Officer
|
Telephone Number
|
:
|
+1 (949) 417-6517 / +65 9826 3537
|
Email Address
|
:
|
bcambon@primeusreit.com / stalukdar@primeusreit.com
|
Upper-Tier Sub-US REIT
|
:
|
c/o KBS US Prime Property Management Pte. Ltd.
|
|
|
1 Raffles Place,
#40-01 One Raffles Place,
Singapore 048616
|
Attention
|
:
|
Chief Executive Officer / Chief Financial Officer
|
Telephone Number
|
:
|
+1 (949) 417-6517 / +65 9826 3537
|
Email Address
|
:
|
bcambon@primeusreit.com / stalukdar@primeusreit.com
|
3.3
|
Variation
|
3.4
|
Rights and Remedies
|
3.5
|
Contracts (Rights of Third Parties) Act
|
3.6
|
Severability
|
3.7
|
Entire Agreement
|
3.8
|
Governing Law and Jurisdiction
|
3.9
|
Counterparts
|
3.10
|
Further Assurance
|
3.11
|
Costs and Expenses
|
3.12
|
Limitation of Liability
|
|
SELLER PARTY (“VENDOR”)
|
BUYER PARTY (“PURCHASER”)
|
1.
|
Village Center Station II Owner, LLC, a Delaware limited liability company
|
Prime US-Village Center Station II, LLC, a Delaware limited liability company
|
2.
|
KBSIII Tower at Lake Carolyn, LLC, a Delaware limited liability company
|
Prime US-Tower At Lake Carolyn, LLC, a Delaware limited liability company
|
3.
|
KBSIII One Washingtonian, LLC, a Delaware limited liability company
|
Prime US-One Washingtonian, LLC, a Delaware limited liability company
|
4.
|
KBSIII 222 Main, LLC, a Delaware limited liability company
|
Prime US-222 Main, LLC, a Delaware limited liability company
|
5.
|
KBSIII 171 17th Street, LLC, a Delaware limited liability company
|
Prime US-171 17th Street, LLC, a Delaware limited liability company
|
6.
|
KBSIII Reston Square, LLC, a Delaware limited liability company
|
Prime US-Reston Square, LLC, a Delaware limited liability company
|
7.
|
KBSIII 101 South Hanley, LLC, a Delaware limited liability company
|
Prime US-101 South Hanley, LLC, a Delaware limited liability company
|
8.
|
KBSIII Village Center Station, LLC, a Delaware limited liability company
|
Prime US-Village Center Station, LLC, a Delaware limited liability company
|
9.
|
Promenade One
KBSIII Promenade One, LLC, a Delaware limited liability company
Promenade Two
KBSIII Promenade Two, LLC, a Delaware limited liability company
|
Prime US-Promenade, LLC, a Delaware limited liability company
|
10.
|
KBSIII CrossPoint At Valley Forge Trust, a Delaware Statutory Trust
|
Prime US-CrossPoint At Valley Forge, LLC, a Delaware limited liability company
|
11.
|
KBSIII Towers At Emeryville, LLC, a Delaware limited liability company
|
Prime US-Tower At Emeryville, LLC, a Delaware limited liability company
|
By:
|
KBSIII VILLAGE CENTER STATION II MEMBER, LLC,
|
By:
|
KBSIII REIT ACQUISITION XXXII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION VI, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION X, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION XIII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION XV, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION XVIII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION XX, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION XXIII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII PROMENADE ONE MEZZ, LLC,
|
By:
|
KBSIII PROMENADE AT EILAN, LLC,
|
By:
|
KBSIII 3003 WASHINGTON MEMBER, LLC,
|
By:
|
KBSIII REIT ACQUISITION XVII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII PROMENADE TWO MEZZ, LLC,
|
By:
|
KBSIII PROMENADE AT EILAN, LLC,
|
By:
|
KBSIII 3003 WASHINGTON MEMBER, LLC,
|
By:
|
KBSIII REIT ACQUISITION XVII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII CROSSPOINT AT VALLEY FORGE, LLC,
|
By:
|
KBSIII REIT ACQUISITION XXVI, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION XXI, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-ACQUISITION I, LLC
|
By:
|
PRIME US PROPERTIES, LLC,
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
The Manager
|
|
|
|
|
|
SIGNED by Sandip Talukdar
|
|
|
/s/ Sandip Talukdar
|
for and on behalf of
|
|
|
|
KBS US PRIME PROPERTY MANAGEMENT PTE. LTD.
|
|
(as manager of Prime US REIT)
|
|
The Trustee
|
|
|
|
|
|
|
|
|
SIGNED by
|
|
|
|
/s/ Kwek Yi Lin
|
/s/ Authorized Signatory
|
for and on behalf of
|
Kwek Yi Lin
|
Authorized Signatory
|
|
|
|
DBS TRUSTEE LIMITED
|
|
|
(as trustee of Prime US REIT)
|
|
|
|
|
|
in the presence of:
|
|
|
/s/ Lee Zhi Kang
|
|
|
Witness' signature
|
|
|
Name: Lee Zhi Kang
|
|
|
Address: 12 Marina Boulevard, Marina Bay
Financial Centre Tower 3, Singapore 018982
|
|
|
|
|
|
|
|
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
SSUB1
|
|
|
|
We hereby confirm our agreement to the foregoing.
|
|
|
|
SIGNED by Sandip Talukdar
|
|
|
/s/ Sandip Talukdar
|
for and on behalf of
|
|
|
|
PRIME US REIT S1 PTE. LTD.
|
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US PROPERTIES, LLC,
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
1.
|
We refer to the set-off agreement (the
"Set-Off Agreement")
dated 27 June 2019 entered into between the parties to this letter. Capitalised terms in this letter which are not otherwise defined herein shall bear the meanings ascribed to them in the Set-Off Agreement.
|
2.
|
We acknowledge and agree that:
|
(a)
|
in relation to recital (K) of the Set-Off Agreement, KBS REIT Properties Ill LLC and its affiliates shall, at no time, own more than 33.3% (instead of 26.0%) of the units in Prime US REIT;
|
(b)
|
in relation to clauses 2.1 and 2.2 of the Set-Off Agreement, the "Relevant Amount", which is the subject of set-off against the purchase consideration under the Sale and Purchase Agreement, shall be US$270,999,519, which is the aggregate amount due from KBS REIT Properties Ill LLC pursuant to the Subscription Agreement and for its subscription of 79,545,000 units in Prime US REIT via the placement tranche; and
|
(c)
|
in relation to clause 2.2 of the Set-Off Agreement, upon receipt by the Vendor of the purchase price (as stated in the Sale and Purchase Agreement) less the Relevant Amount, the Manager (i) shall discharge KBS REIT Properties Ill LLC from, and have no further claim against, KBS REIT Properties Ill LLC in respect of the payment of the subscription amounts due from KBS REIT Properties Ill LLC for the subscription of the units in Prime US REIT under the Subscription Agreement; and (ii) acknowledges and agrees that the payment of the subscription amounts due from KBS REIT Properties Ill LLC for the subscription of the units in Prime US REIT under the placement tranche shall be fully satisfied.
|
3.
|
This letter is governed by, and shall be construed in accordance with, the laws of Singapore, and each party to this letter irrevocably submits to the non-exclusive jurisdiction of the courts of Singapore.
|
4.
|
This letter may be executed in any number of counterparts, each of which, when executed and delivered (whether in original or fax copy), will be an original, but all the counterparts together will constitute one and the same document.
|
5.
|
This letter may only be amended or supplemented in writing signed by or on behalf of each of the parties hereto.
|
6.
|
The provisions of Clause 3.12 of the Set-Off Agreement shall apply, mutatis mutandis, as if expressly incorporated herein.
|
|
SELLER PARTY ("VENDOR")
|
BUYER PARTY ("PURCHASER")
|
1.
|
Village Center Station II Owner, LLC, a
Delaware limited liability company
|
Prime US-Village Center Station II, LLC,
a Delaware limited liability company
|
2.
|
KBSIII Tower at Lake Carolyn, LLC, a
Delaware limited liability company
|
Prime US-Tower At Lake Carolyn, LLC,
a Delaware limited liability company
|
3.
|
KBSIII One Washingtonian, LLC, a
Delaware limited liability company
|
Prime US-One Washingtonian, LLC, a
Delaware limited liability company
|
4.
|
KBSIII 222 Main, LLC, a Delaware
limited liability company
|
Prime US-222 Main, LLC, a Delaware
limited liability company
|
5.
|
KBSIII 171 17th Street, LLC, a Delaware
limited liability company
|
Prime US-17117th Street, LLC, a
Delaware limited liability company
|
6.
|
KBSIII Reston Square, LLC, a
Delaware limited liability company
|
Prime US-Reston Square, LLC, a
Delaware limited liability company
|
7.
|
KBSIII 101 South Hanley, LLC, a
Delaware limited liability company
|
Prime US-101 South Hanley, LLC, a
Delaware limited liability company
|
8.
|
KBSIII Village Center Station, LLC, a
Delaware limited liability company
|
Prime US-Village Center Station, LLC, a
Delaware limited liability company
|
9.
|
Promenade One
KBSIII Promenade One, LLC, a
Delaware limited liability company
Promenade Two
KBSIII Promenade Two, LLC, a
Delaware limited liability company
|
Prime US-Promenade, LLC, a Delaware
limited liability company
|
10.
|
KBSIII CrossPoint At Valley Forge Trust,
a Delaware Statutory Trust
|
Prime US-CrossPoint At Valley Forge,
LLC, a Delaware limited liability company
|
11.
|
KBSIII Towers At Emeryville, LLC, a
Delaware limited liability company
|
Prime US-Tower At Emeryville, LLC, a
Delaware limited liability company
|
By:
|
KBSIII VILLAGE CENTER STATION II MEMBER, LLC,
|
By:
|
KBSIII REIT ACQUISITION XXXII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION VI, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION X, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION XIII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION XV, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION XVIII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION XX, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION XXIII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII PROMENADE ONE MEZZ, LLC,
|
By:
|
KBSIII PROMENADE AT EILAN, LLC,
|
By:
|
KBSIII 3003 WASHINGTON MEMBER, LLC,
|
By:
|
KBSIII REIT ACQUISITION XVII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII PROMENADE TWO MEZZ, LLC,
|
By:
|
KBSIII PROMENADE AT EILAN, LLC,
|
By:
|
KBSIII 3003 WASHINGTON MEMBER, LLC,
|
By:
|
KBSIII REIT ACQUISITION XVII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII CROSSPOINT AT VALLEY FORGE, LLC,
|
By:
|
KBSIII REIT ACQUISITION XXVI, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBSIII REIT ACQUISITION XXI, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-ACQUISITION I, LLC
|
By:
|
PRIME US PROPERTIES, LLC,
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
The Manager
|
|
|
|
We hereby confirm our agreement to the foregoing.
|
|
|
|
SIGNED by Sandip Talukdar
|
|
|
/s/ Sandip Talukdar
|
for and on behalf of
|
|
|
|
KBS US PRIME PROPERTY MANAGEMENT PTE. LTD.
|
|
(as manager of Prime US REIT)
|
|
The Trustee
|
|
|
|
|
|
We hereby confirm our agreement to the foregoing.
|
|
|
|
|
|
SIGNED by
|
|
|
|
/s/ Kwek Yi Lin
|
/s/ Celine Koh
|
for and on behalf of
|
Kwek Yi Lin
|
Celine Koh
|
|
Assistant Manager, Corporate Trust
|
Manager, Corporate Trust
|
DBS TRUSTEE LIMITED
|
DBS Trustee Limited
|
DBS Trustee Limited
|
(as trustee of Prime US REIT)
|
|
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
SSUB1
|
|
|
|
We hereby confirm our agreement to the foregoing.
|
|
|
|
SIGNED by Sandip Talukdar
|
|
|
/s/ Sandip Talukdar
|
for and on behalf of
|
|
|
|
PRIME US REIT S1 PTE. LTD.
|
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PRIME US PROPERTIES, LLC,
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
CLIFFORD
CHANCE
|
|
CLIFFORD CHANCE PTE LTD
|
|
|
EXECUTION VERSION
|
537518-4-8594-v8.0
|
|
17-40684037
|
CONTENTS
|
||||
Clause
|
Page
|
|||
1.
|
Interpretation
|
4
|
|
|
2.
|
Subscription, Purchase and Stablisation
|
18
|
|
|
3.
|
Representations and Warranties
|
25
|
|
|
4.
|
Undertakings by the Manager, the Sponsor and the Unit Lender
|
60
|
|
|
5.
|
Representations, Warranties and Undertakings by the Joint Bookrunners and
Underwriters
|
68
|
|
|
6.
|
Commissions, Costs and Expenses
|
69
|
|
|
7.
|
Closing and Conditions
|
74
|
|
|
8.
|
Termination
|
84
|
|
|
9.
|
Indemnification and Contribution
|
86
|
|
|
10.
|
General
|
92
|
|
|
11.
|
Notices
|
95
|
|
|
12.
|
Law and Jurisdiction
|
98
|
|
|
13.
|
Counterparts
|
99
|
|
|
14.
|
Guarantee
|
99
|
|
|
15.
|
Amendments and Variations
|
102
|
|
|
Schedule 1 The Joint Bookrunners and Underwriters
|
103
|
|
||
Schedule 2 Lock-Up Letters
|
104
|
|
||
Schedule 3 Form of Manager Certificate
|
121
|
|
||
Schedule 4 Form of Sponsor Certificate
|
123
|
|
||
Schedule 5 Form of Unit Lender Certificate
|
125
|
|
||
Schedule 6 Form of Stabilising Manager Appointment Letter
|
127
|
|
||
Schedule 7 Notice of Exercise of Over-allotment Option
|
128
|
|
||
Schedule 8 Form of Title Insurance Policies
|
130
|
|
||
Schedule 9 Form of Confirmation on Marketing Materials
|
131
|
|
537518-4-8594-v8.0
|
|
17-40684037
|
(1)
|
KBS US PRIME PROPERTY MANAGEMENT PTE. LTD.
(Company Registration Number: 201825461R), a company incorporated under the laws of Singapore, whose principal place of business is situated at 1 Raffles Place, #40-01 One Raffles Place, Singapore 048616, in its capacity as manager of Prime US REIT (the "
Manager
");
|
(2)
|
KBS ASIA PARTNERS PTE. LTD.
(Company Registration Number: 201813452D), a company incorporated under the laws of Singapore, whose registered office is at 9 Raffles Place, #26-01 Republic Plaza, Singapore 048619 (the "
Sponsor
");
|
(3)
|
KBS REALTY ADVISORS LLC
, a limited liability company organised under the laws of the State of Delaware, whose registered office is at Registered Agent Solutions, Inc., 9 E Loockerman Street, Suite 311 Dover, DE, Kent County 19901, USA ("
KBS RA
" or the "
US
Asset Manager
");
|
(4)
|
PBREN INVESTMENTS, L.P.
, a limited partnership organised under the laws of the State of Delaware, whose registered office is at Registered Agent Solutions, Inc., 9 E Loockerman Street, Suite 311 Dover, DE, Kent County 19901, USA;
|
(5)
|
SCHREIBER REAL ESTATE INVESTMENTS L.P.
, a limited partnership organised under the laws of the State of Delaware, whose registered office is at Registered Agent Solutions, Inc., 9 E Loockerman Street, Suite 311 Dover, DE, Kent County 19901, USA (together with KBS RA and PBren Investments, L.P., the "
Guarantors
", and each a "
Guarantor
");
|
(6)
|
KBS REIT PROPERTIES III, LLC
, a limited liability company organised under the laws of the State of Delaware, whose registered office is at Registered Agent Solutions, Inc., 9 E Loockerman Street, Suite 311 Dover, DE, Kent County 19901, USA (the "
Unit Lender
");
|
(7)
|
DBS BANK LTD.
(Company Registration Number: 196800306E), a company incorporated under the laws of Singapore, whose registered office is at 12 Marina Boulevard, Marina Bay Financial Centre Tower 3, Singapore 018982 ("
DBS
");
|
(8)
|
MERRILL LYNCH (SINGAPORE) PTE. LTD.
(Company Registration Number: 198602883D), a company incorporated under the laws of Singapore, whose registered office is at 50 Collyer Quay #14-01, OUE Bayfront, Singapore 049321 ("
BAML
", and together with DBS, the "
Joint Global Coordinators
");
|
(9)
|
CHINA INTERNATIONAL CAPITAL CORPORATION (SINGAPORE) PTE. LIMITED
(Company Registration Number: 200814424W), a company incorporated under the laws of Singapore, whose registered office is at 6 Battery Road #33-01, Singapore 049909 ("
CICC
");
|
(10)
|
CREDIT SUISSE (SINGAPORE) LIMITED
(Company Registration Number: 197702363D), a company incorporated under the laws of Singapore, whose registered office is at One Raffles Link #03/#04-01, South Lobby Singapore 039393 ("
CS
");
|
537518-4-8594-v7.4
|
‑
1
‑
|
17-40684037
|
(11)
|
MAYBANK KIM ENG SECURITIES PTE. LTD.
(Company Registration Number: 197201256N), a company incorporated under the laws of Singapore, whose registered office is at 50 North Canal Road #03-01, Singapore 059304 ("
Maybank
"); and
|
(12)
|
OVERSEA-CHINESE BANKING CORPORATION LIMITED
(Company Registration Number: 193200032W), a company incorporated under the laws of Singapore, whose registered office is at 63 Chulia Street #10-00, Singapore 049514 ("
OCBC
").
|
(A)
|
The Manager is the manager of Prime US REIT, a trust constituted pursuant to a trust deed dated 7 September 2018, as amended (the "
Trust Deed
"),
made between the Manager and DBS Trustee Limited, as trustee of Prime US REIT (the "
Trustee
"), and authorised as a collective investment scheme under Section 286 of the Securities and Futures Act, Chapter 289 of Singapore (the "
SFA
").
|
(B)
|
The Manager has the exclusive right to effect, for the account of Prime US REIT, the issue of Units (as defined below) and the Manager proposes to effect, for the account of Prime US REIT, the issue to the Joint Bookrunners and Underwriters or such parties as they may direct, of 335,203,200 Units. The Manager proposes to undertake the Offering (as defined below) in respect of the offering of Units as follows:
|
(i)
|
an international placement of 294,294,200 Units to investors, including institutional and other investors in Singapore (the "
Placement Tranche
");
and
|
(ii)
|
an offering of 40,909,000 Units to the public in Singapore (the "
Public Offer
").
|
(C)
|
In connection with the Offering, the Joint Bookrunners have been granted an over-allotment option (the "
Over-Allotment Option
")
by the Unit Lender, exercisable by Merrill Lynch (Singapore) Pte. Ltd. (the "
Stabilising Manager
")
(or any of its Affiliates (as defined below) or any persons acting on behalf of the Stabilising Manager) in consultation with the Joint Global Coordinators, in full or in part, on one or more occasions, to acquire from the Unit Lender, up to an aggregate of 22,727,000 Units at the Offering Price, representing not more than 6.8% of the total number of Units in the Offering solely to cover the over-allotment of Units (if any) made in connection with the Offering. The Over-Allotment Option is exercisable from the Listing Date but no later than the earliest of: (i)
the date falling 30 days from the Listing Date and (ii) the date when the Stabilising Manager (or any persons acting on behalf of the Stabilising Manager) has bought, on the SGX-ST, an aggregate of 22,727,000 Units (representing not more than 6.8% of the total number of Units in the Offering) to undertake stabilising actions, to acquire from the Unit Lender up to an aggregate of 22,727,000 Units (representing not more than 6.8% of the total number of Units in the Offering), at the Offering Price.
|
(D)
|
In connection with the Over-Allotment Option, the Stabilising Manager and the Unit Lender have entered into a unit lending agreement dated 15 July 2019 (the "
Unit Lending Agreement
")
pursuant to which the Stabilising Manager (or any of its
|
537518-4-8594-v7.4
|
‑
2
‑
|
17-40684037
|
(E)
|
Concurrently with, but separate from the Offering, each of the Cornerstone Investors (as defined herein) has entered into a separate subscription agreement (collectively, the "
Cornerstone Subscription Agreements
") to subscribe for an aggregate of 360,251,800 Units (the "
Cornerstone Units
") at the Offering Price, conditional upon the Singapore Offer Agreement and the Placement Agreement having been entered into, and not having been terminated, pursuant to its terms on or prior to the Listing Date.
|
(F)
|
Concurrently with, but separate from the Offering, KBS REIT Properties III, LLC, ("
KBS REIT Properties III
") which is an indirect wholly-owned subsidiary of KBS Real Estate Investment Trust III, Inc., has entered into a subscription agreement dated 27 June 2019, which was amended and supplemented by a side letter dated 15 July 2019 (the "
KBS Subscription Agreement
")
to subscribe for an aggregate of 228,408,999 Units (the "
KBS Units
") at the Offering Price, conditional upon the Singapore Offer Agreement and the Placement Agreement having been entered into, and not having been terminated, pursuant to its terms on or prior to the Listing Date.
|
(G)
|
The Units will be offered and sold without being registered under the Securities Act (as defined below), in reliance upon an exemption from the registration requirements of the Securities Act. Accordingly, the Units will be offered and sold only outside the United States in an offshore transaction in reliance on Regulation S (as defined below) of the Securities Act, provided that the Units offered and sold to KBS REIT Properties III and the US Trusts (including any Units offered and sold to them as part of the Placement Tranche) will be offered and sold pursuant to Section 4(a)(2) of the Securities Act.
|
(H)
|
In connection with the offering and sale of Units pursuant to the Public Offer (as defined above) and the Placement Tranche, the Manager has prepared a preliminary prospectus dated 28 June 2019 (as further amended or supplemented at the date hereof, including any and all appendices and exhibits thereto, the "
Preliminary Prospectus
"), and a final prospectus dated 8 July 2019 (including the Application Forms (as defined below) to be issued therewith, any and all appendices and exhibits thereto, the "
Prospectus
"). The Preliminary Prospectus has been lodged with the MAS (as defined herein) on 28 June 2019, and the Prospectus was registered by the MAS on 8 July 2019.
|
(I)
|
A conditional letter of eligibility has been issued by Singapore Exchange Securities Trading Limited (the "
SGX-ST
") on 11 February 2019, the validity of which was extended by a letter from the SGX-ST dated 7 May 2019 (the "
ETL Letter
") for the listing and quotation of the Units on the Main Board of the SGX-ST and the admission of the Units to the Official List of the SGX-ST (the "
Listing
") and the Units to be issued to the Manager in full or part payment of the Manager's fees.
|
(J)
|
The Manager wishes to appoint DBS Bank Ltd. as receiving bank in connection with the Offering on the terms and conditions set out in this Agreement.
|
(K)
|
In consideration of the entry by the Joint Bookrunners and Underwriters into this Agreement, the sufficiency of which is acknowledged, each of the Guarantors agrees to irrevocably and unconditionally guarantee to each of the Joint Bookrunners and
|
537518-4-8594-v7.4
|
‑
3
‑
|
17-40684037
|
1.
|
INTERPRETATION
|
1.1
|
Definitions
|
537518-4-8594-v7.4
|
‑
4
‑
|
17-40684037
|
537518-4-8594-v7.4
|
‑
5
‑
|
17-40684037
|
(a)
|
land, including, without limitation, surface land, sub-surface strata, sea bed and river bed under water (as defined in paragraph (b)) and natural and man-made structures;
|
(b)
|
water, including, without limitation, coastal and inland waters, surface waters, ground waters and water in drains and sewers; and
|
(c)
|
air, including, without limitation, air inside buildings and other natural and man- made structures above or below ground.
|
(a)
|
public and worker's health and safety;
|
(b)
|
noise, vibration or radiation;
|
(c)
|
the release or discharge of industrial, radioactive, dangerous, toxic or hazardous substances, waste (whether in solid, semi-solid or liquid form or in the form of a gas or vapour) and genetically modified organisms into the Environment; or
|
(d)
|
the generation, manufacture, processing, use, treatment, storage, distribution, disposal, transport or handling of any of the substances, waste and organisms referred to in paragraph (c).
|
537518-4-8594-v7.4
|
‑
6
‑
|
17-40684037
|
(a)
|
a statement containing a projection of revenues, income (including income loss), earnings (including earnings loss) per unit, capital expenditures, distributions, capital structure, or other financial items, in each case, of Prime US REIT, the Trust Group Entities or the Properties;
|
(b)
|
a statement of the plans and objectives of management for future operations, including plans or objectives relating to the business of Prime US REIT, the Trust Group Entities or the Properties;
|
(c)
|
a statement of future economic performance of Prime US REIT, the Trust Group Entities or the Properties, including any such statement contained in a discussion and analysis of financial condition by the management or in the results of operations; or
|
(d)
|
any statement of the assumptions underlying or relating to any statement described in paragraphs (a), (b) or (c).
|
537518-4-8594-v7.4
|
‑
7
‑
|
17-40684037
|
(a)
|
in relation to Tower I at Emeryville, a leasing services agreement will be entered into between Cushman & Wakefield of California, Inc., a California corporation, and Prime US-Tower at Emeryville, LLC, a Delaware limited liability company;
|
(b)
|
in relation to 222 Main, a leasing services agreement will be entered into between CBRE, Inc., a Delaware corporation, and Prime US-222 Main, LLC, a Delaware limited liability company;
|
(c)
|
in relation to Village Center Station I, a leasing services agreement for retail transactions will be entered into between David, Hicks & Lampert Brokerage, LLC, a Colorado limited liability company, and Prime US-Village Center Station, LLC, a Delaware limited liability company;
|
(d)
|
in relation to Village Center Station I, a leasing services agreement for office transactions will be entered into between Cushman & Wakefield of Colorado, Inc., a Colorado corporation, and Prime US-Village Center Station, LLC, a Delaware limited liability company;
|
(e)
|
in relation to Village Center Station II, there is no leasing services agreement;
|
537518-4-8594-v7.4
|
‑
8
‑
|
17-40684037
|
(f)
|
in relation to 101 South Hanley, a leasing services agreement will be entered into between CBRE, Inc., a Delaware corporation and Prime US-101 South Hanley, LLC, a Delaware limited liability company;
|
(g)
|
in relation to Tower 909, a leasing services agreement will be entered into between TSC Central Region, GP, LLC, a Delaware limited liability company, dba Transwestern, and Prime US-Tower at Lake Carolyn, LLC, a Delaware limited liability company;
|
(h)
|
in relation to Promenade I, a leasing services agreement will be entered into between CBRE, Inc., a Delaware corporation, and Prime US-Promenade, LLC, a Delaware limited liability company;
|
(i)
|
in relation to Promenade II, a leasing services agreement will be entered into between CBRE, Inc., a Delaware corporation, and Prime US-Promenade, LLC, a Delaware limited liability company;
|
(j)
|
in relation to CrossPoint, a leasing services agreement will be entered into between CBRE, Inc., a Delaware corporation, and Prime US-CrossPoint at Valley Forge, LLC, a Delaware limited liability company;
|
(k)
|
in relation to One Washingtonian Center, a leasing services agreement will be entered into between CBRE, Inc., a Delaware corporation, and Prime US-One Washingtonian, LLC, a Delaware limited liability company;
|
(l)
|
in relation to Reston Square, a leasing services agreement will be entered into between Avison Young – Washington, D.C. LLC, a Maryland limited liability company, and Prime US-Reston Square, LLC, a Delaware limited liability company; and
|
(m)
|
in relation to 171 17th Street, a leasing services agreement will be entered into between Cushman & Wakefield U.S., Inc., a Missouri corporation, and Prime US-171 17
th
Street, LLC, a Delaware limited liability company.
|
537518-4-8594-v7.4
|
‑
9
‑
|
17-40684037
|
(a)
|
the roadshow presentation materials (including without limitation, slides, scripts and corporate videos) for any roadshow or other investor presentations, whether in relation to the Offering or otherwise and approved by the Manager;
|
(b)
|
the script for any call centres established in connection with the offering and sale of Offering Units pursuant to the Public Offer and the Placement Tranche (if any);
|
(c)
|
the advertising and publicity materials in relation to the offering and sale of Offering Units pursuant to the Public Offer and the Placement Tranche, such as signboards, posters, press, brochures, radio or television materials;
|
(d)
|
the contents of any website set up by the Manager relating to the offering and sale of Offering Units pursuant to the Public Offer and the Placement Tranche (if any);
|
(e)
|
any press release relating to the Offering;
|
(f)
|
the product highlights sheets accompanying each of the Preliminary Prospectus and Prospectus;
|
(g)
|
all alterations or amendments, in the case of materials referred to in paragraphs (a) to (f) above, as approved by the Manager on or before the date hereof; and
|
(h)
|
any other marketing materials (including any alterations or amendments to any of the materials referred to in paragraphs (a) to (g) above) as may be, approved by the Manager after the date hereof, distributed or communicated by or on behalf of the Manager to third parties in relation to the offering and sale of Offering Units pursuant to the Public Offer and the Placement Tranche, and which for the avoidance of doubt does not include pre-deal research reports produced by the Joint Bookrunners and Underwriters.
