SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 8, 1998
CARLYLE REAL ESTATE LIMITED PARTNERSHIP - VII
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(Exact name of registrant as specified in its charter)
Illinois 0-8915 36-2875192
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(State or other) (Commission (IRS Employer
Jurisdiction of File Number) Identification No.)
Organization
900 N. Michigan Avenue, Chicago, Illinois 60611-1575
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(Address of principal executive office)
Registrant's telephone number, including area code: (312) 915-1987
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OAKRIDGE ASSOCIATES
San Jose, California
ITEM 2. ACQUISITION OR DISPOSITION OF ASSET. Carlyle Real Estate Limited
Partnership - VII (the "Partnership") was a partner in Oakridge Associates,
a California general partnership (the "Venture") with an unaffiliated
venture partner, Trizechahn Centers Inc. (the "Venture Partner"). The
Venture owned a leasehold interest in the land and improvements known as
Oakridge Mall in San Jose, California (the "Property"). The Partnership
had been in discussions with potential buyers for the Property (on behalf
of the venture) or the Partnership's interest in the Property. Per the
Venture agreement, the Venture Partner in Oakridge Associates held the
right of first opportunity to purchase the Partnership's interest in the
Venture had the Partnership pursued a sale of the Property. Pursuant to
the Venture agreement, if the Venture Partner elected to exercise its right
of first opportunity, the Venture Partner would then have 90 days after
making such an election to close such sale. The purchase price of the
Partnership's interest would be such as would produce for the Partnership
the same consideration as the sale of the property to an unaffiliated third
party. In March 1998, the Partnership and the Venture Partner reached an
agreement in principle to sell the Partnership's interest in the Venture to
the Venture Partner. On April 8, 1998, the Partnership sold its interest
to the Venture Partner. At the time of the sale, Oakridge Mall was 94%
occupied. The purchase price of the interest was $31,950,000 ($20,700,000
plus the assumption of the Partnership's share of the mortgage loan of
approximately $11,250,000). The Partnership received approximately
$20,900,000 in cash at closing including a distribution of previously
undistributed cash flow from operations of approximately $494,000 and
adjustments for prorations and closing costs, but before consideration of
certain costs of sale incurred by the Partnership, including a sale
commission, if any, due to the General Partner. Pursuant to the sale
agreement, a cash reserve of $250,000 was established to pay for certain
costs that may be incurred related to certain maintenance items at the
Property. Any funds remaining in the cash reserve at December 1, 1998 will
be distributed one-half to the Partnership and one-half to the Venture
Partner. As a result of this transaction, the Partnership recognized a
gain of approximately $23,000,000 for financial reporting purposes and
expects to realize a gain of approximately $24,000,000 for Federal income
tax purposes in 1998. In addition, in connection with the sale of the
Partnership's interest in the Venture and as is customary in such
transactions, the Partnership agreed to certain representations, warranties
and covenants with a stipulated survival period which expires December 1,
1998. Although it is not expected, the Partnership may ultimately have
some liability under such representations, warranties and covenants which
are limited to actual damages and shall in no event exceed $1,000,000.
Additionally, the Partnership provided a representation regarding its title
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relating to its Partnership Interest in the Venture. Such representation
is for the full sale price of the interest and also expires December 1,
1998.
The Partnership Agreement provides that the net sale proceeds be
distributed 85% to the Limited Partners and 15% to the General Partners.
The Partnership's interest in the Venture was its only remaining
investment and due to its sale, the Partnership intends to wind up its
affairs and liquidate by year end. The Partnership will distribute its
remaining cash after payment of expenses and liabilities. During 1998, it
is currently expected that the Partnership will distribute sale and final
liquidating distributions in the aggregate in excess of $1000 per Limited
Partnership Interest. However, this is an estimate only and the sale and
final liquidating distribution to the Limited Partners, which will depend
on, among other things, amounts needed to pay or provide for the
Partnership's remaining expenses and liabilities, may vary from such
estimate.
ITEM 7: FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements. Not applicable
(b) Proforma financial information - Narrative
As a result of the sale of the Partnership's interest in the Venture
there will be no further rental and other income, mortgage and other
interest, property operating expenses or amortization of deferred expenses
or venture partner's share of venture's operations which for the
Partnership's most recent fiscal year (the year ended December 31, 1997)
were approximately $10,250,000, $2,182,000, $4,424,000, $246,000 and
$(1,699,000), respectively. Such operating results reflect the
classification of the Property as held for sale or disposition as of
December 31, 1996 and therefore not subject to continued depreciation as of
such date. Additionally, there will be no further assets and liabilities
related to the joint venture, which at December 31, 1997 consisted of
property held for sale or disposition of approximately $16,149,000, venture
partner's deficit in venture of approximately $1,473,000, deferred expenses
and other long-term assets of approximately $2,425,000, cash and other
current assets of approximately $2,076,000, current portion of long-term
debt of approximately $23,002,000, other current liabilities of
approximately $1,212,000, and tenant security deposits of approximately
$55,000.
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(c) Exhibits.
10.1 Oakridge Agreement for Purchase and Sale of Partnership
Interest between Carlyle Real Estate Limited Partnership-VII, as Seller and
Trizechahn Centers Inc., as buyer relating to Oakridge Associates, a
California general partnership, dated April 8, 1998, and exhibits thereto.
10.2 Assignment and Assumption of Partnership Interest by and
between Carlyle Real Estate Limited Partnership-VII and Hahn Capital
Corporation, dated April 8, 1998.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Company has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CARLYLE REAL ESTATE LIMITED PARTNERSHIP - VII
BY: JMB Realty Corporation
(Corporate General Partner)
By: GAILEN J. HULL
Gailen J. Hull, Senior Vice President
Date: April 23, 1998
EXHIBIT 10.1
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OAKRIDGE AGREEMENT FOR
PURCHASE AND SALE OF PARTNERSHIP INTEREST
between
CARLYLE REAL ESTATE LIMITED PARTNERSHIP-VII,
as SELLER
and
TRIZECHAHN CENTERS INC.,
as BUYER
relating to
OAKRIDGE ASSOCIATES,
a California general partnership
EFFECTIVE AS OF APRIL 3, 1998
[DRAFT DATED APRIL 2, 1998]
<PAGE>
TABLE OF CONTENTS
Section Page
1. DEFINITIONS 2
1.1 Affiliate 2
1.2 Agreement 2
1.3 Business 2
1.4 Buyer 2
1.5 Omitted 2
1.6 Omitted 2
1.7 Cash 2
1.8 Close of Escrow or Closing 2
1.9 Omitted 2
1.10 Condemnation 2
1.11 Escrow 2
1.12 Escrow Holder 2
1.13 Governmental Body 3
1.14 Indemnified Party 3
1.15 Indemnifying Party 3
1.16 Major Damage or Destruction 3
1.17 Management Agreement 3
1.18 Manager 3
1.19 Omitted 3
1.20 Omitted 3
1.21 Omitted 3
1.22 Partnership 3
1.23 Partnership Agreement 3
1.24 Omitted 3
1.25 Partnership Property 3
1.26 Business Property 3
1.27 Purchase Price 3
1.28 Scheduled Closing Date 4
1.29 Seller 4
1.30 Seller's Partnership Interest 4
2. PURCHASE AND SALE 4
2.1 Purchase of Partnership Interest 4
2.2 Purchase Price and Payment 4
2.3 Closing 4
2.4 Partnership Distributions 4
3. REPRESENTATIONS AND WARRANTIES OF SELLER 5
3.1 Partnership Interest 5
3.2 Partnership Interest Ownership 5
3.3 Entity Standing 5
3.4 Authority 5
3.5 Consents; Conflicts 5
3.6 Brokers or Finders 5
3.7 Litigation 6
3.8 No Untrue Statements 6
3.9 Agreements 6
3.10 Title to Business Property 6
4. REPRESENTATIONS AND WARRANTIES OF BUYER 6
4.1 Corporate Standing 6
4.2 Authority 6
4.3 Consents; Conflicts 6
4.4 Omitted 7
4.5 Brokers or Finders 7
5. DELIVERIES TO ESCROW AND CONDUCT BEFORE CLOSING 7
5.1 Deliveries by Seller 7
5.2 Deliveries by Buyer 7
5.3 Cooperation and Further Assurances 8
6. CONDITIONS TO CLOSING 8
6.1 For Buyer 8
6.2 For Seller 8
7. CLOSING 9
7.1 Supplemental Escrow Instructions 9
7.2 Closing Procedures 9
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8. CONDEMNATION, DAMAGE OR DESTRUCTION 9
8.1 Condemnation 9
8.2 Damage or Destruction 9
9. PARTIES' OBLIGATIONS AFTER CLOSING 10
9.1 Cooperation Regarding Tax Returns 10
9.2 Expenses of Parties 10
9.3 Indemnification 10
9.4 Procedure for Indemnification 10
10. ARBITRATION OF DISPUTES 11
11. MUTUAL RELEASES 14
11.1 TrizecHahn Release 14
11.2 JMB Release 14
11.3 Civil Code Section 1542 15
12. MISCELLANEOUS PROVISIONS 15
12.1 Notice and Cure Rights 15
12.2 Refraining from Legal Proceedings 16
12.3 Assignment 16
12.4 Amendment, Modification and Waiver 16
12.5 Partial Invalidity 16
12.6 No Third Party Beneficiary 17
12.7 Notices 17
12.8 Time of Essence 18
12.9 Governing Law 18
12.10 Remedies 18
12.11 Attorneys' Fees 18
12.12 Expenses of Parties 19
12.13 Further Assurances 19
12.14 Headings 19
12.15 Gender 19
12.16 Fair Meaning 19
12.17 Binding Effect 19
12.18 Counterparts and Facsimiles 19
12.19 Entire Agreement 19
12.20 Limitation on Liability; Survival of Claims 20
12.21 Tax Structure of Purchase 22
12.22 Confidentiality 22
12.23 Costs and Expenses; Prorations 22
12.24 Cash Reserve 23
12.25 Waiver of Right of First Refusal 24
TABLE OF EXHIBITS
1. ASSIGNMENT OF PARTNERSHIP INTERESTS
2. OMITTED
3. JMBAUTHORIZING RESOLUTION
4. BUYER AUTHORIZING RESOLUTION
5. OMITTED
6. CERTIFICATE OF NON-FOREIGN STATUS
<PAGE>
OAKRIDGE AGREEMENT FOR
PURCHASE AND SALE OF PARTNERSHIP INTEREST
THIS OAKRIDGE AGREEMENT FOR PURCHASE AND SALE OF PARTNERSHIP INTEREST
(the "Purchase Agreement" or "Agreement") is made and entered into on April
3, 1998 (the "Effective Date"), by the following party, hereinafter
referred to as "Seller":
CARLYLE REAL ESTATE LIMITED PARTNERSHIP-VII, an Illinois limited
partnership;
and also by the following party, hereinafter referred to as "Buyer":
TRIZECHAHN CENTERS INC., a California corporation, formerly known as
ERNEST W. HAHN, INC., a California corporation.
