<PAGE>
EXHIBIT 2.1
AMENDMENT NO. 1 TO PURCHASE AND SALE AGREEMENT
This AMENDMENT NO. 1, dated as of September 6, 2000 ("Amendment No. 1"), to
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that certain Purchase and Sale Agreement, dated as of July 10, 2000 (the
"Purchase and Sale Agreement"), by and among BRE Properties, Inc., a Maryland
corporation ("BRE"), BRE Property Investors LLC, a Delaware limited liability
---
company ("DownREIT", and together with BRE, "Sellers") and G&I III Residential
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One LLC, a Delaware limited liability company ("Purchaser"). Capitalized terms
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used but not otherwise defined herein shall have the meanings assigned to them
in the Purchase and Sale Agreement.
WITNESSETH:
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WHEREAS, Sellers and Purchaser have entered into the Purchase and Sale
Agreement; and
WHEREAS, Sellers and Purchaser now desire to amend the Purchase and Sale
Agreement as provided herein.
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, and intending to be legally bound hereby, the parties hereto agree
to amend the Purchase and Sale Agreement as follows:
1. Section 1.1(d) is hereby amended by deleting such Section 1.1(d) in
its entirety and adding, in lieu thereof, a new Section 1.1(d) to read as
follows:
(d) Purchase Price: $280,000,000, of which $261,000,000 will be due at the
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First Closing (the "First Closing Purchase Price"),
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and $19,000,000 will be due at the Second Closing (the
"Second Closing Purchase Price").
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2. Section 1.1(f) is hereby amended by deleting such Section 1.1(f) in
its entirety and adding, in lieu thereof, a new Section 1.1(f) to read as
follows:
(f) Deposit: Cash in the amount of $1,500,000, all of which has
------- been released to BRE, comprised of $1,300,000 (the
"First Closing Deposit") and $200,000 (the "Second
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Closing Deposit").
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<PAGE>
3. Section 1.1(g) is hereby amended by deleting such Section 1.1(g) in
its entirety and adding, in lieu thereof, a new Section 1.1(g) to read as
follows:
(g) Closing Dates: First Closing Date: September 13, 2000. Second
------------- Closing Date: As soon as practicable after all
required HUD loan assumption approvals for Hacienda
Del Rio Apartments and Fountain Plaza Apartments are
obtained, but not later than October 25, 2000 unless
the parties hereto mutually agree to extend such date
as needed.
4. Section 1.1(h) is hereby amended by deleting such Section 1.1(h) in
its entirety and adding, in lieu thereof, a new Section 1.1(h) to read as
follows:
(h) Termination: Except as may be required in order to enable Purchaser
----------- to enforce its right to specific performance pursuant
to Section 8.2 of this Agreement, this Agreement will
automatically terminate (1) as to all the Properties,
if the First Closing shall not have occurred by 5:00
p.m. Eastern Time on September 13, 2000, and (2) as to
the Second Closing Properties, if the Second Closing
shall not have occurred by 5:00 p.m. Eastern Time on
October 25, 2000.
5. Section 1.1 is amended by the insertion of a new Section 1.1(j), such
Section 1.1(j) to read as follows:
(j) Properties: The First Closing Properties, listed on Exhibit B-1
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hereto, to be sold in the First Closing. The Second
Closing Properties, listed on Exhibit B-2 hereto, to
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be sold in the Second Closing.
6. Section 1.3 is hereby amended by deleting such Section 1.3 in its
entirety and adding, in lieu thereof, a new Section 1.3 to read as follows:
1.3 Deposit. Concurrently with the execution of this Agreement,
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Purchaser has paid the Deposit to BRE, evidencing Purchaser's good faith to
perform its obligations under this Agreement. Subject to Section 8.1
hereof, the First Closing Deposit (plus interest from the date of this
Agreement to the First Closing Date at the prime rate announced from time
to time by Chase Manhattan Bank, New York, New York) shall be credited
toward the First Closing Purchase Price on the First Closing. Subject to
Section 8.1 hereof, the Second Closing Deposit (plus interest from the date
of the Agreement to the Second Closing Date at the prime rate announced
from time to time by Chase Manhattan Bank, New York, New York) shall be
credited toward the Second Closing Purchase Price on the Second Closing.
Neither the First Closing Deposit nor the Second Closing Deposit shall be
refundable to Purchaser except as expressly provided in Section 8.3 of this
Agreement.