|
537518-4-8594-v7.4
|
‑
10
‑
|
17-40684037
|
537518-4-8594-v7.4
|
‑
11
‑
|
17-40684037
|
(a)
|
in relation to Tower I at Emeryville, a property management agreement will be entered into between Cushman & Wakefield U.S., Inc., a Missouri corporation, and Prime US-Tower at Emeryville, LLC, a Delaware limited liability company;
|
(b)
|
in relation to 222 Main, a property management agreement will be entered into between HP Utah Management LLC, a Delaware limited liability company, and Prime US-222 Main, LLC, a Delaware limited liability company;
|
(c)
|
in relation to Village Center Station I, a property management agreement will be entered into between Jones Lang LaSalle Americas, Inc., a Maryland corporation, and Prime US-Village Center Station, LLC, a Delaware limited liability company;
|
(d)
|
in relation to Village Center Station II, a property management agreement will be entered into between Shea Properties Management Company, Inc., a Delaware corporation, and Prime US-Village Center Station II, LLC, a Delaware limited liability company;
|
(e)
|
in relation to 101 South Hanley, a property management agreement will be entered into between CBRE, Inc., a Delaware corporation and Prime US-101 South Hanley, LLC, a Delaware limited liability company;
|
(f)
|
in relation to Tower 909, a property management agreement will be entered into between
|
537518-4-8594-v7.4
|
‑
12
‑
|
17-40684037
|
(g)
|
in relation to Promenade I, a property management agreement will be entered into between CBRE, Inc., a Delaware corporation, and Prime US-Promenade, LLC, a Delaware limited liability company;
|
(h)
|
in relation to Promenade II, a property management agreement will be entered into between CBRE, Inc., a Delaware corporation, and Prime US-Promenade, LLC, a Delaware limited liability company;
|
(i)
|
in relation to CrossPoint, a property management agreement will be entered into between CBRE, Inc., a Delaware corporation, and Prime US-CrossPoint at Valley Forge, LLC, a Delaware limited liability company;
|
(j)
|
in relation to One Washingtonian Center, a property management agreement will be entered into between Transwestern Carey Winston, L.L.C., a Delaware limited liability company, dba Transwestern, and Prime US-One Washingtonian, LLC, a Delaware limited liability company;
|
(k)
|
in relation to Reston Square, a property management agreement will be entered into between Transwestern Carey Winston, L.L.C., a Delaware limited liability company, dba Transwestern, and Prime US-Reston Square, LLC, a Delaware limited liability company; and
|
(l)
|
in relation to 171 17
th
Street, a property management agreement will be entered into between Cushman & Wakefield U.S., Inc., a Missouri corporation, and Prime US-171 17
th
Street, LLC, a Delaware limited liability company; and
|
537518-4-8594-v7.4
|
‑
13
‑
|
17-40684037
|
537518-4-8594-v7.4
|
‑
14
‑
|
17-40684037
|
537518-4-8594-v7.4
|
‑
15
‑
|
17-40684037
|
(a)
|
Village Center Station II Owner, LLC;
|
(b)
|
KBSIII Tower at Lake Carolyn, LLC;
|
(c)
|
KBSIII One Washingtonian, LLC;
|
(d)
|
KBSIII 222 Main, LLC;
|
(e)
|
KBSIII 171 17
th
Street, LLC;
|
(f)
|
KBSIII Reston Square, LLC;
|
(g)
|
KBSIII 101 South Hanley, LLC;
|
(h)
|
KBSIII Village Center Station, LLC;
|
(i)
|
KBSIII Promenade One, LLC;
|
(j)
|
KBSIII Promenade Two, LLC;
|
(k)
|
KBSIII CrossPoint At Valley Forge Trust, LLC; and
|
(l)
|
KBSIII Towers at Emeryville, LLC.
|
537518-4-8594-v7.4
|
‑
16
‑
|
17-40684037
|
1.2
|
Interpretation
|
1.1.1
|
A "
person
" refers to any individual, company, corporation, firm, partnership, joint venture, association, organisation, state or agency of a state or other entity, whether or not having separate legal personality;
|
1.1.2
|
"
S$
" and "
Singapore dollars
" denote the lawful currency for the time being of Singapore;
|
1.1.3
|
"
US$
" and "
United States dollars
" denote the lawful currency for the time being of the United States; and
|
1.1.4
|
times of day and dates are to Singapore times and dates unless otherwise stated.
|
1.3
|
Modification etc. of Statutes
|
1.1.5
|
that statute or provision as from time to time modified, re-enacted or consolidated whether before or after the date of this Agreement;
|
1.1.6
|
any past statute or statutory provision (as from time to time modified, re-enacted or consolidated) which that statute or provision has directly or indirectly replaced; and
|
1.1.7
|
any subordinate legislation made from time to time under that statute or statutory provision.
|
1.4
|
Clauses, recitals and schedules
|
1.5
|
Singular, plural, gender
|
1.6
|
Rounding
|
537518-4-8594-v7.4
|
‑
17
‑
|
17-40684037
|
1.7
|
Headings
|
1.8
|
Legislation
|
1.9
|
Several liabilities and rights
|
1.10
|
Capacity of the Manager
|
1.11
|
Agreed Form
|
2.
|
SUBSCRIPTION, PURCHASE AND STABILISATION
|
2.1
|
Subscription for Units
|
537518-4-8594-v7.4
|
‑
18
‑
|
17-40684037
|
2.1.1
|
If a Joint Bookrunner and Underwriter defaults in the performance of its obligations on the First Closing Date to procure subscribers or subscribe for, the Underwritten Units which it has agreed to procure subscribers or subscribe for under this Agreement (such Underwritten Units in respect of which the Joint Bookrunner and Underwriter has defaulted in the performance of its obligations being called the "
Defaulted Underwritten Units
"),
the non-defaulting Joint Bookrunners and Underwriter shall have the right, but not the obligation, within 24 hours thereafter, to make arrangements to subscribe, or to procure subscribers for, all, but not less than all, of the Defaulted Underwritten Units. If, however, the non-defaulting Joint Bookrunners and Underwriters shall not have completed such arrangements within such 24-hour period, then this Agreement shall terminate without liability to the non-defaulting Joint Bookrunners and Underwriters. Nothing herein shall relieve a defaulting Joint Bookrunner and Underwriter from liability for its default. For the avoidance of doubt, the underwriting and selling commissions payable to the non-defaulting Joint Bookrunners and Underwriters which have subscribed for, or have procured to subscribe for the Defaulted Underwritten Units shall be correspondingly increased to include the underwriting and selling commission originally payable to the defaulting Joint Bookrunner and Underwriter for the sale and placement of the Defaulted Units in accordance with the proportion of the Defaulted Underwritten Units subscribed, or subscription of which is procured, by the relevant non-defaulting Joint Bookrunners and Underwriters.
|
2.1.2
|
Payment of the Offering Price for, and delivery of, the Underwritten Units shall take place in accordance with Clause 7.
|
2.1.3
|
The parties agree that if after the First Closing Date the Units are not listed on the SGX-ST by 2.00 p.m. (Singapore time) on 19 July 2019 for any reason, including by reason of a stop order being issued by the MAS, any of the Joint Bookrunners and Underwriters shall be entitled to require the Manager and the Trustee to return the Offering Proceeds and proceeds of the Cornerstone Units to investors subscribing for Units in the Offering or, as the case may be, the Cornerstone Investors, as soon as practicably possible (for subscriptions made via automated teller machines, within 24 hours) following the Joint Bookrunners and Underwriters becoming aware that the Listing and/or trading in the Units will not proceed, and otherwise in accordance with all applicable laws, rules or directives of any governmental or regulatory agency. The parties further agree that to the extent that upon such failure to list and/or trade the Units on the SGX ST, any Units are not deemed to have been cancelled by operation of law, that they will reasonably cooperate, including by taking actions as may be necessary with CDP, to return such Units to the Manager and the Trustee for cancellation.
|
2.2
|
Offering Price
|
537518-4-8594-v7.4
|
‑
19
‑
|
17-40684037
|
2.3
|
Over-Allotment Option
|
2.3.1
|
Subject to and in accordance with the provisions of this Agreement, the Joint Bookrunners and Underwriters are hereby granted an Over-Allotment Option by the Unit Lender, exercisable by the Stabilising Manager (or any of its Affiliates or other persons acting on behalf of the Stabilising Manager) in consultation with the Joint Bookrunners and Underwriters, in full or in part, on one or more occasions, to acquire from the Unit Lender up to an aggregate of 22,727,000 Units at the Offering Price, representing not more than 6.8% of the total number of Units in the Offering solely to cover the over allotment of Units (if any) made in connection with the Offering.
|
2.3.2
|
If a Joint Bookrunner and Underwriter defaults in the performance of its obligations on an Option Closing Date to purchase, or procure purchasers for, the Over-Allotment Units which it has agreed to purchase, or procure purchasers for, under this Agreement (such Over-Allotment Units in respect of which the Joint Bookrunner and Underwriter has defaulted in the performance of its obligations being called the "
Defaulted Over-Allotment Units
"), the non-defaulting Joint Bookrunners and Underwriters shall have the right, but not the obligation, within 24 hours thereafter, to make arrangements to purchase, or to procure purchasers for, all, but not less than all, of the Defaulted Over-Allotment Units. If, however, the non-defaulting Joint Bookrunners and Underwriters shall not have completed such arrangements within such 24-hour period, then the non-defaulting Joint Bookrunner and Underwriter may terminate their obligations to purchase the Defaulted Over-Allotment Units without liability to the non-defaulting Joint Bookrunners and Underwriters. Nothing herein shall relieve a defaulting Joint Bookrunner and Underwriter from liability for its default.
|
2.3.3
|
In the event and to the extent that the Over-Allotment Option is exercised, the Unit Lender agrees to sell to the Stabilising Manager, as agent of the Joint Bookrunners and
|
537518-4-8594-v7.4
|
‑
20
‑
|
17-40684037
|
2.3.4
|
The Unit Lender shall on each Option Closing Date, deliver such number of Over-Allotment Units equal to the number of Over-Allotment Units specified in the notice of exercise of the Over-Allotment Option against the payment for the Over-Allotment Units in accordance with Clause 7.2 of this Agreement. The obligation of the Stabilising Manager to re-deliver the Over-Allotment Units under the Unit Lending Agreement shall be deemed to have been discharged to the extent of the number of Over-Allotment Units in respect of which the Over-allotment Option has been exercised by the Stabilisation Manager and payment of which has been made to the Unit Lender.
|
2.3.5
|
Any notice of exercise may only be given on a Business Day and if given later than 5:00 p.m. on any Business Day shall be deemed to have been given on the immediately following Business Day.
|
2.4
|
Price Stabilisation
|
2.4.1
|
In connection with the Offering, the Stabilising Manager (or any of its Affiliates or other persons acting on behalf of the Stabilising Manager) may, in consultation with the Joint Bookrunners and Underwriters and at its discretion, to the extent permissible by applicable laws and regulations and in compliance therewith, as principal and not as agent of the Manager, over-allot or effect transactions which stabilise or maintain the market price of the Units at levels that might not otherwise prevail in the open market. However, there is no assurance that the Stabilising Manager (or any of its Affiliates or other persons acting on behalf of the Stabilising Manager) will undertake stabilising action.
|
2.4.2
|
Such transactions may commence on or after the date of commencement of trading in the Units on the SGX-ST and, if commenced, may be discontinued at any time and shall not be effected after the earlier of (i) the date falling 30 days from the Listing Date and (ii) the date when the Stabilising Manager (or any of its Affiliates or other persons acting on behalf of the Stabilising Manager) has bought on the SGX-ST an aggregate of 22,727,000 Units (representing not more than 6.8% of the total number of Units in the Offering) to undertake stabilising actions (the "
Stabilisation Period
"). The Stabilising Manager undertakes that stabilisation will be conducted in compliance with the Securities and Futures (Market Conduct) (Exemptions) Regulations 2006 (the "
Stabilisation Regulations
"),
provided that each of the Manager, the Sponsor and the Unit Lender complies with the undertaking in 4.11.2 below. Each of the Manager, the Sponsor and the Unit Lender undertakes that it will not directly or indirectly, effect or cause to be effected any sell orders during the Stabilisation Period as may be prohibited under the Stabilisation Regulations.
|
2.4.3
|
Subject to compliance with the Stabilisation Regulations, the Stabilising Manager may appoint an agent to carry out stabilisation on its behalf. Any loss
|
537518-4-8594-v7.4
|
‑
21
‑
|
17-40684037
|
2.5
|
Appointment
|
2.6
|
Authorisation
|
2.7
|
Sub-underwriters
|
2.8
|
Allocation to subscribers
|
537518-4-8594-v7.4
|
‑
22
‑
|
17-40684037
|
2.9
|
Allocation between Public Offer and Placement Tranche
|
2.9.1
|
any Offering Units offered under the Public Offer not applied for shall be allocated to satisfy applications for Offering Units offered under the Placement Tranche, to the extent there is an over-subscription for the Placement Tranche at the Offering Price, subject to and on the terms and conditions of the Prospectus applicable to applications for Offering Units under the Placement Tranche; and
|
2.9.2
|
any Offering Units offered under the Placement Tranche not applied for shall be allocated to satisfy excess applications for Offering Units offered under the Public Offer, subject to and on the terms and conditions of the Prospectus applicable to applications for Offering Units under the Public Offer.
|
2.10
|
Balloting
|
2.11
|
Distribution of Prospectus and Announcements
|
537518-4-8594-v7.4
|
‑
23
‑
|
17-40684037
|
2.12
|
Appointment and Duties of Receiving Bank
|
2.12.1
|
The Manager hereby confirms the appointment of DBS Bank Ltd. as receiving bank in connection with the Offering.
|
2.12.2
|
The proceeds of the Offering (including any excess application monies) pursuant to the offer of the Offering Units shall, after payments of all amounts due to the Joint Bookrunners and Underwriters under the Repayment Side Letter, be deposited with DBS Bank Ltd. as the Receiving Bank and be held in a separate non-interest bearing account opened by the Manager and operated by the Receiving Bank and designated as the "PRIME USD Unit Issue Account" solely for the purpose of depositing such proceeds. The Receiving Bank is hereby authorised to operate such account in accordance with the provisions of this Agreement, the terms of the Receiving Bank Agreement, the rules and directives of the SGX-ST for the time being applicable relating to the operation of such account and all other applicable laws, regulations and directives (including without limitation, the SFA).
|
2.12.3
|
The Manager hereby irrevocably authorises the Receiving Bank to return the application monies for the Units on its behalf to the applicants free of interest, share of profits or other benefit arising therefrom in the following situations:
|
(a)
|
in the event that a supplementary prospectus or replacement prospectus is registered pursuant to Section 298 of the SFA and the applicant exercises its right to a refund of the application monies;
|
(b)
|
in the event that a stop order is issued by the MAS in accordance with Section 297 of the SFA; or
|
(c)
|
if for any reason whatsoever, the Units are not admitted to the Official List of the SGX-ST.
|
2.12.4
|
Payment of the proceeds to the Manager shall be made in United States Dollars.
|
2.12.5
|
The Joint Bookrunners and Underwriters shall not be in any way responsible for the obligations of the Trustee and the Manager under Sections 258, 297 and 301 of the SFA.
|
537518-4-8594-v7.4
|
‑
24
‑
|
17-40684037
|
3.
|
REPRESENTATIONS AND WARRANTIES
|
3.1
|
Representations and warranties of the Manager
|
3.1.1
|
Organisation of the Manager, the Manager US Sub and Prime US REIT
|
(a)
|
The Manager has been duly organised and is validly existing as a limited liability company under the laws of Singapore with full power and authority to conduct its business as described in the Preliminary Prospectus and the Prospectus and is duly qualified to do business in, and is in good standing (if
applicable) under the laws of each jurisdiction that its business is currently operated in, or is contemplated;
|
(b)
|
The Manager US Sub is wholly-owned by the Manager and has been duly organised and is validly existing as a limited liability company under the laws of the State of Delaware, with full power and authority to conduct its business as described in the Preliminary Prospectus and the Prospectus and own or lease, as the case may be, and to operate its assets and properties and has obtained all approvals, licenses, authorisations and consents required to conduct the activities as delegated to it by the Manager in respect of those activities that are required to be performed in the U.S., and has elected to be treated as an association taxable as a corporation under the U.S Tax Code and is duly qualified to do business in, and is in good standing (if applicable) under the laws of each jurisdiction that its business is currently operated in, or is contemplated;
|
(c)
|
The Manager has been granted the CMS Licence, which is in full force and effect and which has not been amended or revoked, there has been no breach of the terms and conditions applicable to the CMS Licence, and all such terms and conditions to the extent that they are required to be complied with prior to the date hereof, have been complied with;
|
(d)
|
Prime US REIT has been duly constituted and is validly existing as a unit trust under the laws of Singapore (including the Property Funds Appendix) with full power and authority to own or lease, as the case may be, and to operate its assets and properties (including, without limitation, the Trust Group Entities and upon completion of the Acquisitions, the Properties) and to conduct its business as described in the Preliminary Prospectus and the Prospectus, and does not have any assets or conduct any business apart from what is described in the Preliminary Prospectus and the Prospectus; and
|
(e)
|
Save for the Manager US Sub, the Trust Group Entities and the dormant Barbados entities, neither the Manager nor Prime US REIT respectively have any subsidiaries, associated companies, and/or interest in any joint
|
537518-4-8594-v7.4
|
‑
25
‑
|
17-40684037
|
3.1.2
|
Organisation of Trust Group Entities
|
3.1.3
|
Ownership structure of Prime US REIT
|
(a)
|
all outstanding voting shares of each of the Singapore Subsidiaries have been or, as the case may be, will be when issued on the First Closing Date, duly authorised and validly issued and fully paid, and owned directly by the Trustee (on behalf of Prime US REIT);
|
(b)
|
all outstanding shares of voting common stock of the Parent US REIT have been or, as the case may be, will be when issued on the First Closing Date, duly authorised and validly issued and fully paid, and owned directly by Singapore Sub 1;
|
(c)
|
all outstanding voting units of ownership interest of the Upper-Tier US LLC have been or, as the case may be, will be when issued on the First Closing Date, duly authorised and validly issued and fully paid, and owned directly by the Parent US REIT;
|
(d)
|
all outstanding voting units of ownership interest of the Mid-Tier US LLC have been or, as the case may be, will be when issued on the First Closing Date, duly authorised and validly issued and fully paid, and owned directly by the Upper-Tier US LLC;
|
(e)
|
all outstanding voting units of ownership interest of the Lower-Tier US LLC have been or, as the case may be, will be when issued on the First Closing Date, duly authorised and validly issued and fully paid, and owned directly by the Mid-Tier US LLC; and
|
537518-4-8594-v7.4
|
‑
26
‑
|
17-40684037
|
(f)
|
all outstanding voting units of ownership interest of each of the Property-Tier US LLCs (except for Prime US-222 Main, LLC) have been or, as the case may be, will be when issued on the First Closing Date, duly authorised and validly issued and fully paid, and owned directly by the Lower-Tier US LLC;
|
(g)
|
all outstanding voting units of ownership interest of Prime US Properties, LLC have been or, as the case may be, will be when issued on the First Closing Date, duly authorised and validly issued and fully paid, and owned directly by the Mid-Tier US LLC;
|
(h)
|
all outstanding voting units of ownership interest of Prime US-Acquisition I, LLC have been or, as the case may be, will be when issued on the First Closing Date, duly authorised and validly issued and fully paid, and owned directly by Prime US Properties, LLC; and
|
(i)
|
all outstanding voting units of ownership interest of Prime US-222 Main, LLC have been or, as the case may be, will be when issued on the First Closing Date, duly authorised and validly issued and fully paid, and owned directly by Prime US-Acquisition I, LLC,
|
3.1.4
|
Trust Deed
|
3.1.5
|
Transaction Documents
|
537518-4-8594-v7.4
|
‑
27
‑
|
17-40684037
|
3.1.6
|
The Property Managers and Leasing Agents
|
3.1.7
|
No conflicts
|
(a)
|
the Constitution, bylaws, trust deeds or other constitutive documents of the Manager, the Manager US Sub, Prime US REIT or any of the Trust Group Entities;
|
(b)
|
the terms of any Document to which the Manager, the Manager US Sub, Prime US REIT or any of the Trust Group Entities is a party or bound or to which their assets or properties are subject (including, without limitation, the Trust Deed); or
|
(c)
|
any statute, law, rule, regulation, judgment, order or decree (including, without limitation, the Listing Rules, the SFA, the CIS Regulations and the Code (including the Property Funds Appendix)) applicable to the Manager, the Manager US Sub, Prime US REIT and/or any of the Trust Group Entities of any court, regulatory body, administrative agency, governmental body, arbitrator or other authority having jurisdiction over the Manager, the Manager US Sub, Prime US REIT and/or any of the Trust Group Entities, or any of their respective assets and properties (including without limitation, the Properties), as applicable,
|
537518-4-8594-v7.4
|
‑
28
‑
|
17-40684037
|
3.1.8
|
No consents required
|
(a)
|
such as have been obtained and disclosed in the Preliminary Prospectus and the Prospectus; and
|
(b)
|
the registration of the Prospectus with the MAS,
|
3.1.9
|
Capitalisation of Prime US REIT
|
(a)
|
The structure of Prime US REIT (including the holding structure of each of the Trust Group Entities and the holding structure of the Properties), and Prime US REIT's authorised and outstanding Units, in each case as of the Listing Date, are as set forth in the Preliminary Prospectus and the Prospectus (and each of such Units is or will be fully paid at such time);
|
(b)
|
The Offering Units, the Cornerstone Units, the Initial Unit and the KBS Units (which includes the Over-Allotment Units) have been duly and validly authorised and, when issued and delivered to and paid for by the Joint Bookrunners and Underwriters pursuant to this Agreement, the Singapore Offer Agreement, the Cornerstone Subscription Agreements,
|
537518-4-8594-v7.4
|
‑
29
‑
|
17-40684037
|
(c)
|
The Units (including the Cornerstone Units, the Offering Units, the Initial Unit and the KBS Units (which includes the Over-Allotment Units)) will be validly issued fully paid and free from all Encumbrances, and will be freely transferable (subject to the Lock-Up Letters and save as provided in the Trust Deed and/or as disclosed in the Preliminary Prospectus and the Prospectus). All such Units will, upon issue, rank
pari passu
in all respects with each other and with the existing Units in issue. The holders of Units already in issue at the time of issue of such Units will not be entitled to, or will have duly and irrevocably waived, any pre-emptive or any other rights with respect to the acquisition, issuance and sale of those Units;
|
(d)
|
Other than pursuant to this Agreement, the Singapore Offer Agreement, the Cornerstone Subscription Agreements, the Unit Lending Agreement and the KBS Subscription Agreement, or as described in the Preliminary Prospectus and the Prospectus, no options, warrants or other rights to purchase, agreements or other obligations to issue, or rights to convert any obligations into or exchange any securities for Units or other ownership interests in Prime US REIT or any of the Trust Group Entities to which the Manager, the Manager US Sub, Prime US REIT or any of the Trust Group Entities is a party are outstanding;
|
(e)
|
The statements set forth in the Preliminary Prospectus and the Prospectus under the section titled "The Formation and Structure of Prime US REIT", insofar as they purport to constitute a summary of the terms of the Trust Deed and the Units, fairly and accurately summarise the matters therein described; and
|
(f)
|
other than pursuant to lock-up undertakings which are or will be given in favour of the Joint Bookrunners and Underwriters (including the Lock-Up Letters) and save as provided in the Trust Deed and/or as disclosed in the Preliminary Prospectus and the Prospectus, there are no restrictions (whether under the laws of Singapore or otherwise) on subsequent transfers of Units subscribed for or purchased under the Offering;
|
3.1.10
|
No Violation
|
537518-4-8594-v7.4
|
‑
30
‑
|
17-40684037
|
(a)
|
any provision of its Constitution, memorandum and articles of association or trust deeds or other constitutive documents, as the case may be;
|
(b)
|
any Document to which it is a party or bound or to which its assets or properties (including, without limitation, the Properties) is subject (including, without limitation, the Trust Deed); or
|
(c)
|
any statute, law, rule, regulation, judgment, order or decree of any court, regulatory body, administrative agency, governmental body, arbitrator or other authority having jurisdiction over it or any of their assets or properties (including, without limitation, the Properties), as applicable,
|
3.1.11
|
No proceedings
|
3.1.12
|
No cessation or insolvency
|
3.1.13
|
No immunity
|
537518-4-8594-v7.4
|
‑
31
‑
|
17-40684037
|
3.1.14
|
No Stabilisation
|
3.1.15
|
Ownership of Properties
|
(a)
|
Upon completion of the Acquisitions on the Completion Date, each of the Property-Tier US LLCs will have marketable fee simple title to the relevant Properties as described in the Preliminary Prospectus and the Prospectus as set forth in the Proforma Title Insurance Policies. Except for the Title Insurance Exceptions, the Manager is not aware of any Encumbrances or other title matters relating to the Properties which will adversely affect the relevant Property-Tier US LLCs' title to the relevant Properties upon such completion of the Acquisitions.
|
(b)
|
Upon completion of the Acquisitions on the Completion Date, except for the Title Insurance Exceptions or as otherwise described in the Preliminary Prospectus and the Prospectus or as otherwise would not individually or in the aggregate have a Material Adverse Effect, the Property-Tier US LLCs:
|
(i)
|
will have marketable title to all other assets and properties to be owned by them in connection with the ownership and operation of the Properties, in each case, free and clear of all Encumbrances of any kind;
|
(ii)
|
will have obtained all necessary governmental, regulatory and other approvals and/or consents which may be required in connection with the acquisition, lease, sub-lease, licence,
|
537518-4-8594-v7.4
|
‑
32
‑
|
17-40684037
|
(iii)
|
will be entitled as legal and beneficial owners of the Properties to all rights and benefits as landlord, lessor or licensor under the tenancies, leases or licences to which it will be a party as landlord or licensor in respect of the Properties, and such tenancies, leases or licences are in full force and effect.
|
(c)
|
Upon completion of the Acquisitions on the Completion Date, except as described in the Preliminary Prospectus and the Prospectus or as otherwise would not individually or in the aggregate have a Material Adverse Effect, none of the Property-Tier US LLCs:
|
(i)
|
is or will be, and as far as the Manager is aware, none of the Vendors or any other person are or will be, in breach under any of such leases, tenancies or licences at the Properties (and the Manager does not know of any event which, but for the passage of time or the giving of notice, or both, would constitute a breach under any of such leases, tenancies or licences);
|
(ii)
|
have received notice of any cause of action that has been asserted by anyone adverse to the rights of the Property-Tier US LLCs under any of the leases, tenancies or licences mentioned above, or affecting or challenging their respective rights to the continued possession of the leased, tenanted or licensed premises under any such lease, tenancies or licences; and
|
(iii)
|
have received notice of any cause of action that has been asserted by any governmental entity that the Property-Tier US LLCs or the Properties are subject to any threatened or pending real property tax assessment or condemnation or eminent domain proceeding;
|
(d)
|
Save for the Properties, none of the Manager, the Manager US Sub, Prime US REIT or any of the Trust Group Entities will, on the Listing Date, directly or indirectly, own or have any interest in any real property (whether freehold or leasehold) or any land use rights;
|
3.1.16
|
Real Property Regulations
|
537518-4-8594-v7.4
|
‑
33
‑
|
17-40684037
|
3.1.17
|
Environmental Laws
|
(a)
|
are in compliance with all applicable Environmental Laws, have no actual or contingent liability to make good, repair, re-instate or clean up any of the Properties and have no knowledge of any imminent requirement for any of the foregoing;
|
(b)
|
have not received any notice of any actual or potential liability under applicable Environmental Laws; and
|
(c)
|
have received and are in compliance with all permits, licenses or other approvals required of them under applicable Environmental Laws which may result in the revocation or loss of such permits, licenses or other approvals, or otherwise result, individually or in the aggregate, in a Material Adverse Effect;
|
3.1.18
|
No Dispute
|
3.1.19
|
Tenants and Licensees of Properties
|
537518-4-8594-v7.4
|
‑
34
‑
|
17-40684037
|
3.1.20
|
Properties
|
(a)
|
has legal access, either directly or indirectly, to public roads or rights of way and each of the Properties is served by appropriate drainage, water, electricity and gas services all of which are connected to the public mains with no imminent or likely interruption of such passage or provision; and
|
(b)
|
has no structural or other material defects affecting or likely to affect the buildings and structures on or comprising such Properties or any parts of such Properties and such buildings and structures, are in good and substantial repair and condition and are fit for the purposes for which they are presently used or proposed to be used.
|
3.1.21
|
Use of Properties
|
3.1.22
|
Insurance
|
(a)
|
Effective as of the Completion Date, title to the Properties will be insured by the Title Insurance Company, in the name or for the benefit of Prime US-Tower At Emeryville, LLC in respect of Tower I at Emeryville, Prime US-222 Main, LLC in respect of 222 Main, Prime US-Village Center Station, LLC in respect of Village Center Station, Prime US-Village Center Station II, LLC in respect of Village Center Station II, Prime US-101 South Hanley, LLC in respect of 101 South Hanley, Prime US-Tower at Lake Carolyn, LLC in respect of Lake Carolyn, Prime US-Promenade, LLC in respect of Promenade, Prime
|
537518-4-8594-v7.4
|
‑
35
‑
|
17-40684037
|
(i)
|
in such amounts representing the respective purchase consideration at which each of the Insured Parties will purchase the relevant Property from the relevant Vendor;
|
(ii)
|
subject only to the Title Insurance Exceptions set forth in the applicable Proforma Title Policy for each Property; and
|
(iii)
|
the final title insurance policies shall be substantially in the form of the Proforma Title Policies and shall be in effect on the Listing Date.