R E C I T A L S :
A. PARTNERSHIP. Seller and Buyer together constitute all of the
partners in Oakridge Associates, a California general partnership (the
"Partnership"). The Partnership was formed by Articles of Partnership made
and entered into as of October 15, 1977 (the "Partnership Agreement"). The
Partnership Agreement is in full force and effect and has not been amended.
The defined terms in the Partnership Agreement are incorporated herein by
reference.
B. BUSINESS PROPERTY. The principal asset of the Partnership is
the Business Property, as defined in the Partnership Agreement. It
consists of certain real and personal property in San Jose, California,
which, together with improvements owned by department stores on certain
parcels, is commonly known as "Oakridge Mall." All of the real and
personal property assets of the Partnership, individually and collectively,
including, but not limited to, the Business Property, are referred to in
this Agreement as the "Partnership Property."
C. PURPOSE. Seller desires to sell, and Buyer desires to
purchase, all of Seller's interest in the Partnership, consisting of all of
its general partnership interest in the Partnership, including, without
limitation, all of its interest in capital, profits, liquidation proceeds,
distributions and all other rights and interests under the Partnership
Agreement or relating to the Partnership (collectively, "Seller's
Partnership Interest"), on the terms and conditions set forth in this
Agreement.
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A G R E E M E N T :
NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties agree
as follows:
DEFINITIONS. As used in this Agreement, the following terms
shall have the meanings ascribed to them in this Section 1:
1.1 AFFILIATE. Any person or entity who directly or
indirectly controls, is controlled by or is under common control with the
specified person. By way of example and without limiting the generality of
the foregoing, where a determination is being made as to whether two
corporations are Affiliates, the "direct control" test is met, and
accordingly they are Affiliates, if one of those corporations controls or
is controlled by the other, and the "indirect control" test is met, and
accordingly they are Affiliates, if both of those corporations are in a
chain of Affiliated corporations ultimately controlled by a common parent
one or more tiers above them.
1.2 AGREEMENT. This Purchase Agreement, including all
amendments hereto, and all exhibits referred to herein.
1.3 BUSINESS. The business operated and conducted by
the Partnership on the date of this Agreement, including, without
limitation, the ownership, operation, leasing and subleasing of the
Business Property.
1.4 BUYER. TrizecHahn Centers Inc., a California
corporation.
1.5 OMITTED.
1.6 OMITTED.
1.7 CASH. (i) Currency, (ii) checks currently dated
and honored upon presentation for payment, or (iii) amounts credited by
wire-transfer into the bank accounts of the payee.
1.8 CLOSE OF ESCROW OR CLOSING. The date upon which
Buyer deposits the Purchase Price, plus or minus Buyer's and Seller's
respective shares of costs and prorations as set forth in Section 12.23,
into Escrow by wire transfer of immediately available federal funds.
<PAGE>
1.9 OMITTED.
1.10 CONDEMNATION. Any taking of the Business Property
or any part thereof by condemnation or by exercise of any right of eminent
domain or threat thereof, or by any similar proceeding or act of any
Governmental Body.
1.11 ESCROW. The escrow established with Escrow Holder
pursuant to the terms of this Agreement.
1.12 ESCROW HOLDER. First American Title Guaranty
Company.
1.13 GOVERNMENTAL BODY. Any domestic or foreign
national, state, municipal or other local government or multi-national
body, any subdivision, agency, commission or authority thereof, or any
quasi-governmental or private body exercising any regulatory or taxing
authority thereunder.
1.14 INDEMNIFIED PARTY. The indemnified party as
defined in Section 9.4.1 below.
1.15 INDEMNIFYING PARTY. The indemnifying party as
defined at Section 9.4.1 below.
1.16 MAJOR DAMAGE OR DESTRUCTION. Damage or destruction
at the Business Property for which repair costs are estimated to exceed
$250,000.
1.17 MANAGEMENT AGREEMENT. The Management Agreement
[for] Oakridge Mall dated October 15, 1977, by and between the Partnership
and the Manager.
1.18 MANAGER. TrizecHahn Centers Inc., a California
corporation.
1.19 OMITTED.
1.20 OMITTED.
<PAGE>
1.21 OMITTED.
1.22 PARTNERSHIP. Oakridge Associates, a California
general partnership.
1.23 PARTNERSHIP AGREEMENT. The Articles of Partnership
of Oakridge Associates, a California general partnership, dated October 15,
1977.
1.24 OMITTED.
1.25 PARTNERSHIP PROPERTY. This term is defined in
Recital B.
1.26 BUSINESS PROPERTY. This term is defined in
Recital B.
1.27 PURCHASE PRICE. The purchase price as defined at
Section 2.2.1 below.
1.28 SCHEDULED CLOSING DATE. April 20, 1998; provided,
however, that Buyer may elect to move the Scheduled Closing Date to an
earlier date by providing three (3) business days prior written notice
thereof to Seller and Escrow Holder.
1.29 SELLER. Carlyle Real Estate Limited Partnership -
VII, an Illinois limited partnership.
1.30 SELLER'S PARTNERSHIP INTEREST. This term is
defined in Recital C.
2. PURCHASE AND SALE.
2.1 PURCHASE OF PARTNERSHIP INTEREST. Subject to the
terms and conditions of this Purchase Agreement, and in reliance upon the
representations and warranties herein, on the Scheduled Closing Date,
Seller shall sell Seller's Partnership Interest to Buyer, and Buyer shall
purchase Seller's Partnership Interest from Seller.
<PAGE>
2.2 PURCHASE PRICE AND PAYMENT.
2.2.1 AMOUNT. The aggregate purchase price for
Seller's Partnership Interest shall be Twenty Million Seven Hundred
Thousand Dollars ($20,700,000) (the "Purchase Price").
2.2.2 PAYMENT. Buyer shall pay the Purchase Price,
plus or minus Buyer's and Seller's respective shares of costs and
prorations as set forth in Section 12.23, to Seller by wire transfer or
immediately available funds on the Scheduled Closing Date.
2.3 CLOSING.
2.3.1 PLACE. The Closing shall take place on the
Scheduled Closing Date through escrow ("Escrow") with the Escrow Holder.
2.3.2 CONDUCT PENDING CLOSING. Neither Buyer nor
Seller shall, except with the prior written consent of the other, (i) amend
the Partnership Agreement, sell or refinance the Business Property, or
engage in any other act outside the ordinary course of business of the
Partnership, or (ii) make or consent to the making of any distributions by
the Partnership to any of the Partners, except as set forth in
Section 12.23.4 below. In all other respects, during the term of this
Agreement, the parties shall continue to conduct their affairs in relation
to the Partnership and Partnership Property in a manner consistent with the
Partnership Agreement.
2.4 PARTNERSHIP DISTRIBUTIONS. Partnership
distributions shall be governed by Section 12.23.4 below.
3. REPRESENTATIONS AND WARRANTIES OF SELLER. Seller
represents and warrants to Buyer as follows:
3.1 Partnership Interest. Seller's Partnership
Interest constitutes the entire interest in the Partnership, the Business,
the Business Property and the Partnership Property of Seller.
3.2 PARTNERSHIP INTEREST OWNERSHIP. Subject only to
the terms of the Partnership Agreement, Seller's Partnership Interest is
free and clear of all mortgages, pledges, liens, security interests,
conditional sales agreements, claims, rights of third parties, charges,
encumbrances and restrictions of every kind and nature.