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<PAGE>
7. Section 1.4 is hereby amended by deleting such Section 1.4 in its
entirety and adding, in lieu thereof, a new Section 1.4 to read as follows:
Section 1.4 Master LLC and Master LLC Agreement. Purchaser shall
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have the right to assign all of its rights and obligations under this
Agreement to a limited liability company (the "Master LLC") governed by a
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limited liability company agreement (the "Master LLC Agreement")
--------------------
substantially in the form of the Master LLC Agreement attached hereto as
Exhibit H, with such changes as may be required by local law or Purchaser's
---------
lenders (provided, however, that any such changes shall be subject to the
approval of each of the parties hereto, which approval will not be
unreasonably withheld). If Purchaser does not so assign all of its rights
and obligations under this Agreement to the Master LLC, Purchaser shall
contribute the Properties to the Master LLC. Simultaneously with Sellers'
transfer of the First Closing Properties to Purchaser (or the applicable
Subsidiary LLC, pursuant to Section 1.5 below), but as part of the First
Closing on the First Closing Date, in exchange for a pro rata number of
membership units in the Master LLC, BRE agrees to contribute (the "First
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Contribution") to the Master LLC the lesser of (i) cash in the amount of
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15% of the difference between the First Closing Purchase Price and the debt
encumbering the First Closing Properties at the time of such contribution
and (ii) $12,750,000. Simultaneously with the Sellers' transfer of the
Second Closing Properties to Purchaser (or the applicable Subsidiary LLC,
pursuant to Section 1.5 below), but as part of the Second Closing on the
Second Closing Date, in exchange for a pro rata number of membership units
in the Master LLC, BRE agrees to contribute to the Master LLC the lesser of
(i) cash in the amount of 15% of the difference between the Second Closing
Purchase Price and the debt encumbering the Second Closing Properties at
the time of such contribution and (ii) $12,750,000 minus the First
Contribution.
8. Section 4.1 is hereby amended by deleting such Section 4.1 in its
entirety and adding, in lieu thereof, a new Section 4.1 to read as follows:
4.1 Closing. The consummation of the transaction contemplated
-------
herein ("Closing") shall occur on two separate dates. The First Closing,
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with respect to the First Closing Properties, shall occur on the First
Closing Date at the offices of Blank Rome Tenzer Greenblatt LLP, New York,
New York or at such other time or place as Sellers and Purchaser may agree.
The Second Closing, with respect to the Second Closing Properties, shall
occur on the Second Closing Date at the offices of Blank Rome Tenzer
Greenblatt LLP, New York, New York or at such other time or place as
Sellers and Purchaser may agree.
9. Section 6.3(f)(vi) is hereby amended by deleting such Section
6.3(f)(vi) in its entirety.
10. Section 6.3(f)(viii) is hereby amended by deleting such Section
6.3(f)(viii) in its entirety.
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<PAGE>
11. Article X (Miscellaneous) is hereby amended by inserting a new Section
10.20, such new Section 10.20 to read as follows:
10.20 Proceeding In Respect of Colonia Del Rio Apartments.
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(a) The parties hereto acknowledge that Pima County, Arizona
previously filed a lawsuit to condemn a portion of the property associated
with the Colonial Del Rio Apartments, and has since dismissed the lawsuit
and is seeking to acquire the same Property by purchase in lieu of
condemnation, as disclosed in Exhibit J (such lawsuit or purchase, the
---------
"Proceeding"). BRE agrees that, on the Second Closing, it will assign,
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transfer and set over to Purchaser all of its right, title and interest in
and to the Proceeding and any award received or to be received from Pima
County, Arizona in respect of the proceeding (the "Award").
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(b) If, on or before the Second Closing, the Award has been
actually received, or the Award has not been actually received but the
amount of the Award has been finally determined, Purchaser shall be
entitled to an offset against the Second Closing Purchase Price in an
amount equal to the difference between (i) the Award and (ii) $400,000;
provided, however, that if the Award exceeds $400,000, Purchaser shall
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not be entitled to any such offset against the Second Closing Purchase
Price. If, on or before the Second Closing, the Award has not been actually
received and the amount of the Award has not been finally determined, then
the parties shall confer in good faith to agree on an amount to which
Purchaser shall be entitled as an offset against the Second Closing
Purchase Price, such amount to be equal to the difference between the
anticipated Award and $400,000; provided, however, that if the anticipated
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Award exceeds $400,000, Purchaser shall not be entitled to any such offset
against the Second Closing Purchase Price. In no event shall Purchaser's
offset against the Second Closing Purchase Price exceed the difference
between the Award or the anticipated Award, as the case may be, and
$400,000. Sellers shall pay all reasonable legal fees incurred by Purchaser
in connection with the Proceeding and the collection of the Award.