|
(b)
|
On and from the Completion Date, for as long as the Property-Tier US LLCs are the owners of the Properties, the Properties will be insured in the name or for the relevant Insured Party by insurers of recognised financial responsibility against such losses and risks and in such amounts as are prudent and customary for properties of a similar nature as the relevant Property;
|
(c)
|
All such policies of insurance in (i) and (ii) above will be in full force and effect and from the closing of the transactions contemplated by the Portfolio Purchase and Sale Agreement and the Insured Parties will be in compliance with the terms of such policies and instruments, except where the failure to so comply would not individually or in the aggregate, result in the increase of premiums payable, the reduction of insured amounts or the termination of such policies;
|
(d)
|
None of the Trustee, the Manager, the Manager US Sub, Prime US REIT or any of the Trust Group Entities have been refused any insurance coverage sought or applied for with respect to each of the Properties; and
|
(e)
|
So far as the Manager is aware, no circumstances have arisen which would vitiate or permit the insurers to void any of the policies of insurance in effect relating to any of the Properties;
|
537518-4-8594-v7.4
|
‑
36
‑
|
17-40684037
|
3.1.23
|
Internal Accounting Controls
|
(a)
|
transactions are executed in accordance with management's general and specific authorisations;
|
(b)
|
transactions are recorded as necessary to (1) permit preparation of financial statements in accordance with International Financial Reporting Standards, (2) maintain books, records and accounts in relation to the performance of the assets of Prime US REIT and its subsidiaries which are accurate and fair and provide sufficient basis for the preparation of financial statements; and
|
(c)
|
all necessary announcements can and will be made as and when required by the Code and the Listing Rules.
|
3.1.24
|
Accounting Policies
|
3.1.25
|
Intellectual Property
|
537518-4-8594-v7.4
|
‑
37
‑
|
17-40684037
|
3.1.26
|
Information Provided
|
(a)
|
true and accurate in all material respects, and not misleading in any material respect, whether by omission or misstatement in light of the circumstances under which such statement was made, and no information in connection with the Offering or otherwise has been withheld by the Manager from the Joint Bookrunners and Underwriters and their legal or other professional advisers, or any of the Advisers, the SGX-ST or the MAS; and
|
(b)
|
as regards forecasts or estimates, and statements of opinion, belief, intention or expectation, truly, honestly and reasonably held and given in good faith after due and careful enquiry;
|
3.1.27
|
Marketing Materials
|
537518-4-8594-v7.4
|
‑
38
‑
|
17-40684037
|
3.1.28
|
Preliminary Prospectus and Prospectus
|
(a)
|
The Preliminary Prospectus (as at its date of publication) and the Prospectus (as of its date of publication and as at each Closing Date) contains and any amendment or supplement thereto will at their date of publication and each Closing Date contain, all information that investors and their professional advisers would reasonably require and reasonably expect to find there, or that is necessary to enable investors and their investment advisers to make an informed assessment of the merits and risks of an investment in Prime US REIT, including without limitation the assets and liabilities, financial position, performance, profits and losses and prospects of Prime US REIT and its subsidiaries, and the rights attaching to the Units;
|
(b)
|
the Preliminary Prospectus (as at its date of publication) and the Prospectus (as at its date of publication and each Closing Date) do not, and in the case of any amendment or supplement to the Prospectus as at the date of its publication and the Closing Date will not, contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading;
|
(c)
|
the statements of intention, opinion, belief or expectation contained in the Preliminary Prospectus (as at its date of publication) and the Prospectus (as at its date of publication and the Closing Date) were, and in the case of any amendment or supplement to the Prospectus at the date of its publication and the Closing Date will be, honestly and reasonably made or held; and
|
(d)
|
all reasonable enquiries have been made to ascertain such facts and to verify the accuracy of all such statements;
|
3.1.29
|
Independent Valuers
|
3.1.30
|
Reporting Auditors
|
537518-4-8594-v7.4
|
‑
39
‑
|
17-40684037
|
3.1.31
|
Financial and Statistical Information
|
(a)
|
The unaudited pro forma financial information of Prime US REIT and its subsidiaries (including any related notes and schedules) included in both the Preliminary Prospectus and the Prospectus:
|
(i)
|
presents accurately in all material respects the financial condition of Prime US REIT and its subsidiaries as of the dates indicated and has been prepared in conformity with International Financial Reporting Standards. The financial data set forth under the caption "Unaudited Pro Forma Financial Information" in both the Preliminary Prospectus and the Prospectus fairly and accurately presents in all material respects, on the basis stated in both the Preliminary Prospectus and the Prospectus, respectively, the information included therein;
|
(ii)
|
has been properly prepared on the basis of the assumptions set out in both the Preliminary Prospectus and the Prospectus after making the adjustments set out in the Preliminary Prospectus and the Prospectus (and that such adjustments are appropriate for the purpose of such preparation); and
|
(iii)
|
has been reviewed by the Reporting Auditors; and
|
(b)
|
Nothing has come to the attention of the Manager that has caused the Manager to believe that the statistical and market-related data included in the Preliminary Prospectus and the Prospectus is not based on or derived from sources that are reliable and accurate and the Manager has obtained the written consent to the use of such data from such sources to the extent required;
|
3.1.32
|
Forward-Looking Statements
|
537518-4-8594-v7.4
|
‑
40
‑
|
17-40684037
|
3.1.33
|
Working capital
|
3.1.34
|
No indebtedness
|
3.1.35
|
Collective Investment Scheme
|
537518-4-8594-v7.4
|
‑
41
‑
|
17-40684037
|
3.1.36
|
Announcements
|
3.1.37
|
Eligibility-to-list letter
|
3.1.38
|
Registration of Prospectus
|
3.1.39
|
No Broker's Fees
|
3.1.40
|
Taxes
|
3.1.41
|
Distributions
|
537518-4-8594-v7.4
|
‑
42
‑
|
17-40684037
|
3.1.42
|
No Undisclosed Relationships
|
(a)
|
none of the Manager (as manager of Prime US REIT), the Manager US Sub, the Trustee (as trustee of Prime US REIT), Prime US REIT, any of the Trust Group Entities is a party to any transaction entered into other than on normal commercial terms; and
|
(b)
|
no transaction exists between (1) the Manager (as manager of Prime US REIT), the Manager US Sub, Prime US REIT, the Trustee (as trustee of Prime US REIT), any of the Trust Group Entities and (2) any of the entities within the Keppel Group and/or the KBS Group and any interested party (as such term is defined in the Code) with regard to the business, undertakings, assets or properties (including the Properties) of Prime US REIT or any of the Trust Group Entities or otherwise,
|
3.1.43
|
Material Contracts
|
3.1.44
|
No Material Adverse Change
|
(a)
|
there has not been any change or a development involving a prospective change in the capital or long-term debt of Prime US REIT and/or any of
|
537518-4-8594-v7.4
|
‑
43
‑
|
17-40684037
|
(b)
|
neither Prime US REIT nor any of the Trust Group Entities have entered into any transaction that is material in the context of the Offering or incurred any liability or obligation, direct or contingent, that is material in the context of the Offering;
|
3.1.45
|
No Registration
|
3.1.46
|
AIFMD Compliance
|
3.1.47
|
No Directed Selling Efforts and No General Solicitation
|
3.1.48
|
No SUSMI
|
537518-4-8594-v7.4
|
‑
44
‑
|
17-40684037
|
3.1.49
|
Accredited Investor
|
(a)
|
each US Trust is a trust, which total assets in excess of US$5,000,000, not formed for the specific purpose of acquiring the Units offered; and
|
(b)
|
the purchase by each US Trust has been directed by a sophisticated person with such knowledge and experience in financial business matters that he is capable of evaluating the merits and risks of the prospective investment.
|
3.1.50
|
No Integration.
|
3.1.51
|
Investment Company Act
|
3.1.52
|
Compliance with the US Tax Code
|
(a)
|
The Parent US REIT's current organization and its current and anticipated investments and plan of operations as disclosed in the Preliminary Prospectus and the Prospectus will enable it to meet the requirements for qualification and taxation as a "real estate investment trust" pursuant to sections 856 through 860 of the US Tax Code;
|
(b)
|
each of the Property-Tier US LLCs' current organization and its current and anticipated investments and plan of operations as disclosed in the Preliminary Prospectus and the Prospectus will enable each of them to elect to be a U.S. REIT if such election is desirable in the opinion of the Parent US REIT's board of directors, and upon such election, will meet the requirements for qualification and taxation as a "real estate investment trust" pursuant to sections 856 through 860 of the US Tax Code;
|
3.1.53
|
All tax rulings obtained
|
537518-4-8594-v7.4
|
‑
45
‑
|
17-40684037
|
3.1.54
|
Compliance with Laws
|
3.1.55
|
Use of proceeds
|
3.1.56
|
Section 309B of the SFA
|
3.1.57
|
No unlawful payments
|
537518-4-8594-v7.4
|
‑
46
‑
|
17-40684037
|
3.1.58
|
No conflicts with Sanctions Laws
|
3.1.59
|
Compliance with Money Laundering Laws
|
537518-4-8594-v7.4
|
‑
47
‑
|
17-40684037
|
3.2
|
Representations and warranties of the Sponsor
|
3.2.1
|
Organisation of Sponsor and its respective subsidiaries
|
(a)
|
The Sponsor has been duly organised and is validly existing as a corporation under the laws of Singapore with full power and authority to enter into and perform any of the Transaction Documents to which it is a party and to own or lease, as the case may be, and to operate its assets and properties and conduct its business as described in the Preliminary Prospectus and the Prospectus;
|
(b)
|
KBS REIT Properties III has been duly organised and is validly existing as a limited liability company under the laws of the State of Delaware with full power and authority and has obtained all approvals, licenses, authorisations and consents to enter into and perform any of the Transaction Documents to which it is a party;
|
(c)
|
To the best of the Sponsor's knowledge after due and careful inquiries, the US Asset Manager has been duly organised and is validly existing as a limited liability company under the laws of the State of Delaware with full power and authority and has obtained all approvals, licenses, authorisations and consents to enter into and perform any of the Transaction Documents to which it is a party;
|
(d)
|
The Sponsor and KBS REIT Properties III have not taken any action, nor to the knowledge of the Sponsor have any other steps been taken or legal proceedings started or threatened against the Sponsor and/or KBS REIT Properties III for their winding up or dissolution, or for either of them to enter into any arrangement or composition for the benefit of creditors, or for the appointment of a receiver,
|
537518-4-8594-v7.4
|
‑
48
‑
|
17-40684037
|
(e)
|
To the best of the Sponsor's knowledge after due and careful inquiries, the US Asset Manager has not taken any action, nor have any other steps been taken or legal proceedings started or threatened against the US Asset Manager for its winding up or dissolution, or for it to enter into any arrangement or composition for the benefit of creditors, or for the appointment of a receiver, administrative receiver, provisional liquidator, trustee or similar officer for it, or any of its interests, properties, revenues or assets;
|
3.2.2
|
Transaction Documents
|
3.2.3
|
No conflicts
|
(a)
|
its Constitution, bylaws or other constitutive documents;
|
(b)
|
the terms of any Document to which the Sponsor is a party or bound or to which its assets or properties are subject; or
|
(c)
|
any statute, law, rule, regulation, judgment, order or decree applicable to the Sponsor of any court, regulatory body, administrative agency,
|
537518-4-8594-v7.4
|
‑
49
‑
|
17-40684037
|
3.2.4
|
No Consents
|
3.2.5
|
No Violation
|
(a)
|
any provision of its Constitution, bylaws or other constitutive documents;
|
(b)
|
any Document to which it is a party or bound or to which its assets or properties is subject; or
|
(c)
|
any statute, law, rule, regulation, judgment, order or decree of any court, regulatory body, administrative agency, governmental body, arbitrator or other authority having jurisdiction over it or any of its assets or properties, as applicable,
|
3.2.6
|
No Proceedings
|
537518-4-8594-v7.4
|
‑
50
‑
|
17-40684037
|
3.2.7
|
No immunity
|
3.2.8
|
No Stabilisation
|
3.2.9
|
Information Provided on the KBS Group
|
537518-4-8594-v7.4
|
‑
51
‑
|
17-40684037
|
(a)
|
true and accurate in all material respects, and not misleading in any material respect, whether by omission or misstatement in light of the circumstances under which such statement was made; and
|
(b)
|
as regards forecasts or estimates, and statements of opinion, belief, intention or expectation, truly, honestly and reasonably held and given in good faith after due and careful enquiry;
|
3.2.10
|
Preliminary Prospectus and Prospectus
|
3.2.11
|
No Registration
|
3.2.12
|
No Directed Selling Efforts
|
3.2.13
|
No SUSMI
|
537518-4-8594-v7.4
|
‑
52
‑
|
17-40684037
|
3.2.14
|
No unlawful payments
|
3.2.15
|
No conflicts with Sanctions Laws
|
537518-4-8594-v7.4
|
‑
53
‑
|
17-40684037
|
3.2.16
|
Compliance with Money Laundering Laws
|
3.3
|
Representations and warranties of the Unit Lender
|
3.3.1
|
Organisation of the Unit Lender
|
(a)
|
The Unit Lender has been duly organised and is validly existing as a limited liability company under the laws of the State of Delaware and has full legal right, power and authority and has obtained all approvals, licenses, authorisations and consents to enter into and perform its obligations under this Agreement, Unit Lending Agreement and the Lock-up Letter executed by it, and to carry out the transactions contemplated by them;
|
(b)
|
The Unit Lender has not taken any action, nor to the knowledge of the Unit Lender have any other steps been taken or legal proceedings started or threatened against the Unit Lender for its winding up or dissolution, or for it to enter into any arrangement or composition for the benefit of creditors, or for the appointment of a receiver, administrative receiver, provisional liquidator, trustee or similar officer for it, or any of its interests, properties, revenues or assets; and
|
3.3.2
|
Execution of Agreements
|
537518-4-8594-v7.4
|
‑
54
‑
|
17-40684037
|
3.3.3
|
No conflicts
|
(a)
|
its Constitution, bylaws or other constitutive documents;
|
(b)
|
the terms of any Document to which the Unit Lender is a party or bound or to which its assets or properties is subject; or
|
(c)
|
any statute, law, rule, regulation, judgment, order or decree (including, without limitation, the Listing Rules) of any court, regulatory body, administrative agency, governmental body, arbitrator or other authority applicable to the Unit Lender or any of its assets and properties,
|
3.3.4
|
Preliminary Prospectus and Prospectus
|
537518-4-8594-v7.4
|
‑
55
‑
|
17-40684037
|
3.3.5
|
No consents
|
3.3.6
|
No violation
|
(a)
|
any provision of its constitutive documents;
|
(b)
|
any Document to which it is a party or bound or to which its assets or properties is subject; or
|
(c)
|
any statute, law, rule, regulation, judgment, order or decree of any court, regulatory body, administrative agency, governmental body, arbitrator or other authority having jurisdiction over its or any of its assets or properties, as applicable,
|
3.3.7
|
No proceedings
|
537518-4-8594-v7.4
|
‑
56
‑
|
17-40684037
|
3.3.8
|
No immunity
|
3.3.9
|
Over-Allotment Units
|
3.3.10
|
No stabilisation
|
3.3.11
|
Unit Lending Agreement
|
3.3.12
|
No Registration
|
537518-4-8594-v7.4
|
‑
57
‑
|
17-40684037
|
3.3.13
|
No Directed Selling Efforts
|
3.3.14
|
No SUSMI
|
3.3.15
|
No unlawful payments
|
3.3.16
|
No conflicts with Sanctions Laws
|
537518-4-8594-v7.4
|
‑
58
‑
|
17-40684037
|
3.3.17
|
Compliance with Money Laundering Laws
|
3.4
|
Repetition of representations and warranties
|
3.5
|
Reliance on representations and warranties
|
3.6
|
Representations and warranties independent
|
537518-4-8594-v7.4
|
‑
59
‑
|
17-40684037
|
3.7
|
Officers' Certificates
|
4.
|
UNDERTAKINGS BY THE MANAGER, THE SPONSOR AND THE UNIT LENDER
|
4.1
|
Copies of Prospectus
|
4.2
|
No amendments
|
4.3
|
Notice
|
4.3.1
|
Representations and Warranties
|
4.3.2
|
Prospectus
|
(a)
|
any statement of fact contained in the Preliminary Prospectus or the Prospectus (as then amended or supplemented) would not be true and accurate in all material respects or is misleading in any material respect;
|
537518-4-8594-v7.4
|
‑
60
‑
|
17-40684037
|
(b)
|
the Preliminary Prospectus or the Prospectus (as then amended or supplemented) would not contain all information investors and their professional advisers would reasonably require and reasonably expect to find there, or that is necessary to enable investors and their professional advisers to make an informed assessment of the merits and risks of an investment in Prime US REIT, including without limitation the assets and liabilities, financial position, profits and losses and prospects of Prime US REIT and the Trust Group Entities and of the rights attached to the Units;
|
(c)
|
any information would be omitted from the Preliminary Prospectus or the Prospectus (as then amended or supplemented) which might be necessary in order to make the statements in the Preliminary Prospectus or the Prospectus (as then amended or supplemented and as the case may be) not misleading in any material respect or which, in the context of the offering and sale of Units pursuant to the Offering, would be material for disclosure in the Preliminary Prospectus or the Prospectus (as the case may be); or
|
(d)
|
if it shall be necessary to amend or supplement the Prospectus, to comply with applicable law or regulation, rule or directive (including without limitation, the SFA, the CIS Regulations, the Code and the Listing Rules) by any governmental, supervisory or administrative bodies or agencies (including without limitation the SGX-ST and MAS); or
|
4.3.3
|
Breach
|
(i)
|
notify the Joint Bookrunners and Underwriters of any such event or circumstance in writing;
|
(ii)
|
in the case of the Manager only, subject to the requirements of Clause 4.2, with respect to Clause 4.3.2 prepare an amendment or supplement that will correct such statement or omission or effect such compliance;
|
(iii)
|
in the case of the Manager only, supply any supplemented or amended Prospectus to the Joint Bookrunners and Underwriters, and the counsel for the Joint Bookrunners and Underwriters without charge in such quantities as they may reasonably request; and
|
(iv)
|
take such other steps as may be reasonably requested by the Joint Bookrunners and Underwriters to publicise the same.
|
537518-4-8594-v7.4
|
‑
61
‑
|
17-40684037
|
4.4
|
Qualifications
|
4.5
|
No actions which would require registration of Units
|
4.6
|
No directed selling efforts
|
4.7
|
Listing, clearance and settlement
|
4.7.1
|
Cause Listing
|
4.7.2
|
Maintain Listing
|
537518-4-8594-v7.4
|
‑
62
‑
|
17-40684037
|
4.7.3
|
Clearance and Settlement
|
4.8
|
Lock-ups
|
4.8.1
|
Each of the Manager, KBS REIT III, KBS REIT Holdings III, KBS LP III and KBS REIT Properties III, severally agrees to execute and deliver, to the Joint Bookrunners and Underwriters their respective Lock-up Letters and to comply with and procure the compliance with the same.
|
4.8.2
|
Each of the Manager and the Sponsor severally agrees to procure the execution and delivery to the Joint Bookrunners and Underwriters of the Lock-up Letter by KBS REIT III, KBS REIT Holdings III, KBS LP III and KBS REIT Properties III.
|
4.9
|
Further undertakings
|
4.9.1
|
to not amend any of the terms of the KBS Subscription Agreement without the written consent of all the Joint Global Coordinators (such consent not to be unreasonably withheld or delayed);
|
4.9.2
|
(in the case of the Manager only) to not waive any breach by KBS REIT Properties III of the terms of the KBS Subscription Agreement without the written consent of all the Joint Global Coordinators (such consent not to be unreasonably withheld or delayed);
|
4.9.3
|
to not terminate the KBS Subscription Agreement or take any action which might jeopardise the existence, or enforceability of any of the terms, of the KBS Subscription Agreement without the written consent of all the Joint Global Coordinators (such consent not to be unreasonably withheld or delayed);
|
4.9.4
|
that it shall not breach any of its obligations and it shall duly and promptly perform its obligations under this Agreement and each of the Transaction Documents to which it is a party, and (in the case of the Manager only) to procure the performance of the relevant entities' obligations under the Portfolio Sale and Purchase Agreement;
|
4.9.5
|
(in the case of the Manager only) to procure that non-voting, fixed coupon preferred stock shall be issued by the Parent US REIT to more than 100 individuals who shall not be related to the Manager, the Sponsor or their
|
537518-4-8594-v7.4
|
‑
63
‑
|
17-40684037
|
(a)
|
all units of ownership interest of each of the Property-Tier US LLCs (except for Prime US-222 Main, LLC) shall be held by the Lower-Tier US LLC;
|
(b)
|
all units of ownership interest of Prime US-222 Main, LLC shall be held by Prime US-Acquisition I, LLC;
|
(c)
|
all units of ownership interest of Prime US-Acquisition I, LLC shall be held by Prime US Properties, LLC;
|
(d)
|
all units of ownership interest of each of Prime US Properties, LLC and the Lower-Tier US LLC shall each be held by the Mid-Tier US LLC;
|
(e)
|
all units of ownership interest of the Mid-Tier US LLC shall be held by the Upper-Tier US LLC;
|
(f)
|
all units of ownership interest of the Upper-Tier US LLC shall be held by the Parent US REIT; and
|
(g)
|
100% of the voting shares of common stock in the Parent US REIT shall be held by Singapore Sub 1,
|
4.9.6
|
(in the case of the Manager only) to procure the issue of the title insurance policies in the form of the Proforma Title Insurance Policies (which shall provide coverage for a Property up to the amount of consideration paid or payable to the applicable Vendor and which shall only be subject the Title Insurance Exceptions) by the Title Insurance Company;
|
4.9.7
|
to promptly notify the Joint Bookrunners and Underwriters of all communications (written or oral) between the Manager (or any person acting on its behalf, including any legal counsel) and/or the Sponsor (or any person acting on its behalf, including any legal counsel) in respect of or relating to Clauses 4.9.1, 4.9.2 and 4.9.3; and
|
4.9.8
|
(in the case of the Manager only) to diligently pursue and enforce its rights under the KBS Subscription Agreement, including without limitation, if requested by any Joint Bookrunner and Underwriter, claiming for specific performance under the KBS Subscription Agreement. In pursuing or enforcing its rights under the KBS Subscription Agreement, the Manager shall act in accordance with the reasonable instructions of the Joint Bookrunners and Underwriters.
|
537518-4-8594-v7.4
|
‑
64
‑
|
17-40684037
|
4.10
|
Cornerstone Subscription Agreements
|
4.10.1
|
shall not amend any of the terms of the Cornerstone Subscription Agreements without the written consent of all the Joint Bookrunners and Underwriters (such consent not to be unreasonably withheld or delayed);
|
4.10.2
|
shall not waive any breach by any Cornerstone Investor of the terms of the Cornerstone Subscription Agreement without the written consent of all the Joint Bookrunners and Underwriters (such consent not to be unreasonably withheld or delayed);
|
4.10.3
|
shall not terminate the Cornerstone Subscription Agreements or take any action which might jeopardise the existence, or enforceability of any of the terms, of the Cornerstone Subscription Agreements without the written consent of all the Joint Bookrunners and Underwriters (such consent not to be unreasonably withheld or delayed;
|
4.10.4
|
shall not breach any of its obligations and it shall duly and promptly perform its obligations under the Cornerstone Subscription Agreements;
|
4.10.5
|
shall promptly notify the Joint Bookrunners and Underwriters of all written communications between the Manager (or any person acting on its behalf, including any legal counsel) and any Cornerstone Investor (or any person acting on its behalf, including any legal counsel) in respect of or relating to amendment or waiver of any terms of the Cornerstone Subscription Agreements or termination of the Cornerstone Subscription Agreements; and
|
4.10.6
|
shall diligently pursue and enforce its rights under the Cornerstone Subscription Agreements, including without limitation, if requested by any Joint Bookrunner and Underwriter, claiming for specific performance under the Cornerstone Subscription Agreements. In pursuing or enforcing its rights under the Cornerstone Subscription Agreements, the Manager shall act in accordance with the reasonable instructions of the Joint Bookrunners and Underwriters. The Manager shall, at the request of the Joint Bookrunners and Underwriters, to the extent permitted under law, assign its rights under the Cornerstone Subscription Agreements to the Joint Bookrunners and Underwriters.
|
4.11
|
No stabilisation
|
4.11.1
|
None of the Manager, the Sponsor and the Unit Lender or any of their respective Affiliates or any person acting on their behalf (other than the Stabilising Manager or any of its Affiliates or other persons acting on behalf of the Stabilising Manager), will take, directly or indirectly, any action designed to or which has constituted or which might be expected to cause or result, under any applicable law or regulation or otherwise, in stabilisation or manipulation of the price of any security of Prime US REIT (including the Units, options in respect of the Units and other securities which are convertible into or exchangeable for Units) to facilitate the sale or resale of the Units, or which would or might otherwise constitute stabilising action or the purpose of which is to create actual,
|
537518-4-8594-v7.4
|
‑
65
‑
|
17-40684037
|
4.11.2
|
The Manager:
|
(a)
|
will, on the date of this Agreement, execute and deliver the Stabilising Manager Appointment Letter (such letter to be in form and substance compliant with applicable law as set out in Schedule 6) to the Stabilising Manager, for the Stabilising Manager to deliver to the SGX-ST;
|
(b)
|
and the Unit Lender will, (i) as soon as practicable before the First Closing Date, deliver to the Stabilising Manager a list in writing of all its associates (as defined in Section 4(6) of the SFA and for the purpose of Regulation 3A(8) of the Securities and Futures (Market Conduct) (Exemptions) Regulations 2006 of Singapore) as of the date of its notice to the Stabilising Manager (being a date after the date of this Agreement), and (ii) thereafter, and from time to time up to the last day on which the Over-Allotment Option may be exercised, deliver to the Stabilising Manager an updated list of any other persons who become its associates after the date of the earlier notice to the Stabilising Manager; and
|
(c)
|
and the Unit Lender will not, and will procure that its respective associates (as defined for the purposes of Regulation 3A(8) of the Securities and Futures (Market Conduct) (Exemptions) Regulations 2006) will not, directly or indirectly, effect any sell order of the Units through the Stabilising Manager for the period commencing the date of the commencement of dealing in the Units on the SGX-ST and expiring on the Option Closing Date.
|
4.12
|
Use of Proceeds
|
4.12.1
|
to fund or facilitate any activities of or business with any person that, at the time of such funding or facilitation, is the subject or the target of the Sanctions,
|
4.12.2
|
to fund or facilitate any activities of or business in any Sanctioned Country,
|
4.12.3
|
in any other manner that causes any person, including the Joint Bookrunners and Underwriters, to violate the Sanctions, or
|
4.12.4
|
in any manner that violates Anti-Money Laundering and Anti-Terrorism Financing Laws or Anti-Bribery Laws,
|
537518-4-8594-v7.4
|
‑
66
‑
|
17-40684037
|
4.13
|
Assistance
|
4.14
|
No announcements
|
4.15
|
Compliance with Laws
|
4.16
|
Selling restrictions
|
4.17
|
No public offering
|
537518-4-8594-v7.4
|
‑
67
‑
|
17-40684037
|
4.18
|
Compliance with US Tax Code
|
4.19
|
No competition
|
4.19.1
|
90 days from the last Option Closing Date; and
|
4.19.2
|
the date this Agreement is terminated in accordance with Clause 8.1,
|
5.
|
REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS BY THE JOINT BOOKRUNNERS AND UNDERWRITERS
|
5.1
|
Selling Restrictions
|
5.2
|
Representations and warranties
|
5.2.1
|
it has the requisite power and authority to enter into and perform this Agreement;
|
537518-4-8594-v7.4
|
‑
68
‑
|
17-40684037
|
5.2.2
|
this Agreement constitutes its valid and legally binding obligations in accordance with its terms (subject to bankruptcy, insolvency and similar laws of general applicability relating to or affecting creditors' rights and to general principles of equity); and
|
6.