<PAGE>
3.3 ENTITY STANDING. Seller and its general partner,
JMB Realty Corporation, a Delaware corporation ("JMB") are each duly
organized and validly existing under the laws of the State of Illinois and
the State of Delaware, respectively, and have all requisite power and
authority to carry on their businesses as currently conducted.
3.4 AUTHORITY. Seller and JMB each has the requisite
power and authority to enter into this Agreement and to sell or cause
Seller to sell Seller's Partnership Interest. Seller and JMB have taken
all such actions as may be necessary and proper to authorize this
Agreement, their execution and delivery hereof, their consummation of the
transactions contemplated hereby and their execution and delivery of each
of the documents required to be delivered hereunder. This Agreement has
been duly executed and delivered by them and is valid, binding and
enforceable against them in accordance with its terms.
3.5 CONSENTS; CONFLICTS. The execution and delivery of
this Agreement by Seller and JMB and the consummation by Seller of the
transactions provided hereunder, (i) do not require any third party
consent, or notice to any third party, or any permit, authorization or
filing with any Governmental Body (other than those the failure of which to
obtain would not have a material adverse effect on Buyer), (ii) will not
violate the respective charter documents of Seller or JMB (articles of
incorporation and bylaws in the case of JMB, and limited partnership
agreement in the case of Seller), each as the same may have been amended
from time to time, and (iii) will not violate, conflict with, result in the
breach of, or cause the acceleration of or default under any provision of
any material agreement, law, order, arbitration award, judgment or decree
to which Seller or JMB is a party (collectively or individually) or by
which Seller or JMB is subject or bound.
3.6 BROKERS OR FINDERS. Except as set forth in
Section 12.23.1 below, neither Seller, nor any of its agents, has incurred
any obligation or liability, contingent or otherwise, for brokerage or
finders' fees or agents' commissions or other like payment in connection
with this Agreement, and Seller will indemnify and hold Buyer harmless from
any such payment alleged to be due by or through Seller as a result of the
action of Seller or its agents.
3.7 LITIGATION. There is not pending nor, to the best
of Seller's knowledge, threatened, any litigation, proceeding or
investigation (i) relating to Seller's title to Seller's Partnership
Interest which may adversely affect the transaction contemplated by this
Agreement, or (ii) relating to Seller in its capacity as a partner in the
Partnership which may adversely affect the transaction contemplated by this
Agreement, or (iii) relating to Seller in any capacity OTHER THAN as a
partner in the Partnership which may materially adversely affect the
transaction contemplated by this Agreement.
3.8 NO UNTRUE STATEMENTS. No representation, warranty
or covenant by Seller in this Agreement contains or will contain any untrue
statement of material fact, or omits or will omit to state a material fact
necessary to make the statements therein not misleading.
<PAGE>
3.9 AGREEMENTS. Except as disclosed or contemplated by
the books or records of the Partnership or as otherwise disclosed to or
known by Buyer or Manager, Seller has not entered into any agreements
relating to the Business Property which are binding on the Partnership or
the Business Property and which will survive the Close of Escrow.
3.10 TITLE TO BUSINESS PROPERTY. Except as disclosed or
contemplated by the books or records of the Partnership or as otherwise
disclosed to or known by Buyer or Manager, Seller has not conveyed any
interest in the Business Property or caused or permitted any liens or
encumbrances to be placed on the Business Property which are not disclosed
by a document or documents recorded in Santa Clara County.
4. REPRESENTATIONS AND WARRANTIES OF BUYER. Buyer
represents and warrants to Seller as follows:
4.1 CORPORATE STANDING. Buyer is duly organized and
validly existing under the laws of the State of California, and has all
requisite power and authority to carry on its business as currently
conducted.
4.2 AUTHORITY. Buyer has the requisite power and
authority to enter into this Agreement and to purchase Seller's Partnership
Interest. Buyer has taken all such action as may be necessary and proper
to authorize this Agreement, its execution and delivery hereof, its
consummation of the transactions contemplated hereby and its execution and
delivery of each of the documents required to be delivered hereunder. This
Agreement has been duly executed and delivered by Buyer and is valid,
binding and enforceable against Buyer in accordance with its terms.
4.3 CONSENTS; CONFLICTS. The execution and delivery of
this Agreement by Buyer and the consummation by Buyer of the transactions
provided hereunder, (i) do not require any third party consent, or notice
to any third party, or any permit, authorization or filing with any
Governmental Body (other than those the failure of which to obtain would
not have a material adverse effect on Seller), (ii) will not violate the
articles of incorporation or bylaws of Buyer, as the same may have been
amended from time to time, and (iii) will not violate, conflict with,
result in the breach of, or cause the acceleration of or default under any
provision of any material agreement, law, order, arbitration award,
judgment or decree to which Buyer is a party or by which Buyer is subject
or bound.
4.4 OMITTED.
4.5 BROKERS OR FINDERS. Neither Buyer, nor any of its
agents, has incurred any obligation or liability, contingent or otherwise,
for brokerage or finders' fees or agents' commissions or other like payment
in connection with this Agreement, and Buyer will indemnify and hold Seller
harmless from any such payment alleged to be due by or through Buyer as a
result of the action of Buyer or its agents.
<PAGE>
5. DELIVERIES TO ESCROW AND CONDUCT BEFORE CLOSING.
5.1 DELIVERIES BY SELLER. Prior to the Scheduled
Closing Date, Seller shall deliver to Escrow Holder each of the following:
5.1.1 An Assignment and Assumption of Partnership
Interest duly executed by Seller in the form attached hereto as EXHIBIT 1
(the "Assignment of Partnership Interest").
5.1.2 Omitted.
5.1.3 An authorization, resolution or written
consent action by the board of directors of JMB in the form attached hereto
as EXHIBIT 3, authorizing this Agreement, the execution and delivery
hereof, the consummation of the transactions contemplated hereby and the
execution and delivery of each of the documents required to be delivered
hereunder (the "JMB Authorizing Resolution").
5.1.4 A Certificate of Non-Foreign Status, duly
executed by Seller in the form attached hereto as EXHIBIT 6 (the
"Certificate of Non-Foreign Status").
5.1.5 Any leases, contracts, books, invoices, bills
or records of the Partnership regarding the ownership, operation or
management of the Business Property from past years in Seller's possession
or control to the extent the same are not in Buyer's possession or control.
5.1.6 Any other documents or instruments which
Buyer or Escrow Holder may reasonably request (provided the same do not
materially increase any cost, liability or obligation of a party from that
otherwise contemplated herein).
5.2 DELIVERIES BY BUYER.
5.2.1On the Scheduled Closing Date, Buyer shall deliver
to Escrow Holder the Purchase Price set forth in Section 2.2.1 above, plus
or minus Buyer's and Seller's respective shares of costs and prorations as
set forth in Section 12.23.
5.2.2Prior to the Scheduled Closing Date, Buyer shall
deliver to Escrow Holder the Assignment of Partnership Interest duly
executed by Buyer.
<PAGE>
5.2.3Prior to the Scheduled Closing Date, Buyer shall
deliver to Escrow Holder an authorization, resolution or written consent
action by the Board of Directors of Buyer (or the Affiliate to which Buyer
is assigning its rights and obligations hereunder) in the form attached
hereto as EXHIBIT 4, authorizing this Agreement, the execution and delivery
hereof, the consummation of the transactions contemplated hereby and the
execution and delivery of each of the documents required to be executed by
Buyer hereunder (the "Buyer Authorizing Resolution").
5.3 COOPERATION AND FURTHER ASSURANCES. Each party to this
Agreement agrees to perform any further acts and execute and deliver any
further documents that may be reasonably necessary to carry out the
provisions and intent of this Agreement (provided the same do not
materially increase any cost, liability or obligation of a party from that
otherwise contemplated herein).
6. CONDITIONS TO CLOSING.
6.1 FOR BUYER. The obligation of Buyer to consummate
the transaction contemplated by this Agreement shall be subject to the
following conditions or Buyer's waiver thereof:
6.1.1 SELLER DELIVERIES. Escrow Holder shall have
received from Seller all of the documents to be delivered by Seller
pursuant to Section 5.1 above.
6.1.2 REPRESENTATIONS, WARRANTIES AND COVENANTS OF
SELLER. Seller shall have duly performed in all material respects each and
every covenant and agreement to be performed by Seller pursuant to this
Agreement and Seller's representations and warranties set forth in
Section 3 above shall be true and correct in all material respects as of
the Scheduled Closing Date.
6.1.3 CONDITION OF THE BUSINESS PROPERTY. As of
the Scheduled Closing Date, there shall have been no Condemnation or damage
or destruction to the Business Property as to which Buyer has elected to
terminate this Agreement in accordance with Section 8 below.
6.2 FOR SELLER. The obligation of Seller to consummate
the transaction contemplated by this Agreement shall be subject to the
following conditions or Seller's waiver thereof:
6.2.1 BUYER DELIVERIES. Escrow Holder shall have
received from Buyer all of the funds and documents to be delivered by Buyer
pursuant to Section 5.2 above.