12. Unless otherwise specified in this Amendment No. 1, (i) all references
in the Agreement to the "Closing" or "Closing Date" shall be deemed to refer to
the First Closing or the Second Closing, as required by the context; (ii) all
references to the "Properties" shall be deemed to refer to the First Closing
Properties or the Second Closing Properties, as required by the context; and
(iii) all references to the "Deposit" shall be deemed to refer to the First
Closing Deposit or the Second Closing Deposit, as required by the context.
13. With respect to the Master LLC Agreement referenced in Section 1.4 and
the Subsidiary LLC Agreement referenced in Section 1.5, the parties hereto
mutually agree to amend such Master LLC Agreement and Subsidiary LLC Agreements
as necessary to reflect the parties' intent as represented by this Amendment No.
1.
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<PAGE>
14. The terms and provisions set forth in this Amendment No. 1 shall
modify and supersede all inconsistent terms and provisions set forth in the
Purchase and Sale Agreement. Except as expressly modified in this Amendment No.
1, the terms and provisions of the Purchase and Sale Agreement are hereby
ratified and confirmed and the Purchase and Sale Agreement as amended hereby
shall continue to be the legal, valid and binding obligation of the parties
hereto, enforceable in accordance with its terms.
15. This Amendment No. 1 shall be governed by and construed in accordance
with the laws of the State of California, without regard to such State's
conflict of laws principles; provided however, that the Deeds shall be governed
by and construed in accordance with the laws of the respective state of
recordation.
16. This Amendment No. 1 may be validly executed in one or more
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Amendment No.
1 to be duly executed and delivered as of the date first above written.
BRE PROPERTIES, INC.,
a Maryland corporation
By: /s/ LeRoy E. Carlson
--------------------
Name: LeRoy E. Carlson
Title: Executive Vice President and Chief Operating Officer
BRE PROPERTY INVESTORS LLC,
a Delaware limited liability company
By: BRE Properties, Inc., its managing member
By: /s/ LeRoy E. Carlson
--------------------
Name: LeRoy E. Carlson
Title: President and Chief Operating Officer
G & I III RESIDENTIAL ONE LLC,
a Delaware limited liability company
By: DRA GROWTH AND INCOME FUND III, LLC, a Delaware limited
liability company
By: G&I III MANAGECO, LP, a Delaware limited
partnership
By: MANAGECO IV, INC., a Delaware corporation
By: /s/ Francis X. Tansey
---------------------
Name: Francis X. Tansey
Title: President
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<PAGE>
EXHIBIT B-1
FIRST CLOSING PROPERTIES
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PROPERTIES*
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<TABLE>
<CAPTION>
Property Location Seller
<S> <C> <C>
Shadow Bend Phoenix, AZ BRE
Fairway Crossings Phoenix, AZ BRE
Posada Del Este Phoenix, AZ BRE
Park Scottsdale Phoenix, AZ BRE
Springhill Tucson, AZ BRE
Casas Lindas Tucson, AZ BRE
Camino Seco Village Tucson, AZ BRE
Oracle Village Tucson, AZ BRE
Pinnacle Heights Tucson, AZ DownREIT
Pinnacle Canyon Tucson, AZ DownREIT
Cypress Springs Las Vegas, NV BRE
Tango Las Vegas, NV BRE
Desert Lakes Las Vegas, NV BRE
Talavera Las Vegas, NV BRE
Pinnacle Flamingo West Las Vegas, NV DownREIT
Pinnacle at High Desert Albuquerque, NM DownREIT
Pinnacle View Albuquerque, NM DownREIT
Pinnacle Estates Albuquerque, NM DownREIT
Pinnacle High Resort Albuquerque, NM DownREIT
</TABLE>
* SEE LEGAL DESCRIPTIONS IN TITLE COMMITMENT FOR MORE PRECISE DESCRIPTION
7
<PAGE>
EXHIBIT B-2
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SECOND CLOSING PROPERTIES
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PROPERTIES*
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<TABLE>
<CAPTION>
Property Location Seller
<S> <C> <C>
Hacienda del Rio Tucson, AZ BRE
Colonia del Rio Tucson, AZ BRE
Fountain Plaza Tucson, AZ BRE
</TABLE>
* SEE LEGAL DESCRIPTIONS IN TITLE COMMITMENT FOR MORE PRECISE DESCRIPTION
8