|
COMMISSIONS, COSTS AND EXPENSES
|
6.1
|
Fees payable by the Manager and the Sponsor
|
6.1.1
|
Financial Adviser Fee
|
6.1.2
|
Underwriting, Selling and Management Commission on the Placement Units and Cornerstone Units
|
6.1.3
|
Underwriting, Selling and Management Commission on the Over-Allotment Units
|
6.1.4
|
Incentive Fee on the Placement Units and Cornerstone Units
|
537518-4-8594-v7.4
|
‑
69
‑
|
17-40684037
|
6.1.5
|
Incentive Fee on the Over-Allotment Units
|
6.2
|
Prime US REIT's costs and expenses
|
6.2.1
|
Professional Advisers
|
6.2.2
|
Trustee
|
6.2.3
|
Transaction Documents
|
537518-4-8594-v7.4
|
‑
70
‑
|
17-40684037
|
6.2.4
|
Offering Documents
|
6.2.5
|
Marketing logistics
|
6.2.6
|
Qualification
|
6.2.7
|
SGX-ST and MAS
|
6.2.8
|
Participating Banks
|
6.2.9
|
Taxes and Duties
|
537518-4-8594-v7.4
|
‑
71
‑
|
17-40684037
|
6.2.10
|
Other
|
6.3
|
Joint Bookrunners and Underwriters' expenses
|
6.3.1
|
Professional Advisers
|
6.3.2
|
Marketing Logistics
|
6.3.3
|
Acquisitions
|
537518-4-8594-v7.4
|
‑
72
‑
|
17-40684037
|
6.3.4
|
Taxes and Duties
|
6.3.5
|
Prime US REIT's Costs and Expenses
|
6.3.6
|
Remittance
|
6.3.7
|
Other
|
6.4
|
Gross-up
|
537518-4-8594-v7.4
|
‑
73
‑
|
17-40684037
|
6.5
|
Goods and Services Tax
|
6.6
|
Brokerage fees
|
6.7
|
Repayment Side Letter
|
7.
|
CLOSING AND CONDITIONS
|
7.1
|
Closing
|
7.1.1
|
Subject to the fulfilment of the conditions set out in Clause 7.3, the closing of the subscription for the Placement Units and the sale and purchase of any OverAllotment Units in respect of which the First Closing Date has been designated as the Option Closing Date shall take place at 10.00 a.m. (Singapore time) (or such other time as the Manager and the Joint Global Coordinators may agree in writing) on the First Closing Date. The closing of the sale and purchase of any Over-Allotment Units in respect of which the Over-Allotment Option has been exercised and in respect of which the First Closing Date has not been designated as the Option Closing Date therefore shall take place in writing at 3.00 p.m. (Singapore time) (or such other time as the Manager and the Joint Global Coordinators may agree) on the Option Closing Date designated in the notice of such exercise.
|
537518-4-8594-v7.4
|
‑
74
‑
|
17-40684037
|
7.1.2
|
The Manager (in the case of the Placement Units), the Unit Lender (in the case of the Over-Allotment Units), the Sponsor and the Joint Global Coordinators may agree to postpone any Closing Date (in the case of Placement Units) or Option Closing Date (in the case of Over-Allotment Units) to another date being (in relation to that Closing Date) a date failing not more than 20 Business Days after the date originally designated as such Closing Date, and (in relation to any Option Closing Date) a date falling not more than two Business Days after the date originally designated as such Option Closing Date, whereupon all other references herein to such Closing Date or Option Closing Date (as the case may be) shall be construed as being to that later date.
|
7.2
|
Payment and delivery
|
7.2.1
|
Delivery of the Units shall be made to the CDP account(s) or sub-account(s) of each Joint Bookrunner and Underwriter or as it may direct against payment by the Joint Bookrunners and Underwriters of the Offering Price in relation to the Placement Units, to be paid to the Trustee in the manner to be agreed between the Manager and the Joint Bookrunners and Underwriters, less any deductions made pursuant to Clause 6.1, Clause 6.2, Clause 6.3, Clause 6.4 Clause 6.5 and/or Clause 6.7; and
|
7.2.2
|
In relation to the Over-Allotment Units in respect of which the Over-Allotment Option has been exercised, payment by the Joint Bookrunners and Underwriters of the Offering Price in relation to the Over-Allotment Units on an Option Closing Date, to or to the order of the Unit Lender, by giving irrevocable instructions to effect a telegraphic transfer.
|
7.3
|
Conditions Precedent to First Closing
|
7.3.1
|
Closing Documents
|
537518-4-8594-v7.4
|
‑
75
‑
|
17-40684037
|
(a)
|
Opinions of Allen & Gledhill LLP
. On the Date of Registration, a Singapore law disclosure opinion dated the Date of Registration, and on the First Closing Date, a Singapore law enforceability opinion and a "bring down" Singapore law disclosure opinion dated as of the First Closing Date, addressed to the Joint Bookrunners and Underwriters from Allen & Gledhill LLP, in agreed form;
|
(b)
|
Opinions of Clifford Chance Pte. Ltd
. On the Date of Registration, a Singapore law disclosure opinion dated the Date of Registration, and on the First Closing Date, a Singapore law enforceability opinion and a "bring down" Singapore law disclosure opinion dated as of the First Closing Date, addressed to the Joint Bookrunners and Underwriters from Clifford Chance Pte. Ltd., in agreed form;
|
(c)
|
Opinions of DLA Piper LLP (US)
. On the Date of Registration, a U.S. corporate legal opinion dated the Date of Registration, and on the First Closing Date, a U.S. corporate legal opinion dated as of the First Closing Date, addressed to the Joint Bookrunners and Underwriters from DLA Piper LLP (US), in agreed form;
|
(d)
|
Opinions of Greenberg Traurig, LLP
. On the Date of Registration, a U.S. corporate and enforceability legal opinion on the Portfolio Sale and Purchase Agreement dated the Date of Registration, and on the First Closing Date, a "bring down" U.S. corporate and enforceability legal opinion on the Portfolio Sale and Purchase Agreement dated as of the First Closing Date, addressed to the Joint Bookrunners and Underwriters from Greenberg Traurig, LLP, in agreed form;
|
(e)
|
No-Registration Opinion
. On the First Closing Date, a no-registration opinion dated the First Closing Date addressed to the Joint Bookrunners and Underwriters from Clifford Chance Pte. Ltd., in agreed form;
|
(f)
|
Legal Due Diligence Reports of Greenberg Traurig, LLP
. On or prior to the date of lodgement of the Prospectus, and on the Date of Registration, legal due diligence reports for each of the Properties addressed to the Joint Bookrunners and Underwriters from Greenberg Traurig, LLP, in agreed form;
|
(g)
|
Certificate of the Manager
. A signed Officers' Certificate dated as of the First Closing Date from the Manager, substantially in the form set out in Schedule 3;
|
(h)
|
Certificates of the Sponsor
. A signed Officers' Certificate dated as of the First Closing Date from the Sponsor, substantially in the form set out in Schedule 4;
|
(i)
|
Reporting Auditor's Comfort Letters
. On the date of Registration, a comfort letter dated the Date of Registration respectively, and on the First Closing Date, a "bring-down" comfort letter dated as of the First Closing Date, addressed to the Joint Bookrunners and Underwriters from the Reporting Auditor, in agreed form;
|
537518-4-8594-v7.4
|
‑
76
‑
|
17-40684037
|
(j)
|
Marketing Materials
. In relation to each Marketing Material disseminated or published after registration of the Prospectus by the MAS and prior to the First Closing Date, prior to the dissemination or publication of each such Marketing Material, the Joint Bookrunners and Underwriters having received a confirmation in relation to each such Marketing Material, dated the date of dissemination or publication and substantially in the form set out in Schedule 9 and signed by a member of the senior management (in respect of the Manager, as defined in the CIS Regulations) of the Manager;
|
(k)
|
Tax Comfort Letters
. On the date of lodgement of the Preliminary Prospectus with the MAS and on the Date of Registration, comfort letters dated the date of lodgment of the Preliminary Prospectus with the MAS and the Date of Registration respectively, and on the First Closing Date, a "bring-down" comfort letter dated as of the First Closing Date, addressed to the Joint Bookrunners and Underwriters from each of the independent Singapore tax adviser, Allen & Gledhill LLP and the independent U.S. tax adviser, DLA Piper LLP (US), in agreed form;
|
(l)
|
Reliance Letters
. On the date of lodgement of the Preliminary Prospectus and the Date of Registration, reliance letters dated the date of lodgement of the Preliminary Prospectus and the Date of Registration, respectively, addressed to the Joint Bookrunners and Underwriters from the independent valuers, Cushman & Wakefield Illinois, Inc. and JLL Valuation & Advisory Services, LLC and the independent market research consultant, Cushman & Wakefield Illinois, Inc., in agreed form;
|
(m)
|
Transaction Documents
. Each Transaction Document to be entered into prior to the First Closing Date, duly executed and delivered, on or before the First Closing Date by or on behalf of all parties thereto;
|
(n)
|
Tax Rulings
.
The Tax Rulings shall not have been withdrawn or materially and adversely amended;
|
(o)
|
SGX-ST Waiver
. The SGX-ST Waiver shall not have been withdrawn or materially and adversely amended;
|
(p)
|
MAS Waiver
. The MAS Waiver shall not have been withdrawn or materially and adversely amended;
|
(q)
|
CMS Licence
. The CMS Licence, shall be in full force and effect and not amended or revoked and there being no breach of the terms and conditions applicable to the CMS Licence; and
|
(r)
|
Authorisation
. The authorisation of Prime US REIT as a collective investment scheme by the MAS having not been withdrawn or materially and adversely amended;
|
7.3.2
|
Singapore
Offer Agreement
|
537518-4-8594-v7.4
|
‑
77
‑
|
17-40684037
|
7.3.3
|
Unit Lending Agreement
|
7.3.4
|
KBS Subscription Agreement
|
7.3.5
|
KCIH Cornerstone Subscription Agreements
|
7.3.6
|
US Trusts Cornerstone Subscription Agreements
|
7.3.7
|
Lock-Up Letters
|
7.3.8
|
Listing of Units
|
537518-4-8594-v7.4
|
‑
78
‑
|
17-40684037
|
7.3.9
|
Breach of Obligations
|
7.3.10
|
Specific Obligations
|
(a)
|
the completion of the Portfolio Sale and Purchase Agreement, and the terms thereof not having been breached in any respect or terminated;
|
(b)
|
the execution of the escrow letter pursuant to the Portfolio Sale and Purchase Agreement ensuring, among other things, the commitment of the Title Insurance Company to issue its owner's policy of title insurance upon satisfaction of the conditions precedent to such escrow letter; and
|
537518-4-8594-v7.4
|
‑
79
‑
|
17-40684037
|
(c)
|
the facility agreements entered into in relation to the Facilities and the terms therein being in full force and effect and not having been waived, breached, amended, varied, supplemented or terminated in any material respect.
|
7.3.11
|
Prospectus
|
7.3.12
|
No Change in Law
|
7.3.13
|
No Amendment or Supplement to the Prospectus
|
7.3.14
|
No Withdrawal of Consent
|
7.3.15
|
No Termination
|
537518-4-8594-v7.4
|
‑
80
‑
|
17-40684037
|
7.4
|
Conditions Precedent to Option Closing
|
7.4.1
|
Closing Documents
|
(a)
|
Opinions of Allen & Gledhill LLP
. On the Option Closing Date, a "bring down" Singapore law enforceability opinion dated as of the Option Closing Date, addressed to the Joint Bookrunners and Underwriters from Allen & Gledhill LLP, in agreed form;
|
(b)
|
Opinions of Clifford Chance LLP
. On the Option Closing Date, a "bring down" Singapore law enforceability opinion dated as of the Option Closing Date, addressed to the Joint Bookrunners and Underwriters from Clifford Chance LLP,
in agreed form;
|
(c)
|
No-Registration Opinion
. On the Option Closing Date, a "bring-down" noregistration opinion dated as of the Option Closing Date addressed to the Joint Bookrunners and Underwriters from Clifford Chance Pte. Ltd., in agreed form;
|
(d)
|
Certificate of the Manager
. A signed Officers' Certificate dated as of the Option Closing Date from the Manager, substantially in the form set out in Schedule 3;
|
(e)
|
Certificate of the Sponsor
. A signed Officers' Certificates dated as of the Option Closing Date from the Sponsor, substantially in the form set out in Schedule 4;
|
(f)
|
Certificate of the Unit Lender
. A signed Officers' Certificates dated as of the Option Closing Date from the Unit Lender, substantially in the form set out in Schedule 5;
|
(g)
|
Reporting Auditor's Comfort Letters
. On the Option Closing Date, a "bring down" comfort letter dated as of the Option Closing Date, addressed to the Joint Bookrunners and Underwriters from the Reporting Auditors, in agreed form; and
|
(h)
|
Tax Comfort Letters
. On the Option Closing Date, a "bring-down" comfort letter dated as of the Closing Date,
|
537518-4-8594-v7.4
|
‑
81
‑
|
17-40684037
|
7.4.2
|
No changes
|
7.4.3
|
Breach of Obligations
|
7.4.4
|
No Amendment or Supplement to the Prospectus
|
537518-4-8594-v7.4
|
‑
82
‑
|
17-40684037
|
7.4.5
|
Lock-Up Letters
|
7.4.6
|
No Withdrawal of Consent
|
7.4.7
|
No Termination
|
7.4.8
|
Status of Documents and Approvals, Rulings or Waivers
|
7.5
|
Delivery of documents
|
7.6
|
Effect of non-fulfilment of conditions precedent
|
537518-4-8594-v7.4
|
‑
83
‑
|
17-40684037
|
8.
|
TERMINATION
|
8.1
|
Termination notice
|
8.1.1
|
Inaccuracy of representations and warranties
|
8.1.2
|
Material adverse change
|
8.1.3
|
Suspension of trading
|
537518-4-8594-v7.4
|
‑
84
‑
|
17-40684037
|
8.1.4
|
Force majeure
|
8.1.5
|
Hostilities
|
8.1.6
|
Taxation
|
8.1.7
|
Change
|
537518-4-8594-v7.4
|
‑
85
‑
|
17-40684037
|
8.1.8
|
Winding up
|
8.1.9
|
Closing Date
|
8.2
|
Effects of termination
|
8.3
|
Saving
|
9.
|
INDEMNIFICATION AND CONTRIBUTION
|
9.1
|
Indemnity by the Manager
|
537518-4-8594-v7.4
|
‑
86
‑
|
17-40684037
|
9.1.1
|
Performance of the Agreement
|
9.1.2
|
Misstatements
|
9.1.3
|
General Duty of Disclosure
|
9.1.4
|
Breach of Agreement
|
9.1.5
|
Failure to comply with law
|
537518-4-8594-v7.4
|
‑
87
‑
|
17-40684037
|
9.2
|
Indemnity by the Sponsor
|
9.2.1
|
to fully indemnify, defend and hold harmless on a continuing and after tax basis each Indemnified Person against any and all Losses or Claims joint or several (including legal fees and any applicable GST, value added tax or other similar taxes)) which it may become subject to (whether or not such Claim is successful, compromised or settled, and whether actual, pending or threatened), insofar as such Losses or Claims are based on or arising, or indirectly, out of any breach or alleged breach by the Sponsor of any of the representations, warranties, undertakings or obligations made by, or relating to, it under this Agreement; and
|
9.2.2
|
without limiting Clause 9.2.1, to reimburse each Indemnified Person on a full indemnity basis for all costs, charges and expenses, (including legal fees and any applicable GST or value added tax) related to enforcement proceedings incurred by such Indemnified Person in connection with investigating, disputing, defending, settling or responding any such Claims or Losses based on or arising, directly or indirectly, out of any breach or alleged breach by the Sponsor of any of the representations, warranties, undertakings or obligations made by, or relating to, it under this Agreement (whether actual, pending or threatened and whether or not any Indemnified Person is or may be a party to any such Claims) or exercise of any right of action or the enforcement of any such settlement or any judgment obtained in respect of any Claims and Losses.
|
9.3
|
Back-up indemnity by the Sponsor
|
537518-4-8594-v7.4
|
‑
88
‑
|
17-40684037
|
9.3.1
|
if the Manager fails to pay any or all amounts owed by it under Clause 9.1 or Clause 9.5 following (i) the date on which such amounts have been declared by a court of competent jurisdiction (without being subject to further appeal) to be due and payable, or (ii) the date on which the Manager has admitted liability in writing to make such payments; or
|
9.3.2
|
if the Manager shall have been adjudged by a court of competent jurisdiction to have acted with fraud, gross negligence, wilful default and/or breach of the Trust Deed while acting as manager of Prime US REIT and/or to have failed to have shown the degree of diligence and care required of it having regard to the provisions of the Trust Deed, and thereby having no right to be indemnified out of and to have recourse to the assets of Prime US REIT under the Trust Deed or at law, for the amounts owed by such Manager under Clause 9.1 or Clause 9.5,
|
9.4
|
Indemnity by the Unit Lender
|
9.4.1
|
to fully indemnify, defend and hold harmless on a continuing and after tax basis each Indemnified Person against any and all Losses or Claims joint or several (including legal fees and any applicable GST, value added tax or other similar taxes)) which it may become subject to (whether or not such Claim is successful, compromised or settled, and whether actual, pending or threatened), insofar as such Losses or Claims are based on or arising, or indirectly, out of any breach or alleged breach by the Unit Lender of the representations, warranties, undertakings or obligations made by, or relating to, it under this Agreement; and
|
9.4.2
|
without limiting Clause 9.4.1, to reimburse each Indemnified Person on a full indemnity basis for all costs, charges and expenses, (including legal fees and any applicable GST or value added tax) related to enforcement proceedings incurred by such Indemnified Person in connection with investigating, disputing, defending, settling or responding any such Claims or Losses based on or arising, directly or indirectly, out of any breach or alleged breach by the Unit Lender of any of the representations, warranties, undertakings or obligations made by, or relating to, it under this Agreement (whether actual, pending or threatened and
|
537518-4-8594-v7.4
|
‑
89
‑
|
17-40684037
|
9.5
|
Contribution
|
537518-4-8594-v7.4
|
‑
90
‑
|
17-40684037
|
9.6
|
Conduct of Claims
|
9.7
|
Arrangement with advisers
|
537518-4-8594-v7.4
|
‑
91
‑
|
17-40684037
|
9.7.1
|
not be entitled to recover any amount from any Indemnified Person which, in the absence of such exclusion or limitation, the indemnifying party or the Indemnified Person would not have been entitled to recover; and
|
9.7.2
|
indemnify the Indemnified Persons in respect of any increased liability to any third party which would not have arisen in the absence of such exclusion or limitation.
|
9.8
|
Payments
|
10.
|
GENERAL
|
10.1
|
Time of the essence
|
10.2
|
Survival
|
10.3
|
Rights and remedies
|
10.4
|
Currency indemnity
|
537518-4-8594-v7.4
|
‑
92
‑
|
17-40684037
|
10.5
|
Successors and assigns
|
10.6
|
Rights of third parties
|
10.7
|
Entire agreement
|
10.8
|
No fiduciary relationship
|
(a)
|
each of the Joint Bookrunners and Underwriters is acting on an arm's length basis as principal, and not as its agent or adviser, to provide the services
|
537518-4-8594-v7.4
|
‑
93
‑
|
17-40684037
|
(b)
|
the Joint Bookrunners and Underwriters are not acting in a fiduciary or advisory capacity with respect to it;
|
(c)
|
the Joint Bookrunners and Underwriters are not assuming any duties or obligations other than those expressly set forth in this Agreement and may have interests that differ from its interests; and
|
537518-4-8594-v7.4
|
‑
94
‑
|
17-40684037
|
10.9
|
Severability
|
11.
|
NOTICES
|
11.1
|
Form
|
11.2
|
Delivery
|
537518-4-8594-v7.4
|
‑
95
‑
|
17-40684037
|
537518-4-8594-v7.4
|
‑
96
‑
|
17-40684037
|
537518-4-8594-v7.4
|
‑
97
‑
|
17-40684037
|
11.3
|
Effectiveness
|
12.
|
LAW AND JURISDICTION
|
12.1
|
Governing law
|
12.2
|
Jurisdiction of Singapore courts
|
12.3
|
Serving documents
|
537518-4-8594-v7.4
|
‑
98
‑
|
17-40684037
|
12.4
|
Appointment of Process Agents
|
12.4.1
|
Each Guarantor hereby irrevocably appoints KBS Asia Partners Pte. Ltd. of 9 Raffles Place, #26-01 Republic Plaza, Singapore 048619 as agent to accept service of process in Singapore in any legal action or proceedings arising out of this Agreement, service upon whom will be deemed completed whether or not forwarded to or received by the Guarantors. The Guarantors will inform the Joint Bookrunners and Underwriters, in writing, of any change in the address of the process agent of the Guarantors and such change in address will not be effective until such notice is received by the Joint Bookrunners and Underwriters. Such service will be deemed to be completed on delivery to the process agent (whether or not it is forwarded to and received by the Guarantors). If such process agent ceases to be able to act as such or to have an address in Singapore, each Guarantor irrevocably agrees to immediately appoint a new process agent in Singapore acceptable to the Joint Bookrunners and Underwriters and to deliver to the Joint Bookrunners and Underwriters within 14 days a copy of a written acceptance of appointment by the process agent.]
|
12.4.2
|
Nothing in this Clause 12.4 will affect the right of the parties hereto to serve process in any other manner permitted by law.
|
12.5
|
Waiver of immunity
|
13.
|
COUNTERPARTS
|
14.
|
GUARANTEE
|
14.1
|
The Guarantee
|
14.1.1
|
In consideration of the entry by the Joint Bookrunners and Underwriters into this Agreement, the sufficiency of which is acknowledged, each Guarantor irrevocably and unconditionally, subject to the Limitation Act, Chapter 163 of Singapore:
|
(a)
|
guarantees to each Joint Bookrunner and Underwriter as principal obligor, the due and punctual performance and observance by the Sponsor of all of its representations, warranties, obligations and undertakings under this Agreement; and
|
537518-4-8594-v7.4
|
‑
99
‑
|
17-40684037
|
(b)
|
indemnifies each Joint Bookrunner and Underwriter against all losses, damages, costs and expenses incurred by each Joint Bookrunner and Underwriter arising from the failure by the Sponsor to perform and/or observe any of its representations, warranties, obligations and undertakings under this Agreement.
|
14.1.2
|
If the Sponsor fails for any reason whatsoever punctually to pay any amount to any of the Joint Bookrunners and Underwriters under this Agreement, the Guarantors shall cause each and every such payment to be made as if the Guarantors instead of the Sponsor were expressed to be the primary obligors under this Agreement and not merely as surety (but without affect the nature of the Sponsor obligations) such that the respective Joint Bookrunner and Underwriter shall receive the same amounts as would have been receivable had such payments been made by the Sponsor.
|
14.1.3
|
If any payment received by the Sponsor under the provisions of this Agreement shall (whether on the subsequent bankruptcy, insolvency or corporate reorganisation of the Sponsor or, without limitation, on any other event) be avoided or set aside for any reason, such payment shall not be considered as discharging or diminishing the liability of the Guarantors and this guarantee shall continue to apply as if such payment had at all times remained owing by the Sponsor, provided that the obligations of the Sponsor and/or the Guarantors under this Clause 14 shall, as regards any payments made to the Sponsor which is avoided or set aside, be contingent upon such payment being reimbursed to the Sponsor or other persons entitled through the Sponsor.
|
14.1.4
|
Each Guarantor hereby agrees that its obligations under this Clause 14 shall be unconditional and that the Guarantors shall be fully liable irrespective of the validity, regularity, legality or enforceability against the Sponsor of, or of any defence or counter-claim whatsoever available to the Sponsor in relation to, its obligations under this Agreement, whether or not any action has been taken to enforce the same or any judgment obtained against the Sponsor, whether or not any of the other provisions of this Agreement have been modified, whether or not any time, indulgence, waiver, authorisation or consent has been granted to the Sponsor by any of the Joint Bookrunners and Underwriters, whether or not there have been any dealings or transactions between the Sponsor and any or all of the Joint Bookrunners or Underwriters, whether or not the Sponsor has been dissolved, liquidated, merged, consolidated, bankrupted or has changed its status, functions, control or ownership, whether or not the Sponsor has been prevented from making payment by foreign exchange provisions applicable at its place of registration or incorporation and whether or not any other circumstances have occurred which might otherwise constitute a legal or equitable discharge of or defence to a guarantor. Accordingly the validity of this guarantee shall not be affected by reason of any invalidity, irregularity, illegality or unenforceability of all or any of the obligations of the Sponsor under this Agreement and this guarantee shall not be discharged nor shall the liability of the Guarantors under this Agreement be affected by any act, thing or omission or means whatever whereby its liability would not have been discharged if it had been the principal debtor.
|
537518-4-8594-v7.4
|
‑
100
‑
|
17-40684037
|
14.2
|
Waiver
|
14.3
|
Payment
|
14.3.1
|
in respect of any amounts paid by it under this guarantee, exercise any rights of subrogation or contribution or, without limitation, any other right or remedy which may accrue to it in respect of or as a result of any such payment; or
|
14.3.2
|
in respect of any other moneys for the time being due to the Guarantors by the Sponsor, claim payment thereof or exercise any other right or remedy,
|
14.4
|
Representations and Warranties of the Guarantors
|
14.4.1
|
none of the Guarantors is in liquidation in any jurisdiction, nor has any step or action been taken or threatened, nor any resolution passed, nor legal proceedings started or threatened, nor orders made in any jurisdiction, nor any petitions presented, for the winding up or dissolution of any of the Guarantors, or for any of them to enter into any compromise, arrangement, scheme of arrangement or composition for the benefit of creditors, or for the appointment of a receiver, administrator, receiver and manager, judicial manager, trustee, provisional supervisor, provisional liquidator, liquidator or similar or analogous officer or
|
537518-4-8594-v7.4
|
‑
101
‑
|
17-40684037
|
14.4.2
|
Linda Bren is the beneficial owner of a 100% limited partnership interest (the “PBren Interest”) in PBren Investments, L.P., a limited partnership organized and existing under the laws of the State of Delaware. The PBren Interest is 100% (one hundred percent) of the limited partnership interests in PBren Investments, L.P. The legal owner thereof is Richard Bren, Trustee of the Linda Bren 2017 Trust, which trust is revocable, and all of whose property may be withdrawn, by Linda Bren. Richard Bren, as Trustee of the Linda Bren 2017 Trust, is the lawful owner of, and has good and marketable title to 100% of the limited partnership interests in PBren Investments, L.P., free and clear of any and all Encumbrances;
|
14.4.3
|
Charles J. Schreiber, Jr is the beneficial owner of a 98.5075% partnership interest (the "
Schreiber Interest
") in Schreiber Real Estate Investments L.P., a limited partnership organized under the laws of the State of Delaware. The remaining limited partnership interests in the Schreiber Real Estate Investments L.P. are owned by Mr. Schreiber’s adult children. The Schreiber Interest represents 98.5075% of the outstanding partnership interests in Schreiber Real Estate Investments L.P. Charles J. Schreiber, Jr is the lawful owner of, and has good and marketable title to his 98.5075% interests in Schreiber Real Estate Investments L.P., free and clear of any and all Encumbrances; and
|
14.4.4
|
each of PBren Investments, L.P. and Schreiber Real Estate Investments L.P. is the legal owner of a 50.0% limited liability company interest (the "
KBS RA Interests
") in KBS RA, a limited liability company organized and existing under the laws of the State of Delaware. The KBS RA Interests represent 100% (hundred percent) of the outstanding membership interests in KBS RA. PBren Investments, L.P. and Schreiber Real Estate Investments L.P. are the lawful owners of, and have good and marketable title to each of their respective 50% interests in KBS RA, free and clear of any and all Encumbrances.
|
15.
|
AMENDMENTS AND VARIATIONS
|
537518-4-8594-v7.4
|
‑
102
‑
|
17-40684037
|
Joint Bookrunners and Underwriters
|
Number of Offering Units
and Cornerstone Units
(Column 1)
|
Proportion of Over-
Allotment Units
|
||
|
|
|
|
|
DBS Bank Ltd.
|
|
242,106,000
|
|
-
|
Merrill Lynch (Singapore)
Pte. Ltd.
|
|
113,326,000
|
|
100%
|
China International Capital
Corporation (Singapore) Pte.