<PAGE>
6.2.2 REPRESENTATIONS, WARRANTIES AND COVENANTS OF
BUYER. Buyer shall have duly performed in all material respects each and
every covenant and agreement to be performed by Buyer and Buyer's
representations and warranties set forth in Section 4 above shall be true
and correct in all material respects as of the Scheduled Closing Date.
7. CLOSING. The terms "Close of Escrow" and "Closing" are
defined in Section 1.8 above. The following provisions shall govern Escrow
and the Closing:
7.1 SUPPLEMENTAL ESCROW INSTRUCTIONS. The parties
hereby agree to execute, deliver and be bound by any reasonable or
customary supplemental escrow instructions of Escrow Holder in order to
consummate the transaction contemplated by this Agreement. To the extent
of any conflict or inconsistency between such supplemental instructions and
this Agreement, this Agreement shall control.
7.2 CLOSING PROCEDURES. The closing of the purchase
and sale of Seller's Partnership Interest shall take place through Escrow
as described in Section 2.3 above. Immediately upon such Closing, Escrow
Holder shall disburse to Seller the Purchase Price , plus or minus Buyer's
and Seller's respective shares of costs and prorations as set forth in
Section 12.23 below, and shall deliver to Buyer all of the documents, as
originally executed by or on behalf of Seller, deposited into Escrow by
Seller pursuant to Section 5.1 above. Any funds deposited by or on behalf
of Buyer in excess of the above-stated amount shall be returned to Buyer.
8. CONDEMNATION, DAMAGE OR DESTRUCTION.
8.1 CONDEMNATION. In the event of a Condemnation of
all or any portion of the Business Property prior to the Closing, Buyer
may, at its option, elect not to acquire Seller's Partnership Interest, by
written notice to Seller and Escrow Holder within fifteen (15) days after
the date on which such Condemnation commences. If Buyer does so elect,
then the Escrow and this Agreement shall be terminated, and all funds and
documents held by Escrow Holder shall be returned to the party depositing
the same. If Buyer does not so elect, Buyer shall close the purchase, in
which case Buyer shall be entitled to all of the Partnership's interest in
all proceeds relating to such Condemnation.
8.2 DAMAGE OR DESTRUCTION. In the event of damage or
destruction of the Business Property prior to the Closing:
8.2.1 In any case involving Major Damage or
Destruction, Buyer may, at its option, elect not to acquire Seller's
Partnership Interest, by written notice to Seller and Escrow Holder within
fifteen (15) days after the date on which such damage or destruction
occurs. If Buyer does so elect, then the Escrow and this Agreement shall
be terminated, and all funds and documents held by Escrow Holder shall be
returned to the party depositing the same. If Buyer does not so elect,
<PAGE>
Buyer shall close the purchase, in which case Buyer shall be entitled to
all of the Partnership's interest in all insurance proceeds relating to
such damage or destruction.
8.2.2 In any case involving damage or destruction
that is not encompassed by Section 8.2.1 above, Buyer shall close the
purchase, and shall be entitled to all of the Partnership's interest in all
insurance proceeds relating to such damage or destruction.
9. PARTIES' OBLIGATIONS AFTER CLOSING.
9.1 COOPERATION REGARDING TAX RETURNS. Seller and
Buyer shall cooperate, and Buyer shall cause the Partnership to cooperate,
in the closing of their books and the proper reporting of items on the tax
returns of the Partnership. Nothing contained in this Section 9.1 shall be
construed as limiting the responsibility of the Partnership for filing any
and all required tax returns. Seller agrees that the Partnership and each
of the entities constituting Seller will make an Internal Revenue Code
Section 754 election on both of the Partnership's tax returns for the
calendar year in which the Closing occurs.
9.2 EXPENSES OF PARTIES. Except as specifically set
forth in other provisions of this Agreement, all expenses involved in the
preparation, authorization and consummation of this Agreement, and all fees
and expenses for agents, representatives, counsel and accountants, shall be
borne solely by the party who incurs the same. The fees and reimbursable
expenses of Escrow Holder shall be born 50% by Seller and 50% by Buyer.
9.3 INDEMNIFICATION.
9.3.1 Subject to the terms of Section 12.20 below,
Seller covenants and agrees to indemnify, defend and hold Buyer and its
shareholders, officers, directors, employees, agents, attorneys,
representatives, Affiliates, predecessors, successors and assigns
(collectively, the "TrizecHahn Indemnified Group") harmless from and
against any and all actual liabilities obligations, damages, losses and
expenses, including claims of every kind and nature, whether accrued,
absolute, contingent or otherwise, and reasonable attorneys' fees and the
costs of defense (in no event, however, to include any consequential or
punitive damages) (collectively, "Losses"), incurred by any one or more
members of the TrizecHahn Indemnified Group in any action or proceeding
arising as a result or by reason of the breach, falsity or failure of the
representation and warranty made by Seller in Section 3.2 of this Agreement
(the "Specified Representation).
9.3.2 Buyer covenants and agrees to indemnify,
defend and hold Seller and its partners, shareholders, officers, directors,
employees, agents, attorneys, representatives, Affiliates, predecessors,
successors and assigns (collectively, the "JMB Indemnified Group") harmless
from and against any and all Losses (as defined in Section 9.3.1 above)
incurred by any one or more members of the JMB Indemnified Group in any
<PAGE>
action or proceeding arising as a result or by reason of the breach,
falsity or failure of any of Buyer's representations or warranties
contained in this Agreement.
9.4 PROCEDURE FOR INDEMNIFICATION.
9.4.1 If a party shall seek to claim
indemnification pursuant to Section 9.3 above (the "Indemnified Party"),
the Indemnified Party shall promptly notify the party obligated to provide
such indemnification (the "Indemnifying Party") in writing of such claim,
setting forth the nature and amount of the claim in detail. Failure of the
Indemnified Party to promptly notify the Indemnifying Party upon discovery
of an indemnifiable claim shall not bar the Indemnified Party's claim for
indemnification hereunder; provided, however, that the Indemnified Party's
liability hereunder shall be limited to that which would have existed had
prompt notice been given, and the Indemnified Party shall be solely
responsible for, and shall indemnify the Indemnifying Party from such
increased liability that shall have been occasioned by its failure to
provide the Indemnifying Party with prompt notice.
9.4.2 The Indemnifying Party shall promptly notify
the Indemnified Party in writing whether or not it intends to defend such
third party claim or demand. After the assumption of the defense, the
Indemnifying Party shall diligently pursue such defense using counsel
reasonably acceptable to the Indemnified Party. The Indemnified Party
shall not be liable for any legal expenses subsequently incurred by the
Indemnifying Party in connection with such defense, but the Indemnified
Party may participate in such defense at its own expense. However, if the
Indemnifying Party declines or fails or ceases to defend the third party
claim or demand (or if its counsel declares itself barred or disqualified
from acting on behalf of the Indemnified Party in such matter), the
Indemnified Party may assume its own defense through counsel of its own
choice and the Indemnified Party's reasonable legal expenses, including,
without limitation, legal expenses and costs incurred in connection with
collecting any Losses from the Indemnifying Party, shall become part of its
Losses subject to indemnification hereunder.
9.4.3 The Indemnifying Party shall provide, or
cause its counsel to provide, to the Indemnified Party monthly reports as
to the status of any such defense. The Indemnifying Party shall respond
promptly and fully to any inquiries from the Indemnified Party as to any
aspect of the defense of any third party claim or demand.
9.4.4 If a settlement opportunity related to an
indemnified claim or demand of a third party is presented, and if the
Indemnified Party reasonably objects to the settlement offer, the
Indemnifying Party may, at its sole option, pay the amount of settlement
under the settlement offer to the Indemnified Party, in which event the
Indemnifying Party shall be relieved of all liability related to such
indemnified claim or demand and in which event the Indemnified Party shall
conduct and defend at its own cost and through counsel of its own choosing,
the claim or demand of the third party giving rise to such claim for
indemnification.
<PAGE>
9.4.5 Each party shall fully cooperate with the
other party and its counsel in the defense or compromise of such claim or
demand. The Indemnifying Party shall not, except with the written consent
of the Indemnified Party, consent to the entry of a judgment or settlement
which does not include, as a term thereof, the unconditional release of the
Indemnified Party and any of its Affiliates named as parties therein from
all liability in respect of such third party claim or demand.