Limited
|
|
567,000
|
|
-
|
Credit Suisse (Singapore)
Limited
|
|
36,058,000
|
|
-
|
Maybank Kim Eng
Securities Pte. Ltd.
|
|
87,570,000
|
|
-
|
Oversea-Chinese Banking
Corporation Limited
|
|
36,058,000
|
|
-
|
Total
|
|
515,685,000
|
|
100%
|
537518-4-8594-v7.4
|
‑
103
‑
|
17-40684037
|
537518-4-8594-v7.4
|
‑
104
‑
|
17-40684037
|
1.
|
KBS REIT Properties III LLC wishes to restrict its right to deal in the units in Prime US REIT (the "
Units
") in which it legally and/or beneficially, directly or indirectly owns or will own, on the date of admission (the "
Listing Date
") of Prime US REIT to the Official List of Singapore Exchange Securities Trading Limited (the "
KBS REIT Properties III LLC Lock-up Units
"), in accordance with the terms in this letter agreement. Terms used, but not otherwise defined herein, have the meanings ascribed thereto in the final prospectus to be dated on or around 8 July 2019
and to be registered with the Monetary Authority of Singapore in connection with the Offering (the "
Prospectus
").
|
2.
|
In consideration of S$1.00, the receipt and sufficiency of which is hereby acknowledged, KBS REIT Properties III LLC undertakes to the Joint Bookrunners and Underwriters that it will not, subject to the exceptions set out in paragraph 3 below, without the prior written consent of the Joint Bookrunners and Underwriters (such consent not to be
|
537518-4-8594-v7.4
|
‑
105
‑
|
17-40684037
|
(a)
|
offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, hypothecate, grant security over, encumber or otherwise dispose of or transfer, any or all of its effective interest in the KBS REIT Properties III LLC Lock-up Units (including any securities convertible into or exercisable or exchangeable for any KBS REIT Properties III LLC Lock-up Units or which carry rights to subscribe for or purchase any such KBS REIT Properties III LLC Lock-up Units);
|
(b)
|
enter into any swap, hedge or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the KBS REIT Properties III LLC Lock-up Units (including any securities convertible into or exercisable or exchangeable for any KBS REIT Properties III LLC Lock-up Units or which carry rights to subscribe for or purchase any such KBS REIT Properties III LLC Lock-up Units);
|
(c)
|
enter into any transaction (including a derivative transaction) or other arrangement with a similar economic effect to the foregoing sub-paragraph (a) or (b);
|
(d)
|
deposit any of its effective interest in the KBS REIT Properties III LLC Lock-up Units (including any securities convertible into or exercisable or exchangeable for any KBS REIT Properties III LLC Lock-up Units or which carry rights to subscribe for or purchase any such KBS REIT Properties III LLC Lock-up Units) in any depository receipt facility;
|
(e)
|
enter into a transaction which is designed or which may reasonably be expected to result in any of the above; or
|
(f)
|
publicly announce any intention to do any of the above,
|
537518-4-8594-v7.4
|
‑
106
‑
|
17-40684037
|
3.
|
The above restrictions in paragraph 2 shall not apply to prohibit KBS REIT Properties III, LLC from being able to:
|
(a)
|
create a charge over the KBS REIT Properties III LLC Lock-up Units or otherwise grant of security over or creation of any encumbrance over the KBS REIT Properties III LLC Lock-up Units, provided that such charge, security or encumbrance (i) cannot be enforced over any KBS REIT Properties III LLC Lock-up Units during the First Lock-up Period, and (ii) can only be enforced with respect to 50.0% of the effective interest in the KBS REIT Properties III LLC Lock-up Units during the Second Lock-up Period. The charge, security or encumbrance will only be created if the charge (such as a bank or financial institution) agrees that the charge, security or encumbrance over the KBS REIT Properties III LLC Lock-up Units cannot be enforced over 100.0% of the KBS REIT Properties III LLC Lock-up Unit during the First Lock-up Period and can only be enforced in relation to 50.0% of the effective interest in the KBS REIT Properties III LLC Lock-up Units during the Second Lock-up Period;
|
(b)
|
enter into any unit lending agreement with the Joint Bookrunners and Underwriters or any sale or transfer of the KBS REIT Properties III LLC Lock-up Units by KBS REIT Properties III LLC pursuant to the exercise of an over allotment option granted by the Unit Lender to the Joint Bookrunners and Underwriters; and
|
(c)
|
transfer the KBS REIT Properties III LLC Lock-up Units to and between KBS REIT Properties III LLC or any direct and indirect wholly-owned subsidiaries of KBS REIT Properties III LLC, provided that KBS REIT Properties III LLC shall, during the First Lock-up Period, maintain a direct or indirect interest in 100.0% of the KBS REIT Properties III LLC Lock-up Units and, during the Second Lock-up Period, maintain a direct or indirect interest in 50.0% of the KBS REIT Properties III LLC Lock-up Units and KBS REIT Properties III LLC has procured that such transferee subsidiaries have executed and delivered to the Joint Bookrunners and Underwriters undertakings to the effect that such transferee subsidiaries will comply with such restrictions so as to enable KBS REIT Properties III LLC to comply with the foregoing restrictions for the unexpired period of the First Lock-up Period and the Second Lock-up Period.
|
4.
|
For the avoidance of doubt, any Units returned to KBS REIT Properties III LLC pursuant to any unit lending agreement with the Joint Bookrunners and Underwriters shall be subject to the restrictions set out in this letter agreement as if they were KBS REIT Properties III LLC Lock-up Units.
|
5.
|
If, for any reason, the Offering is not completed within six months of the date of the Prospectus, this letter agreement shall be terminated immediately.
|
537518-4-8594-v7.4
|
‑
107
‑
|
17-40684037
|
6.
|
A person who is not a party to this letter agreement shall have no rights under the Contracts (Rights of Third Parties) Act (Chapter 53B of Singapore) to enforce any term of this letter agreement.
|
7.
|
This undertaking is given in favour of the Joint Bookrunners and Underwriters, and accordingly, may be enforced by the Joint Bookrunners and Underwriters. Without prejudice to any other rights or remedies which the Joint Bookrunners and Underwriters may have, we acknowledge and agree that damages may not be an adequate remedy for any breach of this undertaking and the Joint Bookrunners and Underwriters shall be entitled to seek the remedies of injunction, specific performance and other equitable relief for any threatened or actual breach of this undertaking.
|
8.
|
This letter agreement is governed by, and shall be construed in accordance with, the laws of Singapore.
|
9.
|
Both parties agree that the courts of Singapore are to have non-exclusive jurisdiction to settle any dispute (including claims for set-off and counter claims) which may arise in connection with the creation, validity, effect, interpretation, or performance of, or of legal relationships established by, this letter agreement or otherwise arising in connection with this letter agreement.
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
537518-4-8594-v7.4
|
‑
108
‑
|
17-40684037
|
1.
|
KBS Limited Partnership III ("
KBS LP III
") wishes to restrict its right to deal in its effective interest in the units in Prime US REIT (the "
Units
") which KBS REIT Properties III LLC legally and/or beneficially, directly or indirectly owns or will own, on the date of admission (the "
Listing Date
") of Prime US REIT to the Official List of Singapore Exchange Securities Trading Limited (the "
KBS REIT Properties III LLC Lock-up Units
"), in accordance with the terms in this letter agreement. Terms used, but not otherwise defined herein, have the meanings ascribed thereto in the final prospectus to be dated on or around 8 July 2019
and to be registered with the Monetary Authority of Singapore in connection with the Offering (the "
Prospectus
").
|
2.
|
In consideration of S$1.00, the receipt and sufficiency of which is hereby acknowledged, KBS LP III undertakes to the Joint Bookrunners and Underwriters that it will not, subject to the exceptions set out in paragraph 3 below, without the prior written consent of the
|
537518-4-8594-v7.4
|
‑
109
‑
|
17-40684037
|
(a)
|
offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, hypothecate, grant security over, encumber or otherwise dispose of or transfer, any or all of its effective interest in the KBS REIT Properties III LLC Lock-up Units (including any securities convertible into or exercisable or exchangeable for any KBS REIT Properties III LLC Lock-up Units or which carry rights to subscribe for or purchase any such KBS REIT Properties III LLC Lock-up Units);
|
(b)
|
enter into any swap, hedge or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the KBS REIT Properties III LLC Lock-up Units (including any securities convertible into or exercisable or exchangeable for any KBS REIT Properties III LLC Lock-up Units or which carry rights to subscribe for or purchase any such KBS REIT Properties III LLC Lock-up Units);
|
(c)
|
enter into any transaction (including a derivative transaction) or other arrangement with a similar economic effect to the foregoing sub-paragraph (a) or (b);
|
(d)
|
deposit any of its effective interest in the KBS REIT Properties III LLC Lock-up Units (including any securities convertible into or exercisable or exchangeable for any KBS REIT Properties III LLC Lock-up Units or which carry rights to subscribe for or purchase any such KBS REIT Properties III LLC Lock-up Units) in any depository receipt facility;
|
(e)
|
enter into a transaction which is designed or which may reasonably be expected to result in any of the above; or
|
(f)
|
publicly announce any intention to do any of the above,
|
3.
|
The above restrictions in paragraph 2 shall not apply to prohibit:
|
(a)
|
KBS LP III from being able to create a charge over the KBS REIT Properties III
|
537518-4-8594-v7.4
|
‑
110
‑
|
17-40684037
|
(b)
|
KBS REIT Properties III LLC from entering into any unit lending agreement with the Joint Bookrunners and Underwriters or any sale or transfer of the KBS REIT Properties III LLC Lock-up Units by KBS REIT Properties III LLC pursuant to the exercise of an over-allotment option granted by the Unit Lender to the Joint Bookrunners and Underwriters; and
|
(c)
|
KBS LP III from being able to transfer the KBS REIT Properties III LLC Lock-up Units to and between any direct and indirect wholly-owned subsidiaries of KBS LP III, provided that KBS LP III shall, during the First Lock-up Period, maintain a direct or indirect interest in 100.0% of the KBS REIT Properties III LLC Lock-up Units and, during the Second Lock-up Period, maintain a direct or indirect interest in 50.0% of the KBS REIT Properties III LLC Lock-up Units and KBS LP III has procured that such transferee subsidiaries have executed and delivered to the Joint Bookrunners undertakings to the effect that such transferee subsidiaries will comply with such restrictions so as to enable KBS LP III to comply with the foregoing restrictions for the unexpired period of the First Lock-up Period and the Second Lock-up Period.
|
4.
|
For the avoidance of doubt, any Units returned to KBS REIT Properties III LLC pursuant to any unit lending agreement with the Joint Bookrunners and Underwriters shall be subject to the restrictions set out in this letter agreement as if they were KBS REIT Properties III LLC Lock-up Units.
|
5.
|
If, for any reason, the Offering is not completed within six months of the date of the Prospectus, this letter agreement shall be terminated immediately.
|
6.
|
A person who is not a party to this letter agreement shall have no rights under the Contracts (Rights of Third Parties) Act (Chapter 53B of Singapore) to enforce any term of this letter agreement.
|
537518-4-8594-v7.4
|
‑
111
‑
|
17-40684037
|
7.
|
This undertaking is given in favour of the Joint Bookrunners and Underwriters, and accordingly, may be enforced by the Joint Bookrunners and Underwriters. Without prejudice to any other rights or remedies which the Joint Bookrunners and Underwriters may have, we acknowledge and agree that damages may not be an adequate remedy for any breach of this undertaking and the Joint Bookrunners and Underwriters shall be entitled to seek the remedies of injunction, specific performance and other equitable relief for any threatened or actual breach of this undertaking.
|
8.
|
This letter agreement is governed by, and shall be construed in accordance with, the laws of Singapore.
|
9.
|
Both parties agree that the courts of Singapore are to have non-exclusive jurisdiction to settle any dispute (including claims for set-off and counter claims) which may arise in connection with the creation, validity, effect, interpretation, or performance of, or of legal relationships established by, this letter agreement or otherwise arising in connection with this letter agreement.
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
537518-4-8594-v7.4
|
‑
112
‑
|
17-40684037
|
1.
|
KBS REIT Holdings III, LLC ("
KBS REIT Holdings III
") wishes to restrict its right to deal in its effective interest in the units in Prime US REIT (the "
Units
") which KBS Real Estate Investment Trust III, Inc. legally and/or beneficially, directly or indirectly owns or will own, on the date of admission (the "
Listing Date
") of Prime US REIT to the Official List of Singapore Exchange Securities Trading Limited (the "
KBS REIT Properties III LLC Lock-up Units
"), in accordance with the terms in this letter agreement. Terms used, but not otherwise defined herein, have the meanings ascribed thereto in the final prospectus to be dated on or around 8 July 2019
and to be registered with the Monetary Authority of Singapore in connection with the Offering (the "
Prospectus
").
|
537518-4-8594-v7.4
|
‑
113
‑
|
17-40684037
|
2.
|
In consideration of S$1.00, the receipt and sufficiency of which is hereby acknowledged, KBS REIT Holdings III undertakes to the Joint Bookrunners and Underwriters that it will not, subject to the exceptions set out in paragraph 3 below, without the prior written consent of the Joint Bookrunners and Underwriters (such consent not to be unreasonably withheld or delayed) during the period commencing from the date of issuance of the Units until the date falling six months after the Listing Date (both dates inclusive) (the "
First
Lock-up Period
"), directly or indirectly:
|
(a)
|
offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, hypothecate, grant security over, encumber or otherwise dispose of or transfer, any or all of its effective interest in the KBS REIT Properties III LLC Lock-up Units (including any securities convertible into or exercisable or exchangeable for any KBS REIT Properties III LLC Lock-up Units or which carry rights to subscribe for or purchase any such KBS REIT Properties III LLC Lock-up Units);
|
(b)
|
enter into any swap, hedge or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the KBS REIT Properties III LLC Lock-up Units (including any securities convertible into or exercisable or exchangeable for any KBS REIT Properties III LLC Lock-up Units or which carry rights to subscribe for or purchase any such KBS REIT Properties III LLC Lock-up Units);
|
(c)
|
enter into any transaction (including a derivative transaction) or other arrangement with a similar economic effect to the foregoing sub-paragraph (a) or (b);
|
(d)
|
deposit any of its effective interest in the KBS REIT Properties III LLC Lock-up Units (including any securities convertible into or exercisable or exchangeable for any KBS REIT Properties III LLC Lock-up Units or which carry rights to subscribe for or purchase any such KBS REIT Properties III LLC Lock-up Units) in any depository receipt facility;
|
(e)
|
enter into a transaction which is designed or which may reasonably be expected to result in any of the above; or
|
(f)
|
publicly announce any intention to do any of the above,
|
537518-4-8594-v7.4
|
‑
114
‑
|
17-40684037
|
3.
|
The above restrictions in paragraph 2 shall not apply to prohibit:
|
(a)
|
KBS REIT Holdings III from being able to create a charge over the KBS REIT Properties III LLC Lock-up Units or otherwise grant of security over or creation of any encumbrance over the KBS REIT Properties III LLC Lock-up Units, provided that such charge, security or encumbrance (i) cannot be enforced over any KBS REIT Properties III LLC Lock-up Units during the First Lock-up Period, and (ii) can only be enforced with respect to 50.0% of the effective interest in the KBS REIT Properties III LLC Lock-up Units during the Second Lock-up Period. The charge, security or encumbrance will only be created if the charge (such as a bank or financial institution) agrees that the charge, security or encumbrance over the KBS REIT Properties III LLC Lock-up Units cannot be enforced over 100.0% of the KBS REIT Properties III LLC Lock-up Unit during the First Lock-up Period and can only be enforced in relation to 50.0% of the effective interest in the KBS REIT Properties III LLC Lock-up Units during the Second Lock-up Period;
|
(b)
|
KBS REIT Properties III LLC from entering into any unit lending agreement with the Joint Bookrunners and Underwriters or any sale or transfer of the KBS REIT Properties III LLC Lock-up Units by KBS REIT Properties III LLC pursuant to the exercise of an over-allotment option granted by the Unit Lender to the Joint Bookrunners and Underwriters; and
|
(c)
|
KBS REIT Holdings III from being able to transfer the KBS REIT Properties III LLC Lock-up Units to and between any direct and indirect wholly-owned subsidiaries of KBS Limited Partnership III, provided that KBS Limited Partnership III shall, during the First Lock-up Period, maintain a direct or indirect interest in 100.0% of the KBS REIT Properties III LLC Lock-up Units and, during the Second Lock-up Period, maintain a direct or indirect interest in 50.0% of the KBS REIT Properties III LLC Lock-up Units and KBS REIT Holdings III has procured that such transferee subsidiaries have executed and delivered to the Joint Bookrunners undertakings to the effect that such transferee subsidiaries will comply with such restrictions so as to enable KBS REIT Holdings III to comply with the foregoing restrictions for the unexpired period of the First Lock-up Period and the Second Lock-up Period.
|
4.
|
For the avoidance of doubt, any Units returned to KBS REIT Properties III LLC pursuant to any unit lending agreement with the Joint Bookrunners and Underwriters shall be subject to the restrictions set out in this letter agreement as if they were KBS REIT Properties III LLC Lock-up Units.
|
5.
|
If, for any reason, the Offering is not completed within six months of the date of the Prospectus, this letter agreement shall be terminated immediately.
|
537518-4-8594-v7.4
|
‑
115
‑
|
17-40684037
|
6.
|
A person who is not a party to this letter agreement shall have no rights under the Contracts (Rights of Third Parties) Act (Chapter 53B of Singapore) to enforce any term of this letter agreement.
|
7.
|
This undertaking is given in favour of the Joint Bookrunners and Underwriters, and accordingly, may be enforced by the Joint Bookrunners and Underwriters. Without prejudice to any other rights or remedies which the Joint Bookrunners and Underwriters may have, we acknowledge and agree that damages may not be an adequate remedy for any breach of this undertaking and the Joint Bookrunners and Underwriters shall be entitled to seek the remedies of injunction, specific performance and other equitable relief for any threatened or actual breach of this undertaking.
|
8.
|
This letter agreement is governed by, and shall be construed in accordance with, the laws of Singapore.
|
9.
|
Both parties agree that the courts of Singapore are to have non-exclusive jurisdiction to settle any dispute (including claims for set-off and counter claims) which may arise in connection with the creation, validity, effect, interpretation, or performance of, or of legal relationships established by, this letter agreement or otherwise arising in connection with this letter agreement.
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
537518-4-8594-v7.4
|
‑
116
‑
|
17-40684037
|
1.
|
KBS Real Estate Investment Trust III, Inc. ("
KBS REIT III
") wishes to restrict its right to deal in the units in Prime US REIT (the "
Units
") in which it legally and/or beneficially, directly or indirectly owns or will own, on the date of admission (the "
Listing Date
") of Prime US REIT to the Official List of Singapore Exchange Securities Trading Limited (the "
KBS REIT Properties III LLC Lock-up Units
"), in accordance with the terms in this letter agreement. Terms used, but not otherwise defined herein, have the meanings ascribed thereto in the final prospectus to be dated on or around 8 July 2019
and to be registered with the Monetary Authority of Singapore in connection with the Offering (the "
Prospectus
").
|
2.
|
In consideration of S$1.00, the receipt and sufficiency of which is hereby acknowledged, KBS REIT III undertakes to the Joint Bookrunners and Underwriters that it will not, subject to the exceptions set out in paragraph 3 below, without the prior written consent
|
537518-4-8594-v7.4
|
‑
117
‑
|
17-40684037
|
(a)
|
offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, hypothecate, grant security over, encumber or otherwise dispose of or transfer, any or all of its effective interest in the KBS REIT Properties III LLC Lock-up Units (including any securities convertible into or exercisable or exchangeable for any KBS REIT Properties III LLC Lock-up Units or which carry rights to subscribe for or purchase any such KBS REIT Properties III LLC Lock-up Units);
|
(b)
|
enter into any swap, hedge or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the KBS REIT Properties III LLC Lock-up Units (including any securities convertible into or exercisable or exchangeable for any KBS REIT Properties III LLC Lock-up Units or which carry rights to subscribe for or purchase any such KBS REIT Properties III LLC Lock-up Units);
|
(c)
|
enter into any transaction (including a derivative transaction) or other arrangement with a similar economic effect to the foregoing sub-paragraph (a) or (b);
|
(d)
|
deposit any of its effective interest in the KBS REIT Properties III LLC Lock-up Units (including any securities convertible into or exercisable or exchangeable for any KBS REIT Properties III LLC Lock-up Units or which carry rights to subscribe for or purchase any such KBS REIT Properties III LLC Lock-up Units) in any depository receipt facility;
|
(e)
|
enter into a transaction which is designed or which may reasonably be expected to result in any of the above; or
|
(f)
|
publicly announce any intention to do any of the above,
|
537518-4-8594-v7.4
|
‑
118
‑
|
17-40684037
|
3.
|
The above restrictions in paragraph 2 shall not apply to prohibit:
|
(a)
|
KBS REIT III from being able to create a charge over the KBS REIT Properties III LLC Lock-up Units or otherwise grant of security over or creation of any encumbrance over the KBS REIT Properties III LLC Lock-up Units, provided that such charge, security or encumbrance (i) cannot be enforced over any KBS REIT Properties III LLC Lock-up Units during the First Lock-up Period, and (ii) can only be enforced with respect to 50.0% of the effective interest in the KBS REIT Properties III LLC Lock-up Units during the Second Lock-up Period. The charge, security or encumbrance will only be created if the charge (such as a bank or financial institution) agrees that the charge, security or encumbrance over the KBS REIT Properties III LLC Lock-up Units cannot be enforced over 100.0% of the KBS REIT Properties III LLC Lock-up Unit during the First Lock-up Period and can only be enforced in relation to 50.0% of the effective interest in the KBS REIT Properties III LLC Lock-up Units during the Second Lock-up Period;
|
(b)
|
KBS REIT Properties III LLC from entering into any unit lending agreement with the Joint Bookrunners and Underwriters or any sale or transfer of the KBS REIT Properties III LLC Lock-up Units by KBS REIT Properties III LLC pursuant to the exercise of an over-allotment option granted by the Unit Lender to the Joint Bookrunners and Underwriters; and
|
(c)
|
KBS REIT III from being able to transfer the KBS REIT Properties III LLC Lock-up Units to and between any direct and indirect wholly-owned subsidiaries of KBS REIT III, provided that KBS REIT III shall, during the First Lock-up Period, maintain a direct or indirect interest in 100.0% of the KBS REIT Properties III LLC Lock-up Units and, during the Second Lock-up Period, maintain a direct or indirect interest in 50.0% of the KBS REIT Properties III LLC Lock-up Units and KBS REIT III has procured that such transferee subsidiaries have executed and delivered to the Joint Bookrunners and Underwriters undertakings to the effect that such transferee subsidiaries will comply with such restrictions so as to enable KBS REIT III to comply with the foregoing restrictions for the unexpired period of the First Lock-up Period and the Second Lock-up Period.
|
4.
|
For the avoidance of doubt, any Units returned to KBS REIT Properties III LLC pursuant to any unit lending agreement with the Joint Bookrunners and Underwriters shall be subject to the restrictions set out in this letter agreement as if they were KBS REIT Properties III LLC Lock-up Units.
|
5.
|
If, for any reason, the Offering is not completed within six months of the date of the Prospectus, this letter agreement shall be terminated immediately.
|
537518-4-8594-v7.4
|
‑
119
‑
|
17-40684037
|
6.
|
A person who is not a party to this letter agreement shall have no rights under the Contracts (Rights of Third Parties) Act (Chapter 53B of Singapore) to enforce any term of this letter agreement.
|
7.
|
This undertaking is given in favour of the Joint Bookrunners and Underwriters, and accordingly, may be enforced by the Joint Bookrunners and Underwriters. Without prejudice to any other rights or remedies which the Joint Bookrunners and Underwriters may have, we acknowledge and agree that damages may not be an adequate remedy for any breach of this undertaking and the Joint Bookrunners and Underwriters shall be entitled to seek the remedies of injunction, specific performance and other equitable relief for any threatened or actual breach of this undertaking.
|
8.
|
This letter agreement is governed by, and shall be construed in accordance with, the laws of Singapore.
|
9.
|
Both parties agree that the courts of Singapore are to have non-exclusive jurisdiction to settle any dispute (including claims for set-off and counter claims) which may arise in connection with the creation, validity, effect, interpretation, or performance of, or of legal relationships established by, this letter agreement or otherwise arising in connection with this letter agreement.
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
537518-4-8594-v7.4
|
‑
120
‑
|
17-40684037
|
By:
|
/s/ Sandip Talukdar
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
PBren Investments, LLC, as general partner
|
By:
|
PBCS Management, LLC, a Manager
|
By:
|
/s/Charles J. Schreiber, Jr.
|
By:
|
Schreiber Investments, LLC, as general partner
|
By:
|
/s/Charles J. Schreiber, Jr.
|
By:
|
Schreiber Real Estate Investments, L.P., a Manager
|
By:
|
Schreiber Investments, LLC, as general partner
|
By:
|
/s/Charles J. Schreiber, Jr.
|
By:
|
/s/ Tan Jeh Wuan
|
By:
|
/s/ Siah Geok Wah
|
By:
|
/s/ Lindsey Lin
|
By:
|
/s/ Tan Kuan Ern
|
By:
|
/s/ Adrian Yeo
|
By:
|
/s/ Audrey Lam
|
By:
|
/s/ David Cheng
|
By:
|
/s/ Andrew Teo
|
537518-4-8565-v9.0
|
‑
1
‑
|
17-40684037
|
1.
|
Advance Funding
|
(a)
|
Funding
. DBS, BAML, CS, Maybank and OCBC shall severally (and not jointly or jointly and severally) fund the Advance Funding Amount two business days prior to the Completion Date or such other date as may be agreed by the parties hereto (the "
Funding Date
"), Singapore time, respectively to the Advance Funding Account in the breakdown set out below:
|
Joint Bookrunners and Underwriters
|
Advance Funding Amount
(US$)
|
DBS Bank Ltd.
|
108,175,733.86
|
Merrill Lynch (Singapore) Pte. Ltd.
|
50,635,449.89
|
Credit Suisse (Singapore) Limited
|
35,310,943.51
|
Maybank Kim Eng Securities Pte. Ltd.
|
49,126,833.10
|
Oversea-Chinese Banking Corporation
Limited
|
16,111,279.51
|
(b)
|
Each of the Manager and DBS Trustee Limited (in its capacity as trustee of Prime US REIT) (the "
REIT Trustee
"), acknowledges and agrees that (i) it will directly or indirectly benefit from such funding to facilitate the offering of units representing undivided interests in Prime US REIT (the "
Offering
"), (ii) it has received valuable consideration for executing this Side Letter and (iii) the Advance Funding Parties have informed it that they would not fund the Advance Funding Amount to the REIT Trustee without the execution and delivery of this Side Letter by the REIT Trustee and the Manager. For the purpose of this Side Letter, "
Advance Funding Account
" shall mean the following non-interest bearing account maintained by the Manager at DBS Bank Ltd. with the following details:
|
537518-4-8565-v9.0
|
‑
2
‑
|
17-40684037
|
(c)
|
Conditions to Funding.
The obligation of the Advance Funding Parties to remit the Advance Funding Amount on the Funding Date shall be conditional upon the receipt by each of the Advance Funding Parties of all of the documents and evidence, and satisfaction of all other conditions, set out in Schedule B below (save for any waived by all the Advance Funding Parties).
|
(d)
|
Failure to Fully Fund
. If any Advanced Funding Party ("
Defaulting Funding Party
") fails to remit the full amount of its proportion of the Advance Funding Amount to the Advance Funding Account by the Funding Date, then:
|
(i)
|
none of the other Advance Funding Parties will be obliged to fund their respective proportion of the Advance Funding Amount;
|
(ii)
|
the REIT Trustee and the Manager must immediately on demand from each Advance Funding Party refund to that Advance Funding Party the amount of the Advance Funding Amount which that Advance Funding Party had remitted to the Advance Funding Account under this Clause 1, and DBS Bank Ltd. will (and is hereby irrevocably authorised and directed by the REIT Trustee and the Manager to), as soon as reasonably practicable, deduct the amount of that refund from the Advance Funding Account and remit it to that Advanced Funding Party by wire transfer of immediately available funds (in United States dollars) to the account specified by that Advance Funding Party; and
|
(iii)
|
the REIT Trustee must immediately pay to each Advance Funding Party (other than a Defaulting Funding Party) its Advance Funding Fee accrued from the Funding Date up to (but excluding) the date of that Advance Funding Party's receipt of such refund, together with all other sums owing from the REIT Trustee to that Advance Funding Party.
|
(e)
|
Unlawfulness of Funding Cancelling Commitments
. If, after the date of this Side Letter, it is or will become unlawful or will become unlawful in any jurisdiction for an Advance Funding Party to perform any of its obligations as contemplated by this Side Letter or to fund or maintain its participation in the Advance Funding Amount, no Advance Funding Party shall be obligated to make available its participation in the Advance Funding Amount to the REIT Trustee and (if any part of the Advance Funding Amount has been made available to the REIT Trustee) the Advance Funding Parties may cancel their respective commitments and require immediate repayment of the Advance Funding Amount or such part that has been advanced together with all accrued Advance Funding Fee outstanding and interest due and payable at the Applicable Rate (as defined in Clause 2 below) and any other outstanding sums and, if not repaid by the close of business (in Singapore) on the Business Day (in Singapore) after such amounts first become due, at the Default Rate (as defined in Clause 19 below). An Advance Funding Party must immediately notify all the other Advance Funding Parties and the REIT Trustee if it becomes
|
537518-4-8565-v9.0
|
‑
3
‑
|
17-40684037
|
(f)
|
aware that it is unlawful in any relevant jurisdiction for that Advance Funding Party to perform any of its obligations under this Side Letter or to fund or maintain its participation in the Advance Funding Amount.
|
2.
|
Advance Funding Fees
|
3.
|
Obligation to Repay
|
(a)
|
Repayment Obligations if Listing Occurs
. If the Units in Prime US REIT are listed (the "
Listing
") on Singapore Exchange Securities Trading Limited (the "
SGX-ST
") by 2:00 p.m. (Singapore time) on 19 July 2019, or such other date and time as may be agreed by the Advance Funding Parties in their sole discretion (the "
Listing Date
"), the Aggregate Advance Funding Obligations shall be repayable immediately by the REIT Trustee and the Manager to the Advance Funding Parties pro rata in accordance with their respective Advance Funding Amounts, and the REIT Trustee agrees to cause, and hereby irrevocably authorises and directs, the Manager to set aside a sufficient portion of Listing proceeds to be applied towards repayment of the Aggregate Advance Funding Obligations. The REIT Trustee and the Manager agree that the Advance Funding Parties and/or the Joint Bookrunners and Underwriters may set off the Aggregate Advance Funding Obligations against (and retain, for payment of the Aggregate Advance Funding Obligations, from) the proceeds of the Offering and the Cornerstone Units before remitting any further proceeds to the REIT Trustee, or into the non-interest bearing account opened by the Manager and operated by DBS Bank Ltd. (as the Receiving Bank) and designated as the "PRIME USD Unit Issue Account" solely for the purpose of depositing proceeds from the Offering and the Cornerstone Units (the "
Receiving Bank
"), pursuant to the terms of the Singapore Offer Agreement and the Placement Agreement, respectively. For the avoidance of doubt, the setting off of the Aggregate Advance Funding Obligations against the proceeds of the Offering and the Cornerstone Units pursuant to this Clause 3(a) shall satisfy the obligations of the REIT Trustee under this Side Letter to repay the Aggregate Advance Funding Obligations, to the extent of the amount so set off and paid to the Advance Funding Parties.
|
(b)
|
Repayment Obligation if Listing Does Not Occur
. If, for any reason, the Listing does not occur by the Listing Date, then the REIT Trustee shall immediately repay the Aggregate Advance Funding Obligations to the Advance
|
537518-4-8565-v9.0
|
‑
4
‑
|
17-40684037
|
(c)
|
Funding Parties pro rata in accordance with their respective Advance Funding Amounts and procure the repayment of such amounts in accordance with the terms of the closing escrow agreement to be entered into on or around 17 July 2019 between the relevant parties substantially in the form set out in Schedule C (the “
Escrow Agreement
”). If, for any reason, the Aggregate Advance Funding Obligations are not repaid in full by the Listing Date, the REIT Trustee agree to repay or procure the repayment to each Advance Funding Party of all that Advance Funding Party's unpaid portions of the Aggregate Advance Funding Obligations by the close of business (in Singapore) on the next Business Day (in Singapore) by wire transfer of immediately available funds (in United States dollars) to the account specified by that Advance Funding Party.
|
(d)
|
Overdue Amounts
: If the REIT Trustee fails to repay the Aggregate Advance Funding Obligations or any part thereof when due, it shall be liable to pay the Advance Funding Parties interest on such amount at the Default Rate from the due date until the date of repayment of the overdue amount; and the Advance Funding Parties shall be entitled to exercise all remedies available to them at law or in equity and the REIT Trustee shall, in addition to the Advance Funding Amount and the Advance Funding Fee and interest on overdue sums, be obligated to pay all out-of-pocket costs and expenses (including legal fees on the full indemnity basis) incurred by the Advance Funding Parties to enforce such obligations of the REIT Trustee under this Side Letter (the Advance Funding Amounts, Advance Funding Fee and such costs and expenses and all other sums payable by the REIT Trustee are, collectively, the "
Aggregate Advance Funding Obligations
"). Interest (if unpaid) on any amount (whether overdue or otherwise) will be compounded with that amount at the end of each calendar month but will remain immediately due and payable.
|
(e)
|
Time of the Essence
. The parties hereto agree that time is of the essence with respect to the funding and repayment of the Advance Funding Amount and the Aggregate Advance Funding Obligations, and the REIT Trustee shall have the responsibility of securing all consents and approvals and taking all necessary steps to ensure that the repayment is made to the relevant parties in United States dollars in the most expeditious manner and in any event no later than the due date required by this Clause 3.
|
(f)
|
Pari Passu
Payment to the Advance Funding Parties.
The parties to this Side Letter agree, and the REIT Trustee undertakes to the Advance Funding Parties that, all payments of the Aggregate Advance Funding Obligations must be made to the Advance Funding Parties on a
pari passu
basis, proportionate to their respective shares of the Aggregate Advance Funding Obligations,
|
4.
|
Manager's Undertaking
|
537518-4-8565-v9.0
|
‑
5
‑
|
17-40684037
|
5.
|
Gross-up
|
6.
|
Goods and Services Tax ("GST")
|
7.
|
Indemnity
|
8.
|
Currency Indemnity
|
(a)
|
making or filing a claim or proof against the REIT Trustee or the Manager; or
|
(b)
|
obtaining or enforcing an order, judgment or award in relation to any litigation or arbitration proceedings,
|
537518-4-8565-v9.0
|
‑
6
‑
|
17-40684037
|
9.
|
General Currency Indemnity
|
10.
|
Obligations Unconditional
|
(a)
|
To the fullest extent permitted by applicable law, except as expressly set forth in this Side Letter or as otherwise agreed by all parties in writing, the liability of the REIT Trustee and the Manager hereunder shall not be impaired, abated, deferred, diminished, modified, released, terminated or discharged, in whole or in part, or otherwise affected, by any event, condition, occurrence, circumstance, proceeding, action or failure to act, with or without notice to, or the knowledge or consent of, the REIT Trustee or the Manager, including, without limitation:
|
(i)
|
any amendment, modification, or extension or termination of either of the Underwriting Agreements or any of the other documents executed in connection therewith (collectively, the "
Transaction Documents
");
|
(ii)
|
any extensions of time for performance, whether in whole or in part, of any obligation given prior to or after default under any of the Transaction Documents;
|
(iii)
|
any guarantee, indemnity or other agreement now or hereafter executed by the REIT Trustee, the Manager or any other person and any payment thereunder;
|
(iv)
|
any waiver of or assertion or enforcement or failure or refusal to assert or enforce, in whole or in part, any payment of any obligation, claim, cause of action, right or remedy which an Advance Funding Party may, at any time, have under any Transaction Documents or with respect to the REIT Trustee or the Manager;
|
(v)
|
any act or thing or omission or delay to do any act or thing which may in any manner or to any extent vary the risk of the REIT Trustee or the Manager or which would otherwise operate as a discharge of the REIT Trustee or the Manager as a matter of law;
|
537518-4-8565-v9.0
|
‑
7
‑
|
17-40684037
|
(vi)
|
the release of any indemnitor or guarantor for the payment of any obligation, whether by operation of law or otherwise (except by reason of the payment in full of such party's obligations under this Side Letter);
|
(vii)
|
except in connection with the demand required by Clauses 1(c), 4, 8 or 9 above, the failure to give the REIT Trustee and/or the Manager any notice whatsoever under this Side Letter;
|
(viii)
|
any right, power or privilege that an Advance Funding Party may now or hereafter have against the REIT Trustee, the Manager or any other person, entity or collateral;
|
(ix)
|
any assignment, conveyance, merger or other transfer, voluntary or involuntary (whether by operation of law or otherwise) of all or any part of the REIT Trustee's and/or the Manager's interests in or rights under the Transaction Documents;
|
(x)
|
any assignment, conveyance, merger or other transfer, voluntary or involuntary (whether by operation of law or otherwise), of all or part of the interest or rights of an Advance Funding Party under the Transaction Documents;
|
(xi)
|
any accuracy or inaccuracy of any representations or warranties made by any person in any Transaction Documents;
|
(xii)
|
any recovery as a result of the exercise of an Advance Funding Party's rights or remedies under any of the Transaction Documents (other than to the extent of such recovery);
|
(xiii)
|
the taking, variation, compromise, exchange, renewal or release of, or refusal or neglect to perfect, execute, take up or enforce, any rights against, or security over assets of, any person or any non-presentation or non-observance of any formality or other requirement in respect of any instrument or any failure to realise the full value of any security;
|
(xiv)
|
any incapacity or lack of power, authority or legal personality of or dissolution or change in the members or status of the REIT Trustee, the Manager or any other person;
|
(xv)
|
any unenforceability, illegality or invalidity of any obligation of any person under any Transaction Document or any other document or security;
|
(xvi)
|
any insolvency or similar proceedings; or
|
(xvii)
|
this Side Letter or any Transaction Document not being executed by or binding upon any other party.
|
(b)
|
None of the REIT Trustee's and/or the Manager's obligations to make payment in accordance with this Side Letter nor any remedy for the enforcement thereof shall be impaired, modified, changed, stayed, released or limited in any manner by any impairment, modification, change, release, limitation or stay of the
|
537518-4-8565-v9.0
|
‑
8
‑
|
17-40684037
|
11.
|
Waiver
|
12.
|
Rights and Remedies
|
13.
|
Successors and Assigns
|
537518-4-8565-v9.0
|
‑
9
‑
|
17-40684037
|
14.
|
Rights of Third Parties
|
15.
|
Severability
|
16.
|
Notices
|
(a)
|
Form
.
All notices, certificates, consents, approvals, waivers and other communications in connection with this Side Letter must be in writing, signed by an authorised officer of the sender and marked for attention as set out below in Schedule A below (in the case of the REIT Trustee or the Manager), or in clause 11 of the Singapore Offer Agreement and/or clause 11 of the Placement Agreement (in the case of an Advance Funding Party) or, if the addressee has notified the sender otherwise, then marked for attention in the way last notified.
|
(b)
|
Delivery
. They must be left at or sent by prepaid post to the address of the addressee, as set out in Schedule A below (in the case of the REIT Trustee or the Manager) or clause 11 of the Singapore Offer Agreement and/or clause 11 of the Placement Agreement (in the case of an Advance Funding Party); or such other address notified by the addressee to the sender.
|
(c)
|
Effectiveness
. Every notice or communication sent in accordance with this Clause 16 shall be effective upon receipt by the addressee, except in the case of any notice or communication sent by fax, which shall be effective upon despatch by the sender.
|
17.
|
Governing Law
|
18.
|
Jurisdiction
|
537518-4-8565-v9.0
|
‑
10
‑
|
17-40684037
|
(a)
|
Jurisdiction of Singapore courts
. All the parties to this Side Letter agree that the courts of Singapore are to have non-exclusive jurisdiction to settle any dispute (including claims for set-off and counter claims) which may arise in connection with the creation, validity, effect, interpretation, or performance of, or of legal relationships established by, this Side Letter or otherwise arising in connection with this Side Letter and for such purposes irrevocably submit to the jurisdiction of the Singapore courts.
|
(b)
|
Serving Documents
. Without preventing any other method of service, any document in a court action may be served on a party by being delivered to or left at that party's address for service of notices under Clause 16 above.
|
(c)
|
Waiver of Immunity
. To the extent that the REIT Trustee or the Manager has or hereafter may acquire any immunity (sovereign or otherwise) from any legal action, suit or proceeding, from jurisdiction of any court or from set-off or any legal process (whether service or notice, attachment in aid or otherwise) with respect to itself or any of its property, each of them hereby irrevocably waives and agrees not to plead or claim such immunity in respect of its obligations under this Side Letter.
|
19.
|
Payments
|
20.
|
Entire Agreement
|
21.
|
Binding Agreement
|
22.
|
Counterparts
|
23.
|
Termination
|
537518-4-8565-v9.0
|
‑
11
‑
|
17-40684037
|
(i)
|
if the termination of this Side Letter occurs prior the remittance of the Advance Funding Amount to the Advance Funding Account, any commitment or obligation of the Advance Funding Parties to fund the Advance Funding Amount shall simultaneously terminate without any further action,
without prejudice to the obligations of the REIT Trustee and the Manager in this Side Letter, including but not limited to their obligation to repay any Aggregate Advance Funding Obligations immediately to the Advance Funding Parties; or
|
(ii)
|
if the termination of this Side Letter occurs after the remittance of the Advance Funding Amount to the Advance Funding Account, the Trustee shall immediately repay the Aggregate Advance Funding Obligations to the Advance Funding Parties pro rata in accordance with their respective Advance Funding Amounts and where applicable, procure the repayment of such amounts in accordance with the terms of the Escrow Agreement entered to be entered into the date hereof between that relevant parties substantially in the form set out in Schedule C.
|
24.
|
Several Liabilities and Rights of the Advance Funding Parties
|
25.
|
Limitation of Liability of REIT Trustee
|
(a)
|
Notwithstanding any provision to the contrary in this Side Letter, the parties hereto agree and acknowledge that DBS Trustee Limited ("
DBS Trustee
") has entered into this Side Letter in its capacity as trustee of Prime US REIT and not in its personal capacity and all references to the REIT Trustee in this Side Letter shall be construed accordingly. As such, notwithstanding any provision to the contrary in this Side Letter, DBS Trustee has assumed all obligations under this Side Letter in its capacity as trustee of Prime US REIT and not in its personal capacity and any liability of or indemnity, covenant, undertaking, representation and/or warranty given by the REIT Trustee under this Side Letter is given by DBS Trustee in its capacity as trustee of Prime US REIT and not in its personal capacity and any power and right conferred on any receiver, attorney, agent and/or delegate is limited to the assets of Prime US REIT over which DBS Trustee in its capacity as trustee of Prime US RIET has recourse and shall not
|
537518-4-8565-v9.0
|
‑
12
‑
|
17-40684037
|
(b)
|
Notwithstanding any provision to the contrary in this Side Letter, the parties hereby acknowledge and agree that the REIT Trustee's obligations under this Side Letter will be solely the corporate obligations of DBS Trustee and that the parties shall not have any recourse against the shareholders, directors, officers or employees of DBS Trustee for any claims, losses, damages, liabilities or other obligations whatsoever in connection with any of the transactions contemplated by the provisions of this Side Letter. The foregoing shall not restrict or prejudice the rights or remedies of the parties under law or equity whether in connection with any gross negligence, fraud or breach of trust of DBS Trustee.
|
(c)
|
For the avoidance of doubt, any legal action or proceedings commenced against the REIT Trustee whether in Singapore or elsewhere pursuant to this Side Letter shall be brought against DBS Trustee in its capacity as the trustee of Prime US REIT and not in its personal capacity. The foregoing shall not restrict or prejudice the rights or remedies of the parties under law or equity whether in connection with any gross negligence, fraud or breach of trust of DBS Trustee.
|
(d)
|
This Clause 25 shall survive the termination or rescission of this Side Letter.
|
(e)
|
The provisions of this Clause 25 shall apply,
mutatis mutandis
, to any notice, certificate or other document which the REIT Trustee issues under or pursuant to this Side Letter, as if expressly set out in such notice, certificate or document.
|
537518-4-8565-v9.0
|
‑
13
‑
|
17-40684037
|
By:
|
/s/ Joyce Chua /s/ Celine Koh
|
Name:
|
Joyce Chua Celine Koh
|
Title:
|
Manager, Corporate Trust Manager, Corporate Trust
|
By:
|
/s/ Sandip Talukdar
|
Name:
|
Sandip Talukdar
|
Title:
|
Chief Financial Officer
|
By:
|
/s/ Tan Jeh Wuan
|
Name:
|
Tan Jeh Wuan
|
Title:
|
Managing Director, Head of Capital Markets, Singapore
|
By:
|
/s/ Siah Geok Wah
|
Name:
|
Siah Geok Wah
|
Title:
|
Managing Director
|
By:
|
/s/ Angeline Aw /s/ Adrian Yeo
|
Name:
|
Angeline Aw Adrian Yeo
|
Title:
|
Manager Director Director
|
By:
|
/s/ Audrey Lam
|
Name:
|
Audrey Lam
|
Title:
|
Head
|
By:
|
/s/ David Cheng
|
Name:
|
David Cheng
|
Title:
|
Head, Corporate Finance
|
By:
|
/s/ Andrew Teo
|
Name:
|
Andrew Teo
|
Title:
|
Head, Singapore Coverage
|
1.
|
A copy of the Constitution of the REIT Trustee, certified as a true copy by its authorised signatory(ies) of the REIT Trustee.
|
2.
|
A copy of the Constitution of the Manager, certified as a true copy by a director or the secretary of the Manager.
|
3.
|
A copy of the Trust Deed and any agreements, deeds or documents amending, varying or supplementing any term of the Trust Deed, each certified as a true copy by a director or the secretary of the Manager.
|
4.
|
A copy of the resolutions of the board of directors of the REIT Trustee authorising specified persons to execute the Transaction Documents to which it is a party, and all notices, authorisations and other documents to be signed by it under or in connection with any Transaction Document, certified as a true copy by its authorised signatories.
|
5.
|
A copy of the resolutions of the board of directors of the Manager approving the terms of, the transactions contemplated by and the entry by the REIT Trustee and the Manager into the Transaction Documents to which the REIT Trustee or the Manager (as the case may be) is a party, the issue by the Manager of the Manager's Written Directions (as defined below), and authorising specified persons to execute the Written Directions, the Underwriting Agreements, the Side Letter and all notices, authorisations and other documents to be signed by it under or in connection with any Transaction Documents, and, in each case, the transactions contemplated thereunder, certified as a true copy by its director or secretary.
|
6.
|
A copy of the written instructions from the Manager to the REIT Trustee directing the REIT Trustee to borrow the Advance Funding Amount and enter into this Side Letter (and any other Transaction Documents to which it is to be party) (
Written Directions
).
|
7.
|
A specimen of the signature of each person authorised to sign the Side Letter on behalf of the REIT Trustee or the Manager (each, an
Authorised Signatory
).
|
8.
|
A certificate of an Authorised Signatory of the REIT Trustee confirming that:
|
(a)
|
borrowing the Advance Funding Amount and its execution and performance of the Transaction Documents to which it is a party would not cause any borrowing limit binding on it or Prime US REIT to be exceeded or breached or any covenants, obligations or documents by which it or Prime US REIT is bound to be breached;
|
(b)
|
none of the charges registered against the REIT Trustee at the Accounting and Corporate Regulatory Authority of Singapore relates to any assets of Prime US REIT; and
|
537518-4-8565-v9.0
|
‑
22
‑
|
17-40684037
|
(c)
|
each copy document relating to it specified in this Schedule is correct, complete and in full force and effect as at a date no earlier than the date of this Side Letter (or such other date prescribed by the Advance Funding Parties).
|
9.
|
A certificate of an Authorised Signatory of the Manager certifying that each copy document relating to it specified in this Schedule is correct, complete and in full force and effect as at a date no earlier than the date of this Side Letter.
|
1.
|
A certificate of an Authorised Signatory of the Manager confirming that:
|
(a)
|
the CMS Licence is in full force and effect and has not been amended or revoked and there is no breach of the terms and conditions applicable to the CMS Licence;
|
(b)
|
the Tax Rulings have not been withdrawn or materially and adversely amended;
|
(c)
|
the SGX-ST Waiver has not been withdrawn or materially and adversely amended;
|
(d)
|
the MAS Waiver has not been withdrawn or materially and adversely amended; and
|
(e)
|
the authorisation of Prime US REIT as a collective investment scheme by the MAS has not been withdrawn or materially and adversely amended.
|
2.
|
The Advance Funding Parties are satisfied that:
|
(a)
|
the Underwriting Agreements have been entered into by all parties thereto and has not been terminated, and none of the Advance Funding Parties has given notice to the REIT Trustee that either of the Underwriting Agreements have been breached;
|
(b)
|
the receiving bank agreement required relating to the Listing (and any other settlement-related agreements which the Advance Funding Parties have determined are required in connection with the Listing) has/have been entered into between all parties thereto and have not been terminated or breached;
|
(c)
|
no circumstances have occurred that would be reasonably likely to prevent the commencement of trading of the Units on the SGX-ST after Listing occurs;
|
(d)
|
no circumstances have occurred which indicate that Listing is unlikely to occur by the proposed Listing Date; and
|
(e)
|
all of the other conditions set out in in clause 7.3 of the Singapore Offer Agreement and clause 7.3 of the Placement Agreement
have been fulfilled.
|
3.
|
A legal opinion addressed to the Advance Funding Parties from Clifford Chance Pte. Ltd. addressing the enforceability of this Side Letter;
|
537518-4-8565-v9.0
|
‑
23
‑
|
17-40684037
|
4.
|
A legal opinion addressed to the Advance Funding Parties from Allen & Gledhill LLP addressing, among others, the due incorporation and authority of the Manager to execute, deliver and perform its obligations under this Side Letter; and
|
5.
|
A legal opinion addressed to the Advance Funding Parties from Shook Lin & Bok LLP addressing, among others, the due incorporation and authority of the REIT Trustee to execute, deliver and perform its obligations under this Side Letter,
|
537518-4-8565-v9.0
|
‑
24
‑
|
17-40684037
|
537518-4-8565-v9.0
|
‑
25
‑
|
17-40684037
|
2.
|
Procedure for Delivery and Confirmation of Closing Deliverables
.
|
2.3
|
Execution of Closing Statement
.
|
1
|
The times for the Automatic Time for the Close of Escrow and the Final Determination Time, and the times
|
Fax No.: 65 6441 5251
|
|
|
and to:
|
|
Greenberg Traurig LLP
|
|
2375 E. Camelback Road, Suite 700
|
|
Phoenix, AZ 85016
|
|
Attention: Caroline Pritcher
|
|
Telephone No: (602) 445-8261
|
|
Fax No.: (602) 445-8100
|
|
|
If to Administrative Agent
:
|
|
|
|
Bank of America, N.A.
|
with a copy to:
|
520 Newport Center Drive, Suite 1100
|
Morrison & Foerster LLP
|
Newport Beach, CA 92660
|
707 Wilshire Boulevard
|
Attn: Kevin McLain
|
Los Angeles, California 90017
|
Telephone: 949-287-0461
|
Attn: Thomas R. Fileti, Esq.
|
Electronic mail:kevin.mclain@bofa.com
|
Phone: (213) 892-5276
|
|
Electronic mail:
tfileti@mofo.com
|
|
|
|
and to:
|
|
Morrison & Foerster LLP
|
|
707 Wilshire Boulevard
|
|
Los Angeles, California 90017
|
|
Attn: Adam N. Hopkins, Esq.
|
|
Phone: (213) 892-5276
|
|
Electronic mail:
ahopkins@mofo.com
|
|
|
If to Pre-funding Parties
:
|
|
|
|
DBS Bank Ltd.
|
|
12 Marina Boulevard, Level 46
|
|
DBS Asia Central@ MBFC Tower 3
|
|
Singapore 018982
|
|
Fax: +65 6227 9162
|
|
Attention: Tan Jeh Wuan / Sanjog Kusumwal
|
|
|
|
Merrill Lynch (Singapore) Pte. Ltd.
|
|
50 Collyer Quay #14-01
|
|
OUE Bayfront
|
|
Singapore 049321
|
|
Fax: +65 6678 0130
|
|
Attention: Martin Siah / Antonio Puna
|
|
|
|
China International Capital Corporation (Singapore) Pte. Limited
|
|
6 Battery Road #33-01
|
|
Singapore 049909
|
Fax: +65 6327 1278
|
Attention: Lindsay Lin / Ding Peng
|
|
Credit Suisse (Singapore) Limited
|
One Raffles Link #03/#04-01
|
South Lobby
|
Singapore 039393
|
Fax: +852 2284 7184
|
Attention: Investment Banking & Capital Markets - Legal
|
|
Maybank Kim Eng Securities Pte. Ltd.
|
50 North Canal Road #03-01
|
Singapore 059304
|
Fax: +65 6636 3549
|
Attention: Ms Audrey Lam / Mr Lak Yau Huang
|
|
Oversea-Chinese Banking Corporation Limited
|
63 Chulia Street #03-03
|
OCBC Centre East
|
Singapore 049514
|
Fax: +65 6532 2935
|
Attention: Andrew Teo / Allen Cheong
|
|
If to Title Company or Escrow Holder
:
|
|
Commonwealth Land Title Insurance Company
|
4100 Newport Place Drive, Suite 120
|
Newport Beach, California 92660
|
Attention: Joy Eaton
|
Phone: (949) 724-3145
|
Fax No.: (949) 271-5762
|
Electronic mail: joyeaton@ltic.com
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
_____________________
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
______________________
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
______________________
|
By:
|
PRIME US-ACQUISITION I, LLC
|
By:
|
PRIME US PROPERTIES, LLC,
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
______________________
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
_____________________
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
______________________
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
_____________________
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
_____________________
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
______________________
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
_____________________
|
By:
|
PRIME US-LOWER TIER, LLC
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
______________________
|
By:
|
KBSIII VILLAGE CENTER STATION II MEMBER, LLC,
|
By:
|
KBSIII REIT ACQUISITION XXXII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
______________________
|
By:
|
KBSIII REIT ACQUISITION VI, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
_____________________
|
By:
|
KBSIII REIT ACQUISITION X, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
_____________________
|
By:
|
KBSIII REIT ACQUISITION XIII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
_____________________
|
By:
|
KBSIII REIT ACQUISITION XV, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
_____________________
|
By:
|
KBSIII REIT ACQUISITION XVIII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
_____________________
|
By:
|
KBSIII REIT ACQUISITION XX, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
_____________________
|
By:
|
KBSIII REIT ACQUISITION XXIII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
_____________________
|
By:
|
KBSIII PROMENADE ONE MEZZ, LLC,
|
By:
|
KBSIII PROMENAGE AT EILAN, LLC,
|
By:
|
KBSIII 3003 WASHINGTON MEMBER, LLC,
|
By:
|
KBSIII REIT ACQUISITION XVII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
_____________________
|
By:
|
KBSIII PROMENADE TWO MEZZ, LLC,
|
By:
|
KBSIII PROMENADE AT EILAN, LLC,
|
By:
|
KBSIII 3003 WASHINGTON MEMBER, LLC,
|
By:
|
KBSIII REIT ACQUISITION XVII, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III,
|
By:
|
_____________________
|
By:
|
KBSIII CROSSPOINT AT VALLEY FORGE, LLC,
|
By:
|
KBSIII REIT ACQUISITION XXVI, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
______________________
|
By:
|
KBSIII REIT ACQUISITION XXI, LLC,
|
By:
|
KBS REIT PROPERTIES III, LLC,
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
______________________
|
By:
|
PRIME US-MIDDLE TIER, LLC,
|
By:
|
PRIME US-UPPER TIER, LLC,
|
By:
|
PRIME US-SUB REIT, INC.,
|
By:
|
_____________________
|
By:
|
___________________________
|
By:
|
___________________________
|
By:
|
___________________________
|
By:
|
___________________________
|
By:
|
___________________________
|
By:
|
___________________________
|
By:
|
___________________________
|
|
SELLER PARTY
|
REAL PROPERTY NAME AND
ADDRESS
|
BUYER PARTY
|
1.
|
Village Center Station II
Owner, LLC, a Delaware
limited liability company
|
Village Center Station II (Charter
Communications
)
6350 and 6360 South Fiddlers
Green Circle
Greenwood Village, CO 80111
|
Prime US-Village Center Station
II, LLC, a Delaware limited
liability company
|
2.
|
KBSIII Tower at Lake
Carolyn, LLC, a
Delaware limited
liability company
|
Tower At Lake Carolyn (Tower
909
)
909 E. Lake Carolyn Parkway,
Irving, TX 75039
|
Prime US-Tower At Lake
Carolyn, LLC, a Delaware
limited liability company
|
3.
|
KBSIII One
Washingtonian, LLC, a
Delaware limited
liability company
|
One Washingtonian
9801 Washingtonian Boulevard
Gaithersburg, MD 20878
|
Prime US-One Washingtonian,
LLC, a Delaware limited
liability company
|
4.
|
KBSIII 222 Main, LLC,
a Delaware limited
liability company
|
222 Main
222 South Main Street,
Salt Lake City, UT 84101
|
Prime US-222 Main, LLC, a
Delaware limited liability
company
|
5.
|
KBSIII 171 17th Street,
LLC, a Delaware limited
liability company
|
171 17th Street
171 17th Street NW
Atlanta, GA 30363
|
Prime US-171 17th Street, LLC, a
Delaware limited liability
company
|
6.
|
KBSIII Reston Square,
LLC, a Delaware limited
liability company
|
Reston Square
11790 Sunrise Valley Drive
Reston, VA 20191
|
Prime US-Reston Square, LLC, a
Delaware limited liability
company
|
7.
|
KBSIII 101 South
Hanley, LLC, a
Delaware limited
liability company
|
101 South Hanley
101 South Hanley
Clayton, MO 63105
|
Prime US-101 South Hanley,
LLC, a Delaware limited
liability company
|
8.
|
KBSIII Village Center
Station, LLC, a
Delaware limited
liability company
|
Village Center Station
6380 South Fiddlers Green Circle
Greenwood Village, CO 80111
|
Prime US-Village Center Station,
LLC, a Delaware limited
liability company
|
9.
|
Promenade One
KBSIII Promenade One,
LLC, a Delaware limited
liability company
Promenade Two
KBSIII Promenade Two,
LLC, a Delaware limited
liability company
|
Promenade I & II At Eilan
Promenade One
17806 IH-10 W
San Antonio, Texas 78257
Promenade Two
17802 IH-10 W
San Antonio, Texas 78257
|
Prime US-Promenade, LLC, a
Delaware limited liability
company
|
10.
|
KBSIII CrossPoint At
Valley Forge Trust, a
Delaware Statutory Trust
|
Crosspoint
550 East Swedesford Road
Wayne, PA 19087
|
Prime US-CrossPoint At Valley
Forge, LLC, a Delaware limited
liability company
|
11.
|
KBSIII Towers At
Emeryville, LLC, a
Delaware limited
liability company
|
Towers At Emeryville – Tower I
1900 Powell Street
Emeryville, CA 94608
|
Prime US-Tower At Emeryville,
LLC, a Delaware limited
liability company
|
1.