10. ARBITRATION OF DISPUTES. ANY CONTROVERSY OR CLAIM
ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR CONCERNING THE BREACH OR
INTERPRETATION HEREOF, SHALL BE SETTLED BY ARBITRATION IN ACCORDANCE WITH
THE FOLLOWING PROVISIONS. FOR PURPOSES OF THIS SECTION 10 ONLY, (A) ALL
AFFECTED PARTIES WITHIN THE JMB INDEMNIFIED GROUP WILL BE REFERRED TO IN
THE SINGULAR AS A "PARTY" AND SHALL JOINTLY TAKE THE PROCEDURAL ACTIONS
REQUIRED IN CONNECTION WITH THE ARBITRATION PROCEEDING DESCRIBED BELOW AS
THOUGH THEY WERE A SINGLE "PARTY," AND (B) ALL AFFECTED PARTIES WITHIN THE
TRIZECHAHN INDEMNIFIED GROUP WILL BE REFERRED TO IN THE SINGULAR AS A
"PARTY" AND SHALL JOINTLY TAKE THE PROCEDURAL ACTIONS REQUIRED IN
CONNECTION WITH THE ARBITRATION PROCEEDING DESCRIBED BELOW AS THOUGH THEY
WERE A SINGLE "PARTY." FOR EXAMPLE, IF SELLER, BUYER AND ONE OR MORE OF
THEIR AFFILIATES ARE AFFECTED BY A DEMAND FOR ARBITRATION, THERE WOULD NOT
BE MORE THAN TWO ARBITRATORS SELECTED PURSUANT TO SECTION 10.1 BELOW, BUT
ONLY TWO ARBITRATORS -- ONE NAMED BY THE JMB INDEMNIFIED GROUP, AND THE
OTHER NAMED BY THE TRIZECHAHN INDEMNIFIED GROUP:
10.1 THE PARTY SEEKING ARBITRATION SHALL DELIVER A
WRITTEN NOTICE OF DEMAND TO RESOLVE DISPUTE (THE "DEMAND") TO THE OTHER
PARTY TO THIS AGREEMENT. THE DEMAND SHALL INCLUDE A STATEMENT OF THE
PARTY'S CLAIM, THE AMOUNT THEREOF, AND THE NAME OF THE PROPOSED ARBITRATOR,
SELECTED FROM THE THEN CURRENT COMMERCIAL OR BUSINESS ARBITRATION LIST OF
THE SUPERIOR COURT FOR THE COUNTY OF SANTA CLARA, TO DECIDE THE DISPUTE
("ARBITRATOR"). WITHIN TWENTY (20) DAYS AFTER RECEIPT OF THE DEMAND, THE
OTHER PARTY AGAINST WHOM A DEMAND IS MADE SHALL DELIVER A WRITTEN RESPONSE
("RESPONSE") TO THE DEMANDING PARTY. THE RESPONSE SHALL INCLUDE A SHORT
AND PLAIN STATEMENT OF THE PARTY'S DEFENSES TO THE CLAIM AND SHALL ALSO
STATE WHETHER THE PARTY AGREES TO THE ARBITRATOR CHOSEN BY THE DEMANDING
PARTY.
10.2 IN THE EVENT THE PARTIES CANNOT AGREE ON A SINGLE
ARBITRATOR, EACH PARTY SHALL SELECT AN ARBITRATOR FROM THE THEN CURRENT
COMMERCIAL OR BUSINESS ARBITRATION LIST OF THE SUPERIOR COURT FOR THE
COUNTY OF SANTA CLARA, AND THOSE TWO ARBITRATORS SHALL SELECT A THIRD
ARBITRATOR FROM THE THEN CURRENT COMMERCIAL OR BUSINESS ARBITRATOR LIST OF
THE SUPERIOR COURT OF THE COUNTY OF SANTA CLARA. ANY ARBITRATION SHALL BE
HELD IN A MUTUALLY AGREEABLE LOCATION IN SAN JOSE, CALIFORNIA.
10.3 THE PARTIES SHALL BE ENTITLED TO FULL RIGHTS OF
DISCOVERY AS SET FORTH IN THE CODE OF CIVIL PROCEDURE FOR CIVIL ACTIONS
TRIED IN THE SUPERIOR COURTS OF THE STATE OF CALIFORNIA. ALL DISCOVERY
SHALL BE COMPLETED WITHIN SIXTY (60) DAYS FOLLOWING SELECTION OF THE
ARBITRATORS.
<PAGE>
10.4 THE ARBITRATORS' POWERS SHALL BE LIMITED AS
FOLLOWS: THE ARBITRATORS SHALL FOLLOW THE SUBSTANTIVE LAWS OF THE STATE OF
CALIFORNIA, INCLUDING RULES OF EVIDENCE. HIS/HER/THEIR DECISION SHALL BE
SUPPORTED BY SUBSTANTIAL EVIDENCE AND OTHER LIKE PROVISIONS. THE GROUNDS
FOR CORRECTION, VACATION OR CONFIRMATION SHALL BE LIMITED TO THOSE
CONTAINED IN CODE OF CIVIL PROCEDURE SECTIONS 1286.2 AND 1286.6.
10.5 TO THE EXTENT POSSIBLE, THE ARBITRATION HEARINGS
SHALL BE CONDUCTED ON CONSECUTIVE DAYS, EXCLUDING SATURDAYS, SUNDAYS AND
HOLIDAYS, UNTIL THE COMPLETION OF THE HEARINGS.
10.6 IN CONNECTION WITH ANY ARBITRATION PROCEEDINGS
COMMENCED HEREUNDER, ANY PARTY SHALL HAVE THE RIGHT TO JOIN ANY THIRD
PARTIES IN SUCH PROCEEDINGS IN ORDER TO RESOLVE ANY OTHER DISPUTES, THE
FACTS OF WHICH ARE RELATED TO THE MATTERS SUBMITTED FOR ARBITRATION
HEREUNDER.
10.7 THE ARBITRATORS SHALL RENDER HER/HIS/THEIR DECISION
CONCERNING THE SUBSTANTIVE ISSUE(S) IN DISPUTE IN WRITING. IF THE PARTIES
FAIL TO AGREE ON A SINGLE ARBITRATOR AND THE THREE ARBITRATORS SELECTED
CANNOT AGREE AS TO THEIR DECISION, THEN THE JOINT DECISION OF ANY TWO OF
THE THREE ARBITRATORS SHALL BE CONTROLLING. THE WRITTEN DECISION SHALL BE
SENT TO THE PARTIES NO LATER THAN THIRTY (30) DAYS FOLLOWING THE LAST
HEARING DATE.
10.8 IF ANY OF THE PROVISIONS RELATING TO ARBITRATION
ARE NOT ADHERED TO OR COMPLIED WITH, EITHER PARTY MAY PETITION THE
CALIFORNIA SUPERIOR COURT, SANTA CLARA COUNTY, FOR APPROPRIATE RELIEF.
10.9 IN THE EVENT THE PARTIES PROCEED WITH ARBITRATION,
EACH PARTY AGREES TO USE ITS BEST EFFORTS TO HAVE THE JUDGMENT OR
DETERMINATION OF THE ARBITRATORS RENDERED WITHIN NINETY (90) DAYS OF THE
DATE OF DELIVERY OF THE REQUEST THAT SUCH ARBITRATION BE COMMENCED. THE
PARTIES AGREE TO BE BOUND BY THE RULES OF THE AMERICAN ARBITRATION
ASSOCIATION.
10.10NOTICE: BY INITIALING IN THE SPACE BELOW YOU ARE
AGREEING TO HAVE ANY DISPUTE ARISING OUT OF THE MATTERS INCLUDED IN THIS
"ARBITRATION OF DISPUTES" PROVISION DECIDED BY NEUTRAL ARBITRATION AS
PROVIDED BY CALIFORNIA LAW AND YOU ARE GIVING UP ANY RIGHTS YOU MIGHT
POSSESS TO HAVE THE DISPUTE LITIGATED IN A COURT OR JURY TRIAL. BY
INITIALING IN THE SPACE BELOW YOU ARE GIVING UP YOUR JUDICIAL RIGHTS TO
DISCOVERY AND APPEAL, UNLESS THOSE RIGHTS ARE SPECIFICALLY INCLUDED IN THE
"ARBITRATION OF DISPUTES" PROVISION. IF YOU REFUSE TO SUBMIT TO
ARBITRATION AFTER AGREEING TO THIS PROVISION, YOU MAY BE COMPELLED TO
ARBITRATE UNDER THE AUTHORITY OF THE CALIFORNIA CODE OF CIVIL PROCEDURE.
YOUR AGREEMENT TO THIS ARBITRATION PROVISION IS VOLUNTARY.
10.11WE HAVE READ AND UNDERSTAND THE FOREGOING AND AGREE
TO SUBMIT DISPUTES ARISING OUT OF THE MATTERS INCLUDED IN THE "ARBITRATION
OF DISPUTES" PROVISION TO NEUTRAL ARBITRATION.
<PAGE>
_____/_____ _____/_____
SELLER'S BUYER'S
INITIALS INITIALS
11. MUTUAL RELEASES.
11.1 TRIZECHAHN RELEASE. Effective upon the Close of
Escrow, Buyer, for itself and its shareholders, officers, directors,
employees, agents, attorneys, representatives, Affiliates, predecessors,
successors and assigns (collectively, the "TrizecHahn Release Group"),
fully and forever release and discharge Seller, and its shareholders,
partners, officers, directors, employees, agents, attorneys,
representatives, Affiliates, predecessors, successors and assigns
(collectively, the "JMB Release Group"), of and from any and all claims,
debts, demands, actions, and causes of actions, suits, costs, damages,
expenses, accounts, covenants, contracts, controversies, agreements,
promises and liabilities whatsoever, both in law and in equity, which they
may now have or ever may have had or may have in the future against the JMB
Release Group, and each of them, for all matters relating to, or arising
from (i) the Partnership, the Partnership Agreement, the Management
Agreement, the Partnership Interest or the Partnership Property (ii) the
ownership, management and operation of the Business Property and
Partnership Property at any time whatsoever, whether before, during or
after the Close of Escrow, (iii) the conduct of the JMB Release Group, and
each of them at any time whatsoever, whether before, during or after the
Close of Escrow, with respect to the Partnership Agreement, the Management
Agreement, the Partnership Interest or the Partnership Property, and (iv)
any breach or alleged breach of this Agreement; BUT SPECIFICALLY EXCLUDING
from the foregoing release and discharge only (a) claims based upon the
representations, warranties, indemnities and further assurances
specifically set forth in Sections 3, 5.3 and 9.3 of this Agreement, which
by the terms of Section 12.20 below are to survive the execution and
delivery hereof, the consummation of the transactions contemplated hereby
and the transfer and delivery of Seller's Partnership Interest, (b) claims
by Buyer referred to in Sections 12.20.1 and 12.20.2 below, and (c) the
obligations of Seller under Sections 12.23 and 12.24 below.
11.2 JMB RELEASE. Effective upon the Close of Escrow,
Seller, for itself and for the JMB Release Group, and each of them, fully
and forever release and discharge the TrizecHahn Release Group, and each of
them, of and from any and all claims, debts, demands, actions, and causes
of actions, suits, costs, damages, expenses, accounts, covenants,
contracts, controversies, agreements, promises and liabilities whatsoever,
both in law and in equity, which they may now have or ever may have had or
may have in the future against the TrizecHahn Release Group, and each of
them, for all matters relating to, or arising from (i) the Partnership, the
Partnership Agreement or the Management Agreement, the Partnership
Interest, or the Partnership Property (ii) the ownership, management and
operation of the Business Property and Partnership Property at any time
whatsoever, whether before, during or after the Close of Escrow, (iii) the
conduct of the TrizecHahn Release Group, and each of them at any time
whatsoever, whether before, during or after the Close of Escrow, with
respect to the Partnership Agreement, the Management Agreement, the
Partnership Interest or the Partnership Property, and (iv) any breach or
alleged breach of this Agreement; BUT SPECIFICALLY EXCLUDING from the
foregoing release and discharge only (a) those certain claims that are
based upon the representations, warranties, indemnities and further
assurances specifically set forth in Sections 4, 5.3 and 9.3 of this
Agreement, which by the terms of Section 12.20 below are to survive the
<PAGE>
execution and delivery hereof, the consummation of the transactions
contemplated hereby and the transfer and delivery of Seller's Partnership
Interest, and (b) the obligations of Buyer under Sections 12.23 and 12.24
below.
11.3 CIVIL CODE SECTION 1542. All rights under Section
1542 of the Civil Code of the State of California, and under any and all
similar laws of any State, are hereby expressly waived. Each party is
aware that Section 1542 of the Civil Code provides as follows:
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR
DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE
RELEASE, WHICH IF KNOWN BY HIM, MUST HAVE MATERIALLY AFFECTED HIS
SETTLEMENT WITH THE DEBTOR.
12. MISCELLANEOUS PROVISIONS.
12.1 NOTICE AND CURE RIGHTS.
12.1.1 If either party (the "Defaulting
Party") defaults under any term, condition or provision of this Agreement,
then the other party (the "Non-Defaulting Party"), after delivery of ten
(10) days' written notice to the Defaulting Party specifically describing
the default (the "Default Notice"), and after the Defaulting Party's
failure to cure such default within the ten (10) day period (the "Cure
Period"), (i) may declare an event of default ("Event of Default"), and,
(ii) subject to Sections 12.1.2, 12.2, 12.10 and 12.20 below, may pursue
its remedies as set forth in this Agreement; provided, however, in no event
shall Seller be obligated to extend the Scheduled Closing Date to
accommodate any cure hereunder or under Section 12.1.2 below.
12.1.2 If Buyer is the party to whom such a
Default Notice is given, then Seller shall NOT be entitled to terminate
this Agreement or the escrow (and any previous notice from Seller
purporting to exercise that right shall be deemed to be stayed), and Seller
shall be obligated to close the escrow on Buyer's purchase of Seller's
Partnership Interest, notwithstanding such Event of Default, unless each of
the following conditions are met:
(a) The Event of Default declared by Seller is
material;
(b) Buyer either (i) failed to commence to cure
the default described in the Default Notice within the Cure Period, or
(ii) with respect to a default which cannot be cured within the Cure
Period, Buyer commenced to cure the default within the Cure Period, but
thereafter failed to prosecute such cure diligently toward completion
throughout the period from such commencement to the Close of Escrow; and
<PAGE>
(c) The Close of Escrow does not occur on or
prior to the Scheduled Closing Date.
12.2 REFRAINING FROM LEGAL PROCEEDINGS. Each party agrees
that, during the term of this Agreement, it shall not (i) commence, join
in, prosecute or participate in any suit, arbitration or other proceeding
in a position which is adverse to any other parties arising directly or
indirectly from the transactions contemplated by this Agreement or in any
way relating to the Business Property, the Partnership Agreement or its
management, or (ii) terminate, or attempt to terminate, this Agreement,
without in each instance first giving to the other parties the Default
Notice and opportunity to cure described in Section 12.1 above.
12.3 ASSIGNMENT. No party may assign its rights or
obligations under this Purchase Agreement without receipt of the other
parties' prior written consent; provided, however that Buyer may assign its
rights and obligations hereunder to any Affiliate of Buyer, without the
consent of Seller.
12.4 AMENDMENT, MODIFICATION AND WAIVER. No amendment,
modification or waiver of this Purchase Agreement or any part hereof shall
be valid or effective unless in writing and signed by the party sought to
be charged therewith. No waiver of any breach or condition of this
Purchase Agreement shall be deemed to be a waiver of any other or
subsequent breach or condition, whether of like or different nature. No
course of dealing between the parties hereto will be deemed effective to
amend, modify or discharge any part of this Purchase Agreement or the
rights or obligations of any party hereunder.
12.5 PARTIAL INVALIDITY. If any provision of this Purchase
Agreement shall be held by competent authority to be invalid or
unenforceable, such provision shall be construed so as to be limited or
reduced to be enforceable to the maximum extent compatible with the law as
it shall then appear. The total invalidity or unenforceability of any
particular provision of this Purchase Agreement shall not affect the other
provisions hereof, and this Purchase Agreement shall be construed in all
respects as if such invalid or unenforceable provision were omitted.
12.6 NO THIRD PARTY BENEFICIARY. Except as expressly provided
in Sections 9.3 and 9.4 above (related to indemnification) and in Section
11 above (entitled Mutual Releases), no person or entity shall be deemed to
be a third party beneficiary hereof, and nothing in this Purchase Agreement
(either expressed or implied) is intended to confer upon any other person
or entity any rights, remedies, obligations or liabilities under or by
reason of this Purchase Agreement.
12.7 NOTICES. Any notice or other communication required or
permitted under this Purchase Agreement shall be in writing and shall be
deemed to have been duly given (i) upon personal delivery, (ii) on the
third day after the date of mailing by United States registered or
certified mail, postage prepaid, return receipt requested, (iii) on the
first day following delivery to a nationally recognized United States
overnight courier service, fee prepaid, return receipt or other
confirmation of delivery requested, or (iv) upon confirmation of receipt by
<PAGE>
fax. Any such notice or communication shall be addressed as set forth
below, or to such other address as may be designated by a party in a notice
given to all other parties in accordance with the provisions of this
Section 12.
Address for Notices to Seller:
JMB Realty Corporation
900 North Michigan Avenue
Chicago, Illinois 60611-1575
Attn: Mr. Glenn Emig
Telephone: (312) 915-2350
Facsimile: (312) 915-2310
With a Copy to:
Pircher, Nichols & Meeks
1999 Avenue of the Stars, 26th Floor
Los Angeles, California 90067
Attention: Gary M. Laughlin
Telephone: (310) 201-8907
Facsimile: (310) 201-8922
Address for Notices to Buyer:
TrizecHahn Centers Inc.
4350 La Jolla Village Drive, Suite 400
San Diego, California 92122-1233
Attn: Ms. Mary Allman Boyle
Telephone: (619) 546-3490
Facsimile: (619) 546-3396
<PAGE>
With a Copy to:
Allen, Matkins, Leck, Gamble & Mallory LLP
501 West Broadway, 9th Floor
San Diego, California 92101
Attn: Steven C. Wellington, Esq.
Telephone: (619) 233-1509
Facsimile: (619) 233-1158
Address for Notices to Escrow Holder:
First American Title Guaranty Company
114 East Fifth Street
Santa Ana, California 92701
Attn: Mickey Elkington
Telephone: (800) 854-3643 ext. 6130
Facsimile: (714) 647-2139
Escrow No.: N984072E
12.8 TIME OF ESSENCE. Time is of the essence to this
Purchase Agreement.
12.9 GOVERNING LAW. This Purchase Agreement shall be
governed, construed and enforced in accordance with the laws of the State
of California.
12.10 REMEDIES. Except as otherwise expressly
provided herein, no remedy conferred upon a party by this Agreement is
intended to be exclusive of any other remedy herein or by law provided or
permitted, but each shall be cumulative and shall be in addition to every
other remedy given hereunder or now or hereafter existing at law, in equity
or by statute; provided, however, that if the transaction hereunder shall
fail to close and Seller shall be in default hereunder, then (i) Buyer
shall be entitled only to specifically enforce this Agreement, and to such
ancillary damages as may awarded in connection with such an action for
specific enforcement, but if specific enforcement is determined in the
legal proceeding to be impossible to effect by reason of Seller's default,
then Buyer shall be entitled to such alternative remedies (in no event,
however, to include any consequential or punitive damages) as may be found
in the legal proceeding to be appropriate, and (ii) no other actions for
damages (including, without limitation, actions for consequential or
punitive damages) shall be permitted as a result of such default by Seller.