|
[
TBD - to be completed prior to execution
]
|
2.
|
|
3.
|
|
Buyer:
|
Seller: Village Center Station II Owner, LLC
|
|
1.
|
Special Warranty Deed, executed by Seller.
|
|
2.
|
Assignment of Leases and Contracts and Bill of Sale, executed by Seller and Buyer.
|
|
3.
|
FIRPTA Certificate, executed by KBS Real Estate Investment Trust III, Inc.
|
|
4.
|
Owner's Affidavit, executed by Seller.
|
|
5.
|
Seller's Reaffirmation, executed by Seller.
|
|
6.
|
Notice to Tenants, executed by Seller and Buyer.
|
|
7.
|
Closing letter, executed by Seller and Buyer.
|
|
8.
|
Real Estate Reporting Solicitation (Form 1099), executed by Seller.
|
|
9.
|
DR 1083 – Information With Respect to a Conveyance of Colorado Real Property Interest Form,
executed by Seller.
|
|
10.
|
Real Party Transfer Declaration (TD 1000), executed by Seller.
|
Buyer:
|
Seller: KBSIII Tower at Lake Carolyn, LLC
|
|
11.
|
Special Warranty Deed, executed by Seller.
|
|
12.
|
Assignment of Leases and Contracts and Bill of Sale, executed by Seller and Buyer.
|
13.
|
FIRPTA Certificate, executed by KBS Real Estate Investment Trust III, Inc.
|
|
14.
|
Owner's Affidavit, executed by Seller.
|
|
15.
|
Seller's Reaffirmation, executed by Seller.
|
|
16.
|
Notice to Tenants, executed by Seller and Buyer.
|
|
17.
|
Real Estate Reporting Solicitation (Form 1099), executed by Seller.
|
Buyer:
|
Seller: KBSIII One Washington, LLC
|
|
18.
|
Special Warranty Deed, executed by Seller.
|
|
19.
|
Assignment of Leases and Contracts and Bill of Sale, executed by Seller and Buyer.
|
|
20.
|
FIRPTA Certificate, executed by KBS Real Estate Investment Trust III, Inc.
|
|
21.
|
Owner's Affidavit, executed by Seller.
|
|
22.
|
Seller's Reaffirmation, executed by Seller.
|
|
23.
|
Notice to Tenants, executed by Seller and Buyer.
|
|
24.
|
Real Estate Reporting Solicitation (Form 1099), executed by Seller.
|
|
25.
|
WH – AR Form (Certification of Exemption from Withholding Upon Disposition of Maryland Real
Estate Affidavit of Residence or Principal Residence), executed by Seller.
|
Buyer:
|
Seller: KBSIII 222 Main, LLC
|
|
26.
|
Special Warranty Deed, executed by Seller.
|
|
27.
|
Assignment of Leases and Contracts and Bill of Sale, executed by Seller and Buyer.
|
|
28.
|
FIRPTA Certificate, executed by KBS Real Estate Investment Trust III, Inc.
|
|
29.
|
Owner's Affidavit, executed by Seller.
|
|
30.
|
Seller's Reaffirmation, executed by Seller.
|
|
31.
|
Notice to Tenants, executed by Seller and Buyer.
|
32.
|
Real Estate Reporting Solicitation (Form 1099), executed by Seller.
|
Buyer:
|
Seller: KBSIII 171 17th Street, LLC
|
|
33.
|
Limited Warranty Deed, executed by Seller.
|
|
34.
|
Assignment of Leases and Contracts and Bill of Sale, executed by Seller and Buyer.
|
|
35.
|
FIRPTA Certificate, executed by KBS Real Estate Investment Trust III, Inc.
|
|
36.
|
Owner's Affidavit, executed by Seller.
|
|
37.
|
Seller's Reaffirmation, executed by Seller.
|
|
38.
|
Notice to Tenants, executed by Seller and Buyer.
|
|
39.
|
Real Estate Reporting Solicitation (Form 1099), executed by Seller.
|
|
40.
|
Affidavit of Seller's Residence, executed by KBS Real Estate Investment Trust III, Inc.
|
|
41.
|
Seller's Broker Affidavit, executed by Seller.
|
|
42.
|
Buyer's Broker Affidavit, executed by Buyer.
|
Buyer:
|
Seller: KBSIII Reston Square, LLC
|
|
43.
|
Special Warranty Deed, executed by Seller.
|
|
44.
|
Assignment of Leases and Contracts and Bill of Sale, executed by Seller and Buyer.
|
|
45.
|
FIRPTA Certificate, executed by KBS Real Estate Investment Trust III, Inc.
|
|
46.
|
Owner's Affidavit, executed by Seller.
|
|
47.
|
Seller's Reaffirmation, executed by Seller.
|
|
48.
|
Notice to Tenants, executed by Seller and Buyer.
|
|
49.
|
Real Estate Reporting Solicitation (Form 1099), executed by Seller.
|
|
50.
|
Virginia Department of Taxation Nonresident Real Property Owner Registration (Form R-5),
executed by Seller
|
Buyer:
|
Seller: KBSIII 101 South Hanley, LLC
|
|
51.
|
Special Warranty Deed, executed by Seller.
|
|
52.
|
Assignment of Leases and Contracts and Bill of Sale, executed by Seller and Buyer.
|
|
53.
|
FIRPTA Certificate, executed by KBS Real Estate Investment Trust III, Inc.
|
|
54.
|
Owner's Affidavit, executed by Seller.
|
|
55.
|
Seller's Reaffirmation, executed by Seller.
|
|
56.
|
Notice to Tenants, executed by Seller and Buyer.
|
|
5.
|
Real Estate Reporting Solicitation (Form 1099), executed by Seller.
|
|
58.
|
St. Louis County Certificate of Value Form, executed by Buyer.
|
Buyer:
|
Seller: KBSIII Village Center Station, LLC
|
|
59.
|
Special Warranty Deed, executed by Seller.
|
|
60.
|
Assignment of Leases and Contracts and Bill of Sale, executed by Seller and Buyer.
|
|
61.
|
FIRPTA Certificate, executed by KBS Real Estate Investment Trust III, Inc.
|
|
62.
|
Owner's Affidavit, executed by Seller.
|
|
63.
|
Seller's Reaffirmation, executed by Seller.
|
|
64.
|
Notice to Tenants, executed by Seller and Buyer.
|
|
65.
|
Real Estate Reporting Solicitation (Form 1099), executed by Seller.
|
|
66.
|
DR 1083 – Information With Respect to a Conveyance of Colorado Real Property Interest Form,
executed by Seller.
|
|
67.
|
Real Property Transfer Declaration (TD 1000), executed by Seller.
|
Buyer:
|
Seller: KBSIII Promenade One, LLC
KBSIII Promenade Two, LLC
|
|
68.
|
Special Warranty Deed, executed by Seller.
|
|
69.
|
Assignment of Leases and Contracts and Bill of Sale, executed by Seller and Buyer.
|
|
70.
|
FIRPTA Certificate, executed by KBS Real Estate Investment Trust III, Inc.
|
|
71.
|
Owner's Affidavit, executed by Seller.
|
|
72.
|
Seller's Reaffirmation, executed by Seller.
|
|
73.
|
Notice to Tenants, executed by Seller and Buyer.
|
|
74.
|
Real Estate Reporting Solicitation (Form 1099), executed by Seller.
|
Buyer:
|
Seller: KBSIII CrossPoint At Valley Forge Trust
|
|
75.
|
Special Warranty Deed, executed by Seller.
|
|
76.
|
Assignment of Leases and Contracts and Bill of Sale, executed by Seller and Buyer.
|
|
77.
|
FIRPTA Certificate, executed by KBS Real Estate Investment Trust III, Inc.
|
|
78.
|
Owner's Affidavit, executed by Seller.
|
|
79.
|
Seller's Reaffirmation, executed by Seller.
|
|
80.
|
Notice to Tenants, executed by Seller and Buyer.
|
|
81.
|
Real Estate Reporting Solicitation (Form 1099), executed by Seller.
|
|
82.
|
Realty Transfer Tax Statement of Value, executed by Seller.
|
|
83.
|
One (1) original Application for Tax Clearance Certificate, executed by Seller.
|
|
84.
|
PA Realty Transfer Tax Statement of Value, executed by Buyer.
|
Buyer:
|
Seller: KBSIII Towers At Emeryville, LLC
|
|
85.
|
Grant Deed, executed by Seller.
|
|
86.
|
Assignment of Leases and Contracts and Bill of Sale and Post Closing Agreement, executed by Seller
and Buyer.
|
|
87.
|
FIRPTA Certificate and California Form 593-C Withholding Exemption Certificate, each executed
by KBS Real Estate Investment Trust III, Inc.
|
|
88.
|
Owner's Affidavit, executed by Seller.
|
|
89.
|
Seller's Reaffirmation, executed by Seller.
|
|
90.
|
Notice to Tenants, executed by Seller and Buyer.
|
|
91.
|
Real Estate Reporting Solicitation (Form 1099), executed by Seller.
|
|
92.
|
CA Natural Hazard Disclosure Statement, executed by Seller and Buyer.
|
|
93.
|
California Preliminary Change of Ownership Report, executed by Buyer.
|
CLIFFORD
CHANCE
|
|
CLIFFORD CHANCE PTE LTD
|
537518-4-8567-v1.2
|
|
17-40684037
|
CONTENTS
|
|||
Clause
|
Page
|
|
|
1.
|
Definitions
|
2
|
|
2.
|
Loan of Units
|
4
|
|
3.
|
Delivery of Loan Securities
|
5
|
|
4.
|
Rights and Title
|
6
|
|
5.
|
Duties, Cost and Expenses
|
7
|
|
6.
|
Representations, Warranties and Agreements
|
7
|
|
7.
|
Termination of the Loan and Re-Delivery of the Equivalent Securities
|
9
|
|
8.
|
Events of Default
|
10
|
|
9.
|
Notice
|
12
|
|
10.
|
Miscellaneous
|
13
|
|
11.
|
Remedies
|
14
|
|
12.
|
Rights of Third Parties
|
14
|
|
13.
|
Counterparts
|
14
|
|
14.
|
Governing Law and Jurisdiction
|
14
|
537518-4-8567-v1.2
|
|
17-40684037
|
(1)
|
KBS REIT Properties III LLC, a limited liability company organised under the laws of the State of Delaware, whose registered office is at Registered Agent Solutions, Inc. 9E Loockerman Street, Suite 311 Dover, DE, Kent County 19901, USA (the "
Lender
"); and
|
(2)
|
Merrill Lynch (Singapore) Pte. Ltd., a company incorporated in Singapore and having its principal place of business at 50 Collyer Quay #14-01, OUE Bayfront, Singapore 049321 (the "
Borrower
"),
|
(A)
|
Prime US REIT was constituted by a trust deed dated 7 September 2018, as amended and supplemented, made between KBS US Prime Property Management Pte. Ltd. as manager of Prime US REIT (the "
Manager
") and DBS Trustee Limited as trustee of Prime US REIT (the "
Trustee
") and is authorised as a collective investment scheme under Section 286 of the Securities and Futures Act, Chapter 289 of Singapore. The Manager is a company incorporated in Singapore on 26 July 2018 under the Companies Act (as defined below).
|
(B)
|
In connection with the Offering (as defined below) and listing of units representing undivided interests in Prime US REIT on the SGX-ST (as defined below), the Lender has granted the Joint Bookrunners (as defined below) an over-allotment option exercisable by the Borrower in consultation with the Joint Bookrunners, in full or in part, on one occasion, to borrow up to an aggregate of 22,727,000 Units (the "
Borrowed Units
") representing not more than 6.8% of the total Offering Units (as defined below), solely to cover the over-allotment of Units.
|
(C)
|
On 11 February 2019, the SGX-ST confirmed in a letter, the validity of which was extended in a letter dated 7 May 2019 (the "
Eligibility Letter
") that Prime US REIT was eligible for a listing on the Main Board of the SGX-ST and approved the quotation and dealing of,
inter alia
, all the Units comprised in the Offering, the KBS Units, the Cornerstone Units, all Units which will be issued to the Manager from time to time in full or part payment of the Manager's fees and all the Units which may be issued from time to time for full or part payment of the property manager's fees on the Main Board of the SGX-ST, subject to the terms and conditions as set out in the Eligibility Letter.
|
(D)
|
The Borrower is the stabilising manager in respect of the Offering on the terms and conditions described in the Prospectus (as defined below).
|
(E)
|
The Borrower wishes to borrow up to an aggregate of 22,727,000 Units from the Lender and the Lender has, at the Borrower’s request, agreed to lend to the Borrower such number of Units that is needed to cover over-allotment of Units (if any), subject to the terms and conditions of this Agreement.
|
|
‑
1
‑
|
17-40684037
|
(F)
|
In consideration of the payment of S$1.00 to the Lender (the receipt and the sufficiency of which is hereby acknowledged), the Borrower and the Lender have agreed to enter into unit borrowing and lending transactions subject to the terms and conditions of this Agreement.
|
1.
|
DEFINITIONS
|
1.1
|
In this Agreement unless the context otherwise requires:
|
|
‑
2
‑
|
17-40684037
|
|
‑
3
‑
|
17-40684037
|
1.2
|
Notwithstanding the use of the expressions such as "borrow", "deliver", "lend" and "re-deliver", which are used to reflect terminology used in the market for transactions of the kind provided for in this Agreement, title to the Loan Securities shall pass from one party to another as provided for in this Agreement, the party obtaining such title being obliged to re-deliver Equivalent Securities, including title to Equivalent Securities in accordance with Clause 7.
|
1.3
|
All headings appear for convenience only and shall not affect the interpretation hereof.
|
1.4
|
References to Clauses and Sub-clauses are to clauses and sub-clauses of this Agreement.
|
1.5
|
Any capitalised term not defined in this Agreement shall have the meaning ascribed to it in the Underwriting Agreements.
|
2.
|
LOAN OF UNITS
|
2.1
|
Subject to the terms and conditions of this Agreement, the Borrower may, at its discretion, send the Borrowing Request to the Lender to borrow Loan Securities from the Lender. The Lender shall, upon receipt of the Borrowing Request from the Borrower no later than four (4) Business Days prior to the Settlement Date, lend the number of Units requested and the Borrower shall borrow such number of Units from the Lender on such Settlement Date solely to cover the over-allotment of Units in connection with the Offering (if any). For the avoidance of doubt, only one (1)
|
|
‑
4
‑
|
17-40684037
|
2.2
|
The aggregate number of Units which the Borrower may borrow under this Agreement shall not exceed the total number of Units available under the Over-Allotment Option.
|
2.3
|
Except as provided under Recital (F) and Clause 5, the Borrower and the Lender agree that no fees and no collateral will be payable by the Borrower in connection with any Loan under this Agreement.
|
2.4
|
Notwithstanding the provisions in this Agreement with respect to when the Loan occurs, the Loan hereunder shall not occur until such Loan Securities in respect of the Borrowing Request shall have been delivered to the Borrower in accordance with Clause 3.
|
2.5
|
The Lender agrees that the Borrower is irrevocably authorised, subject to all applicable laws and regulations, to delegate all or any of its relevant rights, duties, powers and discretions (which rights, duties, powers and discretions shall at all times be exercised in accordance with the provisions of this Agreement) in such manner and on such terms as it thinks fit (with or without formality and without prior notice of any such delegation being required to be given to the Lender) to any one or more of its Affiliates, provided that the Borrower shall continue to be bound by the terms of this Agreement and shall remain liable under this Agreement for all acts and omissions of any Affiliate in breach of this Agreement to which it delegates any such rights, duties, powers or discretions.
|
3.
|
DELIVERY OF LOAN SECURITIES
|
3.1
|
Subject to each of the Underwriting Agreements not having been terminated pursuant to the terms thereof on or prior to the date of admission of Prime US REIT to the Official List of the SGX-ST (the "
Listing Date
"), upon receipt of a Borrowing Request in accordance with Clause 2.1, the Lender shall deliver such number of Loan Securities specified in the Borrowing Request to the Borrower no later than 12.00 noon (Singapore time) (or such other time as the parties may agree) on the Listing Date (the "
Settlement Date
") by:
|
(a)
|
causing the Loan Securities to be debited from the Lender's CDP accounts and credited to the CDP account(s) notified to the Lender by the Borrower; or
|
(b)
|
any other method of delivery as shall be agreed upon by both parties.
|
3.2
|
The Borrower shall notify the Lender of the details of the CDP account(s) that the Loan Securities are to be credited to prior to or together with the delivery of any Borrowing Request made pursuant to Clause 2.1.
|
|
‑
5
‑
|
17-40684037
|
3.3
|
Notwithstanding the foregoing, delivery of the Loan Securities shall be made in such manner as shall be effective to give the Borrower full right, title and interest in the Loan Securities.
|
4.
|
RIGHTS AND TITLE
|
4.1
|
The parties hereto shall execute and deliver all necessary documents and give all necessary instructions to procure that all right, title and interest in:
|
(a)
|
(in the case of the Lender) any Loan Securities borrowed pursuant to Clause 2; and
|
(b)
|
(in the case of the Borrower) any Equivalent Securities re-delivered pursuant to Clause 7;
|
4.2
|
Where any right to vote in respect of any Loan Securities arises or rights relating to conversion, sub-division, consolidation or pre-emption, rights arising under a takeover offer, or rights requiring election by the holder for the time being, in respect of any Loan Securities become exercisable prior to the re-delivery of the Equivalent Securities, the Borrower shall, only to the extent that it retains control over or has possession of such Loan Securities, arrange for such rights in respect of the Loan Securities to be exercised in accordance with the instructions of the Lender (in respect of the Loan Securities), provided that the Lender must notify the Borrower of its instructions in writing no later than seven Business Days prior to the latest time upon which such votes are exercisable or for the exercise of the right or as otherwise notified by the Borrower to the Lender. For the avoidance of doubt, the Borrower shall not be obliged to exercise the votes or make the election in respect of a number of Loan Securities greater than (a) the number so lent to it by the Lender, or (b) the number of such Loan Securities that the Borrower retains control over or is in possession of (provided that any cessation of control over or possession of any Loan Securities shall be solely for the purpose of covering over-allotments of Units in connection with the Offering), whichever is less. For the avoidance of doubt, the parties agree that subject as hereinbefore provided, any voting rights attaching to or
|
|
‑
6
‑
|
17-40684037
|
4.3
|
The Lender shall be entitled to receive such amounts as are equal to all interest, dividend or other distribution or payment of any kind whatsoever ("
Income
") on or in respect of the Loan Securities for the record dates which occur during the term of the Loan and are received by the Borrower. Any cash Income on or in respect of the Loan Securities, which the Lender is entitled to receive pursuant to this clause shall be paid to the Lender by the Borrower, if received by the Borrower, no later than seven Business Days after the date of receipt by the Borrower of the same subject to the Lender having provided full payment details to the Borrower, or such other date as the Lender and the Borrower may from time to time agree. Non-cash Income on the Loan Securities which are received by the Borrower shall be added to the Loan Securities and shall be considered as such for all purposes, except that if the Loan has terminated, the Borrower shall deliver such non-cash Income to the Lender no later than seven Business Days after the date of receipt by the Borrower.
|
5.
|
DUTIES, COST AND EXPENSES
|
5.1
|
For the avoidance of doubt, the Lender shall not be responsible for income taxes payable by the Borrower in connection with its role as stabilising manager in respect of the Offering or arising out of or in connection with the transactions contemplated in this Agreement.
|
6.
|
REPRESENTATIONS, WARRANTIES AND AGREEMENTS
|
6.1
|
Each of the Lender and the Borrower warrants and represents that:
|
(a)
|
it is duly incorporated, established, organised or constituted (as the case may be) and validly existing under the laws of its country or state of incorporation, establishment, organisation or constitution (as the case may be);
|
(b)
|
it has the power to execute and deliver this Agreement;
|
(c)
|
it has the power to enter into the Loan contemplated hereby and to perform its obligations hereunder;
|
(d)
|
all actions, conditions and things required to be taken, fulfilled and done (including the obtaining of any necessary consents and authorisations) in order to (i) enable it to lawfully enter into, execute and deliver, exercise its rights and power and comply with its obligations under this Agreement, and (ii) to ensure that those obligations are legal, valid, legally binding and enforceable, have been taken, fulfilled and done; and
|
(e)
|
this Agreement constitutes its legal, valid and binding obligations, enforceable in accordance with its terms (subject to bankruptcy, insolvency and similar
|
|
‑
7
‑
|
17-40684037
|
(f)
|
in the case of the Lender, as to all Loan Securities, (i) it will on the Settlement Date be absolutely entitled to pass full legal and beneficial ownership of such Loan Securities provided by it hereunder to the Borrower free and clear of all Encumbrances, (ii) the Loan Securities shall rank in all respects pari passu with all Units existing as at the Settlement Date and will be fully paid-up or credited as fully paid-up, (iii) no other person has or shall have any pre-emptive or similar rights over the Loan Securities, (iv) it is an accredited investor within the meaning of the Securities and Futures Act, Chapter 289 of Singapore (the "
SFA
") at the time the Lender delivers the Loan Securities to the Borrower, and will continue to be an accredited investor within the meaning of the SFA through the entire duration of the Loan, and (v) with respect to its ownership of the Units, it shall be in compliance with all applicable laws and regulations in Singapore and elsewhere, and with the rules of the SGX-ST.
|
6.2
|
Each party accepts liability as principal with respect to its obligations hereunder. For the avoidance of doubt, the Lender shall not be liable for any loss, or entitled to any profit made by the Borrower arising from any over-allotment or stabilisation undertaken by the Borrower (in its capacity as stabilising manager) as contemplated under the Placement Agreement.
|
6.3
|
Each party represents and warrants (with respect to itself) that the execution, delivery and performance by it of this Agreement and the Loan will to its knowledge comply with all applicable laws, rules and regulations including those of the SGX-ST, the CDP and the Authority.
|
6.4
|
The Borrower warrants and represents to the Lender that :-
|
(a)
|
all Loan Securities will be used by the Borrower solely for the purpose of covering over-allotments of Units in connection with the Offering;
|
(b)
|
it is absolutely entitled to pass full legal and beneficial title to all Equivalent Securities provided by it hereunder to the Lender, fully paid-up and free and clear of all Encumbrances; and
|
(c)
|
the Equivalent Securities shall rank in all respects pari passu with all Units existing as at the date the Equivalent Securities are re-delivered and will be fully paid-up or credited as fully paid up and no other persons will have any pre-emptive or similar rights over such Equivalent Securities.
|
|
‑
8
‑
|
17-40684037
|
6.5
|
Each party further represents and warrants that each of the representations and warranties contained in Clauses 6.1, 6.3 and 6.4 (as the case may be) will, in respect of itself, be true and accurate in all respects throughout the duration of the Loan.
|
7.
|
TERMINATION OF THE LOAN AND RE-DELIVERY OF THE EQUIVALENT SECURITIES
|
7.1
|
The Loan may be terminated by the Borrower at any time upon giving not less than one (1) Business Day’s notice of the Termination to the Lender provided always that Termination by the Borrower shall not occur after the Termination Date. The Loan, if not terminated earlier by the Borrower, shall automatically terminate on (a) the termination of any of the Underwriting Agreements, or (ii) the Termination Date, whichever is earlier.
|
7.2
|
In the event the Loan is terminated by the Borrower, the Borrower shall re-deliver, or procure the re-delivery of, the Equivalent Securities (in the same quantity as that set out in the Borrowing Request to the Lender) which, for the avoidance of doubt, shall include any Income made on the Loan Securities due and outstanding (and which have not yet been delivered to the Lender under Clause 4.3) to the CDP account of the Lender, or by such other means that the parties may agree in writing, not later than the date falling three (3) Business Days (or as otherwise agreed in writing between the Borrower and the Lender
)
after the date of Termination indicated in the notice of Termination given by the Borrower to the Lender pursuant to Clause 7.1.
|
7.3
|
In the event that the Loan is not terminated by the Borrower, and is terminated on the Termination Date, the Borrower shall re-deliver, or procure the re-delivery of, all Equivalent Securities which, for the avoidance of doubt, shall include any Income made on the Loan Securities due and outstanding (and which have not yet been delivered to the Lender under Clause 4.3) to the CDP account of the Lender, or by such other means that the parties may agree in writing, not later than the date falling four (4) Business Days (or as otherwise agreed in writing between the Borrower and the Lender) after the Termination Date.
|
7.4
|
The re-delivery to the Lender of the Equivalent Securities under this Agreement may be effected by:
|
(a)
|
the Borrower causing the Equivalent Securities to be credited to the Lender’s account with CDP and such crediting shall result in notice of the transaction being given to the Lender; or
|
(b)
|
any other method of delivery as shall be agreed upon in writing by both parties.
|
|
‑
9
‑
|
17-40684037
|
7.5
|
The Equivalent Securities shall rank in all respects pari passu with all existing Units as at the date the Equivalent Securities are re-delivered and shall be re-delivered to the Lender fully paid-up and free and clear from all Encumbrances. For the avoidance of doubt, such Equivalent Securities shall include any non-cash distribution made on the Loan Securities due and outstanding.
|
7.6
|
(a) The Lender shall be entitled to terminate the Loan and to call for re-delivery of all or any Equivalent Securities at any time by giving seven (7) days’ notice on any Business Day. The Borrower shall re-deliver such Equivalent Securities on or before the expiry of such notice period in accordance with the Lender’s instructions.
|
(b)
|
The Lender and the Borrower acknowledge that the Borrower agrees to the Lender having the right under this Clause 7.6 in order to address the Lender’s concerns that it is not deemed, under the Singapore Code on Take-overs and Mergers, to have disposed of the Loaned Securities when it lends them to the Borrower or to have acquired Equivalent Securities when they are returned to the Lender by the Borrower under this Agreement.
|
8.
|
EVENTS OF DEFAULT
|
8.1
|
Each of the following events shall constitute an Event of Default under this Agreement:
|
(a)
|
in relation to the Borrower only, if Equivalent Securities shall not be delivered to the Lender in accordance with this Agreement following Termination;
|
(b)
|
in relation to the Borrower only, if the Borrower fails to make payment of Income in accordance with Clause 4.3;
|
(c)
|
if the Borrower or the Lender ceases or threatens to cease carrying on its core business prior to the re-delivery of the Equivalent Securities;
|
(d)
|
if the Borrower or the Lender makes a general assignment for the benefit of its creditors, or admits in writing its inability to pay its debts as they become due and payable, or files a petition in bankruptcy or is adjudicated bankrupt or insolvent, or files a petition seeking reorganisation, liquidation, dissolution, administration or similar relief under any present or future statute, law or regulation, or seeks consent to or acquiesces in the appointment of any trustee, receiver, liquidator, judicial manager or other similar officer of it or over any material part of its properties;
|
(e)
|
if any petition is filed against the Borrower or the Lender (other than by the other party to this Agreement in respect of the obligations under this
|
|
‑
10
‑
|
17-40684037
|
(f)
|
in relation to the Borrower only, if the Borrower shall have been suspended or expelled from membership or participation in any securities exchange, clearing house or association or other self-regulatory organisation in Singapore or if it is suspended from dealing in securities by any governmental agency in Singapore such that the Borrower’s ability to perform its obligations under this Agreement is adversely affected;
|
(g)
|
if any representation or warranty given or made or deemed to be made by either the Borrower or the Lender in this Agreement is or proves to have been untrue or inaccurate in any material respect; or
|
(h)
|
if any of the Underwriting Agreements is terminated in accordance with its terms,
|
8.2
|
If an Event of Default occurs in respect of the Lender, such Lender shall give notice in writing of the occurrence of the Event of Default to the Borrower forthwith and the Borrower shall re-deliver the Equivalent Securities, free from all Encumbrances,
to the Lender in the manner contemplated by Clause 7.2.
|
8.3
|
If an Event of Default occurs in respect of the Borrower, the Borrower shall give notice in writing of the occurrence of the Event of Default to the Lender forthwith, and the Borrower shall as soon as reasonably practicable and in any event no later than four (4) Business Days following the date of the Event of Default re-deliver the Equivalent Securities, free from all Encumbrances,
to the CDP account of the Lender. If the Borrower fails to do so, the Borrower shall pay the Lender damages equal to Market Value of the Equivalent Securities on the date such Event of Default occurs. Insofar as may be applicable, an Event of Default is deemed to occur on the date where the notice expires, if a notice is served, or else it is the specified termination date of the Loan.
|
|
‑
11
‑
|
17-40684037
|
8.4
|
If the event referred to in Clause 8.1(h) above occurs, the Borrower shall re-deliver all Loan Securities received by the Borrower to the Lender, free from all Encumbrances, as soon as reasonably practicable and in any event no later than four (4) Business Days following the termination of any of the Underwriting Agreements.
|
9.
|
RECOGNITION OF THE U.S. SPECIAL RESOLUTION REGIMES
|
9.1
|
In the event that the Borrower becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer from the Borrower of this Agreement, and any interest and obligation in or under this Agreement, will be effective to the same extent as the transfer would be effective under the U.S. Special Resolution Regime if this Agreement, and any such interest and obligation, were governed by the laws of the United States or a state of the United States.
|
9.2
|
In the event that the Borrower or a BHC Act Affiliate of the Borrower becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under this Agreement that may be exercised against the Borrower are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if this Agreement were governed by the laws of the United States or a state of the United States..
|
10.
|
NOTICE
|
|
‑
12
‑
|
17-40684037
|
Fax Number
|
:
|
65 6678 0130
|
Address
|
:
|
50 Collyer Quay #14-01
OUE Bayfront
Singapore 049321
|
Attention
|
:
|
Martin Siah / Antonio Puna
|
11.
|
MISCELLANEOUS
|
11.1
|
This Agreement shall be binding upon and shall inure to the benefit of the parties and their respective successors and permitted assigns, except that none of the parties may, without the prior written consent of the other parties, assign any of their rights or obligations under this Agreement save for the Borrower, which may assign or delegate its rights and obligations under this Agreement to its affiliates.
|
11.2
|
This Agreement shall not be amended or cancelled (subject only to fulfilment of any obligations then outstanding) except by notice in writing signed by each of the parties.
|
11.3
|
If any provision of this Agreement is declared by any judicial or other competent authority to be void or otherwise unenforceable, that provision shall be severed from this Agreement and the remaining provisions of this Agreement shall remain in full force and effect. This Agreement shall, however, thereafter be amended by the parties in such reasonable manner so as to achieve, without illegality, the intention of the parties with respect to that severed provision.
|
11.4
|
Time shall be of the essence of this Agreement. The parties shall execute and do, and procure that all other necessary persons or companies (if any) execute and do, all such further deeds, assurances, acts and things as may be reasonably required to be done such that full effect may be given to this Agreement.
|
11.5
|
The Borrower’s right to borrow any Units and the Lender's obligations to lend any Units under this Agreement shall expire on the Termination Date and such expiry shall be without prejudice to other rights and obligations of the Borrower and the Lender hereunder.
|
|
‑
13
‑
|
17-40684037
|
12.
|
REMEDIES
|
12.1
|
No delay or omission on the Lender's or the Borrower’s part in exercising any right, power, privilege or remedy hereunder shall impair such right, power, privilege or remedy or be construed as a waiver thereof nor shall any single or partial exercise of any such right, power, privilege or remedy preclude any further exercise thereof or the exercise of any other right, power, privilege or remedy.
|
12.2
|
The rights, powers, privileges and remedies herein provided are cumulative and not exclusive of any rights, powers, privileges or remedies provided by law. All remedies hereunder shall survive the termination of the Loan, re-delivery of Equivalent Securities and termination of this Agreement.
|
13.
|
RIGHTS OF THIRD PARTIES
|
14.
|
COUNTERPARTS
|
15.
|
GOVERNING LAW AND JURISDICTION
|
15.1
|
This Agreement is governed by, and shall be construed in accordance with Singapore law.
|
15.2
|
The parties agree that the courts of Singapore are to have non-exclusive jurisdiction to settle any dispute (including claims for set-off and counter claims) which may arise in connection with the creation, validity, effect, interpretation, or performance of, or of legal relationships established by, this Agreement or otherwise arising in connection with this Agreement and for such purposes irrevocably submit to the non-exclusive jurisdiction of the Singapore courts. All parties hereto irrevocably waive any objections to the non-exclusive jurisdiction of the Singapore courts.
|
15.3
|
The parties irrevocably agree that a judgment order of the Singapore courts in connection with this Agreement is to be conclusive and binding on it and may be enforced against it in the courts of any other jurisdiction.
|
|
‑
14
‑
|
17-40684037
|
|
‑
15
‑
|
17-40684037
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
By:
|
/s/ Siah Geok Wah
|
Name:
|
Siah Geok Wah
|
Title:
|
Managing Director
|
1.
|
KBS Real Estate Investment Trust III, Inc.
("KBS REIT
III") wishes to restrict its right to deal in the units in Prime US REIT (the
"Units")
in which it legally and/or beneficially, directly or indirectly owns or will own, on the date of admission (the
"Listing Date")
of Prime US REIT to the Official List of Singapore Exchange Securities Trading Limited (the
"KBS REIT Properties
III
LLC Lock-up Units"),
in accordance with the terms in this letter agreement. Terms used, but not otherwise defined herein, have the meanings ascribed thereto in the final prospectus to be dated on or around 8 July 2019 and to be registered with the Monetary Authority of Singapore in connection with the Offering (the
"Prospectus").
|
2.
|
In consideration of S$1.00, the receipt and sufficiency of which is hereby acknowledged, KBS REIT III undertakes to the Joint Bookrunners and Underwriters that it will not, subject to the exceptions set out in paragraph 3 below, without the prior written consent of the Joint Bookrunners and Underwriters (such consent not to be unreasonably withheld or delayed) during the period commencing from the date of issuance of the Units until the date falling six months after the Listing Date (both dates inclusive) (the
"First Lock-up Period"),
directly or indirectly:
|
(a)
|
offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to
|
537518-4-8538-v2.1
|
‑
1
‑
|
17-40684037
|
(b)
|
enter into any swap, hedge or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the KBS REIT Properties III LLC Lock-up Units (including any securities convertible into or exercisable or exchangeable for any KBS REIT Properties III LLC Lock-up Units or which carry rights to subscribe for or purchase any such KBS REIT Properties III LLC Lock-up Units);
|
(c)
|
enter into any transaction (including a derivative transaction) or other arrangement with a similar economic effect to the foregoing sub-paragraph (a) or (b);
|
(d)
|
deposit any of its effective interest in the KBS REIT Properties III LLC Lock up Units (including any securities convertible into or exercisable or exchangeable for any KBS REIT Properties III LLC Lock-up Units or which carry rights to subscribe for or purchase any such KBS REIT Properties III LLC Lock-up Units) in any depository receipt facility;
|
(e)
|
enter into a transaction which is designed or which may reasonably be expected to result in any of the above; or
|
(f)
|
publicly announce any intention to do any of the above,
|
3.
|
The above restrictions in paragraph 2 shall not apply to prohibit:
|
(a)
|
KBS REIT III from being able to create a charge over the KBS REIT Properties III LLC Lock-up Units or otherwise grant of security over or creation of any encumbrance over the KBS REIT Properties III LLC Lock-up Units, provided that such charge, security or encumbrance (i) cannot be enforced over any KBS REIT Properties III LLC Lock-up Units during the First Lock-up Period, and (ii) can only be enforced with respect to 50.0% of the effective interest in the KBS REIT Properties III LLC Lock-up Units during the Second Lock-up Period. The charge, security or encumbrance will only be created if the charge (such as a bank or financial institution) agrees that the charge, security or encumbrance over the KBS REIT Properties III LLC Lock-up Units cannot be enforced over 100.0% of the KBS REIT Properties III LLC Lock-up Unit during the First Lock-up Period and can only be enforced in relation to 50.0% of the effective interest in the KBS REIT Properties III LLC Lock-up Units during the Second Lock-up Period;
|
537518-4-8538-v2.1
|
‑
2
‑
|
17-40684037
|
(b)
|
KBS REIT Properties III LLC from entering into any unit lending agreement with the Joint Bookrunners and Underwriters or any sale or transfer of the KBS REIT Properties III LLC Lock-up Units by KBS REIT Properties III LLC pursuant to the exercise of an over-allotment option granted by the Unit Lender to the Joint Bookrunners and Underwriters; and
|
(c)
|
KBS REIT III from being able to transfer the KBS REIT Properties III LLC Lock-up Units to and between any direct and indirect wholly-owned subsidiaries of KBS REIT III, provided that KBS REIT III shall, during the First Lock-up Period, maintain a direct or indirect interest in 100.0% of the KBS REIT Properties III LLC Lock-up Units and, during the Second Lock-up Period, maintain a direct or indirect interest in 50.0% of the KBS REIT Properties III LLC Lock-up Units and KBS REIT III has procured that such transferee subsidiaries have executed and delivered to the Joint Bookrunners and Underwriters undertakings to the effect that such transferee subsidiaries will comply with such restrictions so as to enable KBS REIT III to comply with the foregoing restrictions for the unexpired period of the First Lock-up Period and the Second Lock-up Period.
|
4.
|
For the avoidance of doubt, any Units returned to KBS REIT Properties III LLC pursuant to any unit lending agreement with the Joint Bookrunners and Underwriters shall be subject to the restrictions set out in this letter agreement as if they were KBS REIT Properties III LLC Lock-up Units.
|
5.
|
If, for any reason, the Offering is not completed within six months of the date of the Prospectus, this letter agreement shall be terminated immediately.
|
6.
|
A person who is not a party to this letter agreement shall have no rights under the Contracts (Rights of Third Parties) Act (Chapter 53B of Singapore) to enforce any term of this letter agreement.
|
7.
|
This undertaking is given in favour of the Joint Bookrunners and Underwriters, and accordingly, may be enforced by the Joint Bookrunners and Underwriters. Without prejudice to any other rights or remedies which the Joint Bookrunners and Underwriters may have, we acknowledge and agree that damages may not be an adequate remedy for any breach of this undertaking and the Joint Bookrunners and Underwriters shall be entitled to seek the remedies of injunction, specific performance and other equitable relief for any threatened or actual breach of this undertaking.
|
8.
|
This letter agreement is governed by, and shall be construed in accordance with, the laws of Singapore.
|
9.
|
Both parties agree that the courts of Singapore are to have non-exclusive jurisdiction to settle any dispute (including claims for set-off and counter claims) which may arise in connection with the creation, validity, effect, interpretation, or performance of, or of legal relationships established by, this letter agreement or otherwise arising in connection with this letter agreement.
|
537518-4-8538-v2.1
|
‑
3
‑
|
17-40684037
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
1.
|
KBS Limited Partnership III
("KBS LP
III") wishes to restrict its right to deal in its effective interest in the units in Prime US REIT (the
"Units")
which KBS REIT Properties III LLC legally and/or beneficially, directly or indirectly owns or will own, on the date of admission (the
"Listing Date")
of Prime US REIT to the Official List of Singapore Exchange Securities Trading Limited (the
"KBS REIT Properties
III LLC
Lock-up Units"),
in accordance with the terms in this letter agreement. Terms used, but not otherwise defined herein, have the meanings ascribed thereto in the final prospectus to be dated on or around 8 July 2019 and to be registered with the Monetary Authority of Singapore in connection with the Offering (the
"Prospectus").
|
2.
|
In consideration of S$1.00, the receipt and sufficiency of which is hereby acknowledged, KBS LP III undertakes to the Joint Bookrunners and Underwriters that it will not, subject to the exceptions set out in paragraph 3 below, without the prior written consent of the Joint Bookrunners and Underwriters (such consent not to be unreasonably withheld or delayed) during the period commencing from the date of issuance of the Units until the date falling six months after the Listing Date (both dates inclusive) (the
"First Lock-up Period"),
directly or indirectly:
|
(a)
|
offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to
|
537518-48597-v2.2
|
‑
1
‑
|
17-40684037
|
(b)
|
enter into any swap, hedge or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the KBS REIT Properties III LLC Lock-up Units (including any securities convertible into or exercisable or exchangeable for any KBS REIT Properties III LLC Lock-up Units or which carry rights to subscribe for or purchase any such KBS REIT Properties III LLC Lock-up Units);
|
(c)
|
enter into any transaction (including a derivative transaction) or other arrangement with a similar economic effect to the foregoing sub-paragraph (a) or (b);
|
(d)
|
deposit any of its effective interest in the KBS REIT Properties III LLC Lock up Units (including any securities convertible into or exercisable or exchangeable for any KBS REIT Properties III LLC Lock-up Units or which carry rights to subscribe for or purchase any such KBS REIT Properties III LLC Lock-up Units) in any depository receipt facility;
|
(e)
|
enter into a transaction which is designed or which may reasonably be expected to result in any of the above; or
|
(f)
|
publicly announce any intention to do any of the above,
|
3.
|
The above restrictions in paragraph 2 shall not apply to prohibit:
|
(a)
|
KBS LP III from being able to create a charge over the KBS REIT Properties III LLC Lock-up Units or otherwise grant of security over or creation of any encumbrance over the KBS REIT Properties III LLC Lock-up Units, provided that such charge, security or encumbrance (i) cannot be enforced over any KBS REIT Properties III LLC Lock-up Units during the First Lock-up Period, and (ii) can only be enforced with respect to 50.0% of the effective interest in the KBS REIT Properties III LLC Lock-up Units during the Second Lock-up Period. The charge, security or encumbrance will only be created if the charge (such as a bank or financial institution) agrees that the charge, security or encumbrance over the KBS REIT Properties III LLC Lock-up Units cannot be enforced over 100.0% of the KBS REIT Properties III LLC Lock-up Unit during the First Lock-up Period and can only be enforced in relation to 50.0% of the effective interest in the KBS REIT Properties III LLC Lock-up Units during the Second Lock-up Period;
|
(b)
|
KBS REIT Properties III LLC from entering into any unit lending agreement with the Joint Bookrunners and Underwriters or any sale or transfer of the
|
537518-48597-v2.2
|
‑
2
‑
|
17-40684037
|
(c)
|
KBS LP III from being able to transfer the KBS REIT Properties III LLC Lock-up Units to and between any direct and indirect wholly-owned subsidiaries of KBS LP III, provided that KBS LP III shall, during the First Lock-up Period, maintain a direct or indirect interest in 100.0% of the KBS REIT Properties III LLC Lock-up Units and, during the Second Lock-up Period, maintain a direct or indirect interest in 50.0% of the KBS REIT Properties III LLC Lock-up Units and KBS LP III has procured that such transferee subsidiaries have executed and delivered to the Joint Bookrunners undertakings to the effect that such transferee subsidiaries will comply with such restrictions so as to enable KBS LP III to comply with the foregoing restrictions for the unexpired period of the First Lock-up Period and the Second Lock-up Period.
|
4.
|
For the avoidance of doubt, any Units returned to KBS REIT Properties III LLC pursuant to any unit lending agreement with the Joint Bookrunners and Underwriters shall be subject to the restrictions set out in this letter agreement as if they were KBS REIT Properties III LLC Lock-up Units.
|
5.
|
If, for any reason, the Offering is not completed within six months of the date of the Prospectus, this letter agreement shall be terminated immediately.
|
6.
|
A person who is not a party to this letter agreement shall have no rights under the Contracts (Rights of Third Parties) Act (Chapter 53B of Singapore) to enforce any term of this letter agreement.
|
7.
|
This undertaking is given in favour of the Joint Bookrunners and Underwriters, and accordingly, may be enforced by the Joint Bookrunners and Underwriters. Without prejudice to any other rights or remedies which the Joint Bookrunners and Underwriters may have, we acknowledge and agree that damages may not be an adequate remedy for any breach of this undertaking and the Joint Bookrunners and Underwriters shall be entitled to seek the remedies of injunction, specific performance and other equitable relief for any threatened or actual breach of this undertaking.
|
8.
|
This letter agreement is governed by, and shall be construed in accordance with, the laws of Singapore.
|
9.
|
Both parties agree that the courts of Singapore are to have non-exclusive jurisdiction to settle any dispute (including claims for set-off and counter claims) which may arise in connection with the creation, validity, effect, interpretation, or performance of, or of legal relationships established by, this letter agreement or otherwise arising in connection with this letter agreement.
|
537518-48597-v2.2
|
‑
3
‑
|
17-40684037
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
1.
|
KBS REIT Holdings III, LLC
("KBS REIT Holdings III")
wishes to restrict its right to deal in its effective interest in the units in Prime US REIT (the
"Units")
which KBS Real Estate Investment Trust III, Inc. legally and/or beneficially, directly or indirectly owns or will own, on the date of admission (the
"Listing Date")
of Prime US REIT to the Official List of Singapore Exchange Securities Trading Limited (the
"KBS REIT Properties III LLC Lock-up Units"),
in accordance with the terms in this letter agreement. Terms used, but not otherwise defined herein, have the meanings ascribed thereto in the final prospectus to be dated on or around 8 July 2019 and to be registered with the Monetary Authority of Singapore in connection with the Offering (the
"Prospectus").
|
2.
|
In consideration of S$1.00, the receipt and sufficiency of which is hereby acknowledged, KBS REIT Holdings III undertakes to the Joint Bookrunners and Underwriters that it will not, subject to the exceptions set out in paragraph 3 below, without the prior written consent of the Joint Bookrunners and Underwriters (such consent not to be unreasonably withheld or delayed) during the period commencing from the date of issuance of the Units until the date falling six months after the Listing Date (both dates inclusive) (the
"First Lock-up Period"),
directly or indirectly:
|
537518-4-8536-v2.1
|
‑
1
‑
|
17-40684037
|
(a)
|
offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, hypothecate, grant security over, encumber or otherwise dispose of or transfer, any or all of its effective interest in the KBS REIT Properties III LLC Lock-up Units (including any securities convertible into or exercisable or exchangeable for any KBS REIT Properties III LLC Lock-up Units or which carry rights to subscribe for or purchase any such KBS REIT Properties III LLC Lock-up Units);
|
(b)
|
enter into any swap, hedge or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the KBS REIT Properties III LLC Lock-up Units (including any securities convertible into or exercisable or exchangeable for any KBS REIT Properties III LLC Lock-up Units or which carry rights to subscribe for or purchase any such KBS REIT Properties III LLC Lock-up Units);
|
(c)
|
enter into any transaction (including a derivative transaction) or other arrangement with a similar economic effect to the foregoing sub-paragraph (a) or (b);
|
(d)
|
deposit any of its effective interest in the KBS REIT Properties III LLC Lock up Units (including any securities convertible into or exercisable or exchangeable for any KBS REIT Properties III LLC Lock-up Units or which carry rights to subscribe for or purchase any such KBS REIT Properties III LLC Lock-up Units) in any depository receipt facility;
|
(e)
|
enter into a transaction which is designed or which may reasonably be expected to result in any of the above; or
|
(f)
|
publicly announce any intention to do any of the above,
|
3.
|
The above restrictions in paragraph 2 shall not apply to prohibit:
|
(a)
|
KBS REIT Holdings III from being able to create a charge over the KBS REIT Properties III LLC Lock-up Units or otherwise grant of security over or creation of any encumbrance over the KBS REIT Properties III LLC Lock-up Units, provided that such charge, security or encumbrance (i) cannot be enforced over any KBS REIT Properties III LLC Lock-up Units during the First Lock-up Period, and (ii) can only be enforced with respect to 50.0% of the effective interest in the KBS REIT Properties III LLC Lock-up Units during the Second Lock-up Period. The charge, security or encumbrance will only be created if the charge (such as a bank or financial institution) agrees that the charge, security or encumbrance over the KBS REIT Properties III LLC Lock-up Units cannot be enforced over 100.0% of the KBS REIT Properties III LLC Lock-up Unit during the First Lock-up Period and can only be enforced in relation to 50.0 % of the effective interest in the KBS REIT
|
537518-4-8536-v2.1
|
‑
2
‑
|
17-40684037
|
(b)
|
KBS REIT Properties III LLC from entering into any unit lending agreement with the Joint Bookrunners and Underwriters or any sale or transfer of the KBS REIT Properties III LLC Lock-up Units by KBS REIT Properties III LLC pursuant to the exercise of an over-allotment option granted by the Unit Lender to the Joint Bookrunners and Underwriters; and
|
(c)
|
KBS REIT Holdings III from being able to transfer the KBS REIT Properties III LLC Lock-up Units to and between any direct and indirect wholly-owned subsidiaries of KBS Limited Partnership III, provided that KBS Limited Partnership III shall, during the First Lock-up Period, maintain a direct or indirect interest in 100.0% of the KBS REIT Properties III LLC Lock-up Units and, during the Second Lock-up Period, maintain a direct or indirect interest in 50.0% of the KBS REIT Properties III LLC Lock-up Units and KBS REIT Holdings III has procured that such transferee subsidiaries have executed and delivered to the Joint Bookrunners undertakings to the effect that such transferee subsidiaries will comply with such restrictions so as to enable KBS REIT Holdings III to comply with the foregoing restrictions for the unexpired period of the First Lock-up Period and the Second Lock-up Period.
|
4.
|
For the avoidance of doubt, any Units returned to KBS REIT Properties III LLC pursuant to any unit lending agreement with the Joint Bookrunners and Underwriters shall be subject to the restrictions set out in this letter agreement as if they were KBS REIT Properties III LLC Lock-up Units.
|
5.
|
If, for any reason, the Offering is not completed within six months of the date of the Prospectus, this letter agreement shall be terminated immediately.
|
6.
|
A person who is not a party to this letter agreement shall have no rights under the Contracts (Rights of Third Parties) Act (Chapter 53B of Singapore) to enforce any term of this letter agreement.
|
7.
|
This undertaking is given in favour of the Joint Bookrunners and Underwriters, and accordingly, may be enforced by the Joint Bookrunners and Underwriters. Without prejudice to any other rights or remedies which the Joint Bookrunners and Underwriters may have, we acknowledge and agree that damages may not be an adequate remedy for any breach of this undertaking and the Joint Bookrunners and Underwriters shall be entitled to seek the remedies of injunction, specific performance and other equitable relief for any threatened or actual breach of this undertaking.
|
8.
|
This letter agreement is governed by, and shall be construed in accordance with, the laws of Singapore.
|
9.
|
Both parties agree that the courts of Singapore are to have non-exclusive jurisdiction to settle any dispute (including claims for set-off and counter claims) which may arise in connection with the creation, validity, effect, interpretation, or performance of, or of legal relationships established by, this letter agreement or otherwise arising in connection with this letter agreement.
|
537518-4-8536-v2.1
|
‑
3
‑
|
17-40684037
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
1.
|
KBS REIT Properties III LLC wishes to restrict its right to deal in the units in Prime US REIT (the
"Units")
in which it legally and/or beneficially, directly or indirectly owns or will own, on the date of admission (the
"Listing Date")
of Prime US REIT to the Official List of Singapore Exchange Securities Trading Limited (the
"KBS REIT Properties III LLC Lock-up Units"),
in accordance with the terms in this letter agreement. Terms used, but not otherwise defined herein, have the meanings ascribed thereto in the final prospectus to be dated on or around 8 July 2019 and to be registered with the Monetary Authority of Singapore in connection with the Offering (the
"Prospectus").
|
2.
|
In consideration of S$1.00, the receipt and sufficiency of which is hereby acknowledged, KBS REIT Properties III LLC undertakes to the Joint Bookrunners and Underwriters that it will not, subject to the exceptions set out in paragraph 3 below, without the prior written consent of the Joint Bookrunners and Underwriters (such consent not to be unreasonably withheld or delayed) during the period commencing from the date of issuance of the Units until the date falling six months after the Listing Date (both dates inclusive) (the
"First Lock-up Period"),
directly or indirectly:
|
(a)
|
offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to
|
537518-48535-v2.1
|
‑
1
‑
|
17-40684037
|
(b)
|
enter into any swap, hedge or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of the KBS REIT Properties III LLC Lock-up Units (including any securities convertible into or exercisable or exchangeable for any KBS REIT Properties III LLC Lock-up Units or which carry rights to subscribe for or purchase any such KBS REIT Properties III LLC Lock-up Units);
|
(c)
|
enter into any transaction (including a derivative transaction) or other arrangement with a similar economic effect to the foregoing sub-paragraph (a) or (b);
|
(d)
|
deposit any of its effective interest in the KBS REIT Properties III LLC Lock up Units (including any securities convertible into or exercisable or exchangeable for any KBS REIT Properties III LLC Lock-up Units or which carry rights to subscribe for or purchase any such KBS REIT Properties III LLC Lock-up Units) in any depository receipt facility;
|
(e)
|
enter into a transaction which is designed or which may reasonably be expected to result in any of the above; or
|
(f)
|
publicly announce any intention to do any of the above,
|
537518-48535-v2.1
|
‑
2
‑
|
17-40684037
|
3.
|
The above restrictions in paragraph 2 shall not apply to prohibit KBS REIT Properties III, LLC from being able to:
|
(a)
|
create a charge over the KBS REIT Properties III LLC Lock-up Units or otherwise grant of security over or creation of any encumbrance over the KBS REIT Properties III LLC Lock-up Units, provided that such charge, security or encumbrance (i) cannot be enforced over any KBS REIT Properties III LLC Lock-up Units during the First Lock-up Period, and (ii) can only be enforced with respect to 50.0% of the effective interest in the KBS REIT Properties III LLC Lock-up Units during the Second Lock-up Period. The charge, security or encumbrance will only be created if the charge (such as a bank or financial institution) agrees that the charge, security or encumbrance over the KBS REIT Properties III LLC Lock-up Units cannot be enforced over 100.0% of the KBS REIT Properties III LLC Lock-up Unit during the First Lock-up Period and can only be enforced in relation to 50.0% of the effective interest in the KBS REIT Properties III LLC Lock-up Units during the Second Lock-up Period;
|
(b)
|
enter into any unit lending agreement with the Joint Bookrunners and Underwriters or any sale or transfer of the KBS REIT Properties III LLC Lock up Units by KBS REIT Properties III LLC pursuant to the exercise of an over allotment option granted by the Unit Lender to the Joint Bookrunners and Underwriters; and
|
(c)
|
transfer the KBS REIT Properties III LLC Lock-up Units to and between KBS REIT Properties III LLC or any direct and indirect wholly-owned subsidiaries of KBS REIT Properties III LLC, provided that KBS REIT Properties III LLC shall, during the First Lock-up Period, maintain a direct or indirect interest in 100.0% of the KBS REIT Properties III LLC Lock-up Units and, during the Second Lock-up Period, maintain a direct or indirect interest in 50.0% of the KBS REIT Properties III LLC Lock-up Units and KBS REIT Properties III LLC has procured that such transferee subsidiaries have executed and delivered to the Joint Bookrunners and Underwriters undertakings to the effect that such transferee subsidiaries will comply with such restrictions so as to enable KBS REIT Properties III LLC to comply with the foregoing restrictions for the unexpired period of the First Lock-up Period and the Second Lock-up Period.
|
4.
|
For the avoidance of doubt, any Units returned to KBS REIT Properties III LLC pursuant to any unit lending agreement with the Joint Bookrunners and Underwriters shall be subject to the restrictions set out in this letter agreement as if they were KBS REIT Properties III LLC Lock-up Units.
|
5.
|
If, for any reason, the Offering is not completed within six months of the date of the Prospectus, this letter agreement shall be terminated immediately.
|
6.
|
A person who is not a party to this letter agreement shall have no rights under the Contracts (Rights of Third Parties) Act (Chapter 53B of Singapore) to enforce any term of this letter agreement.
|
7.
|
This undertaking is given in favour of the Joint Bookrunners and Underwriters, and accordingly, may be enforced by the Joint Bookrunners and Underwriters. Without prejudice to any other rights or remedies which the Joint Bookrunners and Underwriters may have, we acknowledge and agree that damages may not be an adequate remedy for any breach of this undertaking and the Joint Bookrunners and Underwriters shall be entitled to seek the remedies of injunction, specific performance and other equitable relief for any threatened or actual breach of this undertaking.
|
537518-48535-v2.1
|
‑
3
‑
|
17-40684037
|
8.
|
This letter agreement is governed by, and shall be construed in accordance with, the laws of Singapore.
|
9.
|
Both parties agree that the courts of Singapore are to have non-exclusive jurisdiction to settle any dispute (including claims for set-off and counter claims) which may arise in connection with the creation, validity, effect, interpretation, or performance of, or of legal relationships established by, this letter agreement or otherwise arising in connection with this letter agreement.
|
537518-48535-v2.1
|
‑
4
‑
|
17-40684037
|
By:
|
KBS LIMITED PARTNERSHIP III,
|
By:
|
KBS REAL ESTATE INVESTMENT TRUST III, INC.,
|
By:
|
/s/ Charles J. Schreiber, Jr.
|
1.
|
I have reviewed this quarterly report on Form 10-Q of KBS Real Estate Investment Trust III, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
August 9, 2019
|
By:
|
/
S
/ C
HARLES
J. S
CHREIBER
, J
R
.
|
|
|
|
Charles J. Schreiber, Jr.
|
|
|
|
Chairman of the Board,
Chief Executive Officer and Director
|
|
|
|
(principal executive officer)
|
1.
|
I have reviewed this quarterly report on Form 10-Q of KBS Real Estate Investment Trust III, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
August 9, 2019
|
By:
|
/S/
J
EFFREY
K. W
ALDVOGEL
|
|
|
|
Jeffrey K. Waldvogel
|
|
|
|
Chief Financial Officer, Treasurer and Secretary
|
|
|
|
(principal financial officer)
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.
|
Date:
|
August 9, 2019
|
By:
|
/
S
/ C
HARLES
J. S
CHREIBER
, J
R
.
|
|
|
|
Charles J. Schreiber, Jr.
|
|
|
|
Chairman of the Board,
Chief Executive Officer and Director
|
|
|
|
(principal executive officer)
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Registrant.
|
Date:
|
August 9, 2019
|
By:
|
/S/
J
EFFREY
K. W
ALDVOGEL
|
|
|
|
Jeffrey K. Waldvogel
|
|
|
|
Chief Financial Officer, Treasurer and Secretary
|
|
|
|
(principal financial officer)
|