<PAGE>
12.11 ATTORNEYS' FEES. In the event of any
controversy, claim or dispute between the parties arising from or related
to this Purchase Agreement or the breach hereof, the prevailing party shall
be entitled to recover from the losing party its reasonable costs, expenses
and attorneys' fees.
12.12 EXPENSES OF PARTIES. Except as specifically
set forth in other provisions of this Purchase Agreement, all expenses
involved in the preparation, authorization and consummation of this
Purchase Agreement, including, without limitation, all fees and expenses
for agents, representatives, counsel and accountants, shall be borne solely
by the party who incurs the same, and the other party shall have no
liability with respect thereto.
12.13 FURTHER ASSURANCES. The parties agree to
take such further actions and to execute such additional documents and
instruments as may be reasonably required in order to more effectively
carry out the terms of this Purchase Agreement and the intentions of the
parties.
12.14 HEADINGS. The headings contained in this
Purchase Agreement are inserted for convenience only and do not constitute
a part of this Purchase Agreement.
12.15 GENDER. Whenever the context may require,
any pronoun used herein shall include the corresponding masculine, feminine
or neuter forms, and the singular of nouns, pronouns and verbs shall
include the plural and vice versa.
12.16 FAIR MEANING. This Purchase Agreement shall
be construed according to its fair meaning, the language used shall be
deemed the language chosen by the parties hereto to express their mutual
intent, and no presumption or rule of strict construction will be applied
against any party hereto.
12.17 BINDING EFFECT. This Purchase Agreement
shall be binding upon and inure to the benefit of the parties hereto and
their respective permitted successors and permitted assigns.
12.18 COUNTERPARTS AND FACSIMILES. This Purchase
Agreement may be executed in multiple copies, each of which will be deemed
an original, but all of which will constitute one Purchase Agreement after
each party has signed such a counterpart. An executed counterpart may be
delivered by transmission of a facsimile copy, promptly followed by
delivery of the original in accordance with this Purchase Agreement, and in
such a case, delivery shall be deemed effective upon transmission of the
facsimile copy.
<PAGE>
12.19 ENTIRE AGREEMENT. This document contains the
entire agreement between the parties related to the purchase and sale of
Seller's Partnership Interest and supersedes any prior understandings,
memoranda and other written or oral agreements between or among any of them
respecting the subject matter hereof. There are no representations,
agreements, arrangements or understandings, oral or written, between or
among any of the parties relating to the subject matter of this Purchase
Agreement which are not fully expressed herein.
12.20 LIMITATION ON LIABILITY; SURVIVAL OF CLAIMS.
12.20.1 If, PRIOR TO the Close of Escrow, Buyer
gives written notice to Seller stating that Buyer has become aware of a
breach or default by Seller with respect to the Specified Representation,
and such notice is later determined to have been substantially correct,
then Buyer shall be entitled to all remedies against Seller permitted by
this Agreement, without being subject to the limitations set forth in the
remainder of Sections 12.20.1, 12.20.2 or 12.20.3. The intent of the
parties is that, as to that particular matter, if it becomes known to and
is asserted in writing by Buyer PRIOR TO the Close of Escrow, Buyer should
not be deprived of the full benefit of its bargain pursuant to this
Agreement.
12.20.2 In contrast, in connection with all
claims asserting a breach or default by Seller under this Agreement or any
other document executed or delivered in connection herewith OTHER THAN
claims covered by Section 12.20.1 above, whether Buyer (i) first gives
written notice asserting such other claims PRIOR TO the Close of Escrow (as
to a matter not covered by Section 12.20.1 above) or (ii) first gives
notice ON OR AFTER the Close of Escrow, including, without limitation, all
claims based upon representations, warranties, indemnities and further
assurances under this Agreement or any other document executed or delivered
in connection herewith which survive the Close of Escrow and as to which
Buyer's claim of breach or default is first given ON OR AFTER the Close of
Escrow (collectively, the "Capped Claims"), the following limitations shall
apply:
(a) Notwithstanding anything to the contrary
contained herein (and without limitation on any of the other limitations on
liability or remedies contained in this Agreement), the aggregate liability
of Seller arising with respect to (i) Capped Claims other than the
Specified Representation shall not exceed $1,000,000, and (ii) all Capped
Claims (including the Specified Representation) shall not exceed the
Purchase Price.
(b) The Capped Claims (including the Specified
Representation) shall survive the consummation of the transactions
contemplated thereby and the transfer and delivery of Seller's Partnership
Interest pursuant to this Agreement for a period (the "Survival Period")
lasting only until December 1, 1998, at which time they shall terminate,
except as to claims asserted by Buyer to Seller in writing on or before
December 1, 1998 and on which arbitration or litigation is commenced by
December 31, 1998 (if not resolved by then). The claims described in the
exception clause in the preceding sentence shall survive until finally
resolved.
<PAGE>
12.20.3 The provisions of this Section 12.20.3
shall be of no concern to the Escrow Holder.
(a) Seller shall retain reserves of at least
$1,000,000 at the time of closing under this Agreement, and, until the
expiration of the Survival Period, Seller shall not distribute the same to
its partners, but shall only utilize such retained funds for the payment of
the Capped Claims or for the payment of attorneys' fees of Seller
(including any amounts incurred in connection with resolving or defending
any claim of liability for the Capped Claims).
(b) Notwithstanding the foregoing, (i) if Seller
or a liquidating trust or other similar successor-in-interest established
by Seller shall fail to retain such reserves of at least $1,000,000 at the
time of closing, or (ii) if during the Survival Period, Seller (or such
successor-in-interest as aforesaid) shall utilize such reserves for any
purpose other than the payment of the Capped Claims or attorneys' fees
(including amounts for resolving or defending claims as aforesaid), or
(iii) if for any other reason (including, without limitation, the payment
of attorneys' fees or amounts for resolving or defending claims as
aforesaid), all of Buyer's claims against Seller for the Capped Claims are
finally resolved and the aggregate amount to which Buyer is entitled
pursuant to such final resolution (not to exceed $1,000,000 in the
aggregate except with respect to the Specified Representation)
(collectively, the "Final Award in Favor of Buyer") exceeds the aggregate
amount actually paid by Seller (or such successor-in-interest as aforesaid)
to Buyer from its (or their) reserves in satisfaction of the Final Award in
Favor of Buyer, then in any such case, Buyer may look to the assets of JMB,
as the general partner of Seller, for the payment of the Final Award in
Favor of Buyer; provided, however, that (except as provided in subparagraph
(c) below) the aggregate liability of JMB in connection therewith shall not
exceed the lesser of:
-- $1,000,000; or
-- The difference between (x) the Final Award in
Favor of Buyer, and (y) the amount actually paid by Seller (or such
successor-in-interest as aforesaid) to Buyer from its (or their) reserves
in satisfaction of the Final Award in Favor of Buyer.
For example, if Seller properly retains a reserve of $1,000,000 at the time
of Closing, Seller properly expends $200,000 from that reserve for its own
attorneys' fees in resolving or defending a claim against its reserves, a
Final Award in favor of Buyer in the amount of $1,000,000 is nevertheless
entered against Seller, and Seller actually pays to Buyer the entire
$800,000 then remaining in Seller's reserve, then Buyer may recover from
JMB the remaining $200,000 that is unpaid and owed on the Final Award in
favor of Buyer.
(c) Notwithstanding anything contained in
subparagraphs (a) and (b) above, with respect to the Specified
Representation, Buyer may look to the assets of JMB for the payment of the
Final Award in favor of Buyer to the extent not paid by Seller (or such
successor-in-interest as aforesaid) to Buyer from its (or their) reserves;
<PAGE>
provided, however, that the aggregate liability of JMB in connection with
the Capped Claims (including the Specified Representation) shall in no
event exceed the Purchase Price.
12.20.4 No constituent partner in or agent of
Seller, nor any advisor, trustee, director, officer, employee, beneficiary,
shareholder, participant, representative or agent of any corporation or
trust that is or becomes a constituent partner in Seller (including, but
not limited to, JMB, except for the limited extent to which Buyer may look
to the assets of JMB pursuant to Sections 12.20.1 and 12.20.3 above) shall
have any personal liability, directly or indirectly, under or in connection
with this Agreement or any agreement made or entered into pursuant hereto,
or any amendment or amendments to any of the foregoing made at any time or
times, heretofore or hereafter, and Buyer and its successors and assigns
and, without limitation, all other persons and entities, shall look solely
to the reserves referred to in Section 12.20.3 above, to offsets against
any undelivered portion of the Purchase Price and to Seller's other assets
for the payment of any claim or for any performance, and Buyer, on behalf
of itself and its successors and assigns, hereby waives any and all such
personal liability. Notwithstanding anything to the contrary contained in
this Agreement, neither the negative capital account of any constituent
partner in Seller (or in any other constituent partner of Seller), nor any
obligation of any constituent partner in Seller (or in any other
constituent partner of Seller) to restore a negative capital account or to
contribute capital to Seller (or to any other constituent partner of
Seller), shall at any time be deemed to be the property or an asset of
Seller or any such other constituent partner (and neither Buyer nor any of
its successors or assigns shall have any right to collect, enforce or
proceed against or with respect to any such negative capital account or
partner's obligation to restore or contribute).
12.21 TAX STRUCTURE OF PURCHASE. Provided that Seller incurs
no cost regarding same and that the Close of Escrow is not delayed thereby,
Seller agrees to cooperate with Buyer in structuring the transaction
contemplated by this Agreement in a tax efficient manner. Seller agrees
that, without limitation, the transaction may be structured as a transfer
of the Partnership Property from the Partnership to the partners and a
subsequent sale of Seller's undivided interest in the Partnership Property
to Buyer.
12.22 CONFIDENTIALITY. Except as required by law, until the
Close of Escrow occurs, neither Buyer nor Seller shall issue or cause the
publication of any press release or other public announcement with respect
to the transaction contemplated by this Agreement without the consent of
the other party, which consent shall not be unreasonably withheld.
12.23 COSTS AND EXPENSES; PRORATIONS.
12.23.1 COSTS AND EXPENSES OF SALE. Buyer will pay
50% of all fees due to Richard Ellis up to a maximum aggregate fee of
$575,000 (i.e., Buyer will pay a maximum of $287,500). Seller will pay the
remainder of all fees due to Richard Ellis. Seller and Buyer agree to use
good faith efforts to negotiate with Richard Ellis a reduction of such
fees. Seller and Buyer will each pay one-half of all transfer taxes due in
connection with this transaction and Escrow Holder's fees and costs. If,
as a result of no fault of Buyer or Seller, the Close of Escrow fails to
occur, the parties shall share equally all of the fees and charges
<PAGE>
pertaining to the Escrow. If the Close of Escrow fails to occur as a
result of a party's default hereunder, the defaulting party will be
responsible for all fees and charges pertaining to the Escrow. Seller
hereby acknowledges that it is solely responsible for the payment of all
costs associated with previous efforts by Seller to market or sell Seller's
Partnership Interest and/or the Partnership Property.
12.23.2 TENANT IMPROVEMENT ALLOWANCES. Seller
acknowledges that the Partnership is obligated to fund certain leasing
commissions and tenant improvement allowances with respect to tenant leases
which have been approved as of the date hereof. An amount equal to 50% of
such leasing commissions and tenant improvement allowances which have not
yet been funded by the Partnership as of the Close of Escrow is being
credited to Buyer at the Close of Escrow. Said credit is reflected in the
Prorations Credit referenced in Section 12.23.3 below.
12.23.3 PARTNERSHIP INCOME AND EXPENSES. By mutual
agreement, the parties have heretofore prorated the income and expenses of
the Partnership based on good faith estimate of the portion of said income
and expenses accruing prior to the Close of Escrow. As a result of that
proration, Buyer/Seller will receive a One Hundred Six Thousand Six Hundred
Seventy Eight Dollars ($106,678) credit (the "Prorations Credit") at the
Close of Escrow, said Prorations Credit to be reflected in the prorations
statement to be delivered to Escrow Holder pursuant to Section 12.23.5
below. Buyer and Seller hereby agree that the Prorations Credit represents
the final, definitive reconciliation between Buyer and Seller with respect
to the items of income and expenses of the Partnership which were covered
by the proration and that, except as specifically set forth in Section
12.24 below, neither Buyer nor Seller shall have any further liability or
obligation to the other with respect to said income and expenses.
Notwithstanding the foregoing, the parties agree that the Prorations Credit
will be adjusted at the Close of Escrow so that Buyer receives a credit to
the Prorations Credit in an amount equal to the product of Four Thousand
Seven Hundred Two Dollars ($4,702) times the number of days from April 1,
1998 to the Close of Escrow (with each day AFTER, but not including, April
1, 1998, counting as one day).
12.23.4 DISTRIBUTION OF CASH. Upon the Close of
Escrow, the Cash Reserve will be established pursuant to Section 12.24
below. In connection therewith, Seller shall receive a credit equal to
Seller's share of the amount by which all cash belonging to the Partnership
as of the April 1, 1998Close of Escrow exceeds the Cash Reserve, in the
amount of Three Hundred Ninety Two Thousand One Hundred and Fifty Dollars
($392,150).
12.23.5 PRORATIONS STATEMENT. Seller and Buyer shall
mutually prepare and deliver to Escrow Holder, no later than two (2) days
prior to the Scheduled Closing Date, a schedule setting forth the amounts
to be debited and credited to Seller and Buyer pursuant to
Sections 12.23.1, 12.23.3 and 12.23.4 above.
12.24 CASH RESERVE. Upon the Close of Escrow, a cash reserve
in the amount of Two Hundred Fifty Thousand dollars ($250,000) ("the Cash
Reserve") shall be established from the cash belonging to the Partnership
as of the Closing Date. The Cash Reserve may be used solely for the
following purposes: (i) payment of any and all hard and soft costs
<PAGE>
actually incurred by the Partnership in making repairs and/or replacements
to the roofs of the existing bowling alley and/or free standing bank
buildings (collectively, "Roof Repairs"), (ii) any reasonable legal costs
incurred by the Partnership in pursuing the Partnership's rights and
remedies against the applicable tenants relating to the Roof Repairs, (iii)
the payment of any additional rent under the ground lease of the Business
Property for any period prior to the Close of Escrow resulting from the
settlement or other disposition of the existing dispute with the ground
lessor concerning the proper calculation of participating rent thereunder
and any reasonable third party costs or expenses incurred by the
Partnership in resolving said dispute, and (iv) expenses of the Partnership
accruing prior to the Close of Escrow but not accounted for via the
proration described in Section 12.23.3 above (said expenses not to exceed
twentyFiftyfi tThousand dDollars ($2550,000)) and (v) any reasonable third
party costs or expenses incurred by the Partnership as a result of exercise
by the holder of the Easement of its rights under the Easement (said costs
and expenses not to exceed __________________________ dollars
($_________)). To the extent the Cash Reserve is used for the making of
Roof Repairs and/or for the legal costs of pursuing the Partnership's
rights against tenants relating to the Roof Repairs, any amounts relating
thereto subsequently recovered by the Partnership from said tenants will be
distributed one-half to Seller and one-half to Buyer. As used in this
Section 12.24, the term "Easement" means the easement dated December 8,
1977 from William J. Mabie and Inez E. Mabie to Pacific Gas & Electric
Company, which easement was recorded December 23, 1997 in book D363, page
172. On December 1, 1998, any amount remaining in the Cash Reserve shall
be distributed one-half to Seller and one-half to Buyer.
12.25 WAIVER OF RIGHT OF FIRST REFUSAL. Provided that the
Close of Escrow fails to occur and that such failure is not due to a
default by Seller hereunder, Buyer hereby agrees, on its own behalf and on
behalf of its Affiliates, for a period of six (6) months following the
Scheduled Closing Date, to waive its and its Affiliates' rights of first
refusal or other similar rights to acquire the Partnership Property under
the Partnership Agreement with respect to any offer received by Seller from
a third party to purchase the Partnership Property for a gross purchase
price of at least $63,000,000.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have duly executed this
Purchase Agreement as of the date first set forth above.
SELLER: CARLYLE REAL ESTATE LIMITED PARTNERSHIP-VII,
an Illinois limited partnership
By: JMB REALTY CORPORATION,
a Delaware corporation,
General Partner
By:
Name: ______________________
Title: _____________________
By:
Name: ______________________
Title: _____________________
BUYER: TRIZECHAHN CENTERS INC.,
a California corporation
By:
Name: ____________________________
Title: ___________________________
By:
Name: ____________________________
Title: ___________________________
<PAGE>
CONSENT OF ESCROW HOLDER
First American Title Insurance Company, the Escrow Holder
under this Agreement, hereby consents to the opening of Escrow pursuant to
the terms of this Agreement.
Date: _______________, 19___ First American title Insurance Company
By:
Name: __________________________
Title: _________________________
<PAGE>
EXHIBIT 1
THIS ASSIGNMENT AND ASSUMPTION OF PARTNERSHIP INTEREST ("Assignment") is
made effective as of ____________, 19__, by and between CARLYLE REAL ESTATE
LIMITED PARTNERSHIP-VII, an Illinois limited partnership ("Assignor") and
TRIZECHAHN CENTERS INC., a California corporation ("Assignee") with
reference to the following matters:
A. PARTNERSHIP. Assignor and Assignee are general partners
in Oakridge Associates, a California general partnership (the
"Partnership").
B. PURCHASE AGREEMENT. Assignor and Assignee entered into
that certain Oakridge Agreement for Purchase and Sale of Partnership
Interest (the "Purchase Agreement") on March __, 1998 (the "Effective
Date"), regarding the purchase and sale of all of Assignor's interest in
the Partnership, including, without limitation, all of its interest in
capital, profits, liquidation proceeds, distributions and all other rights
and interests under the Partnership Agreement or relating to the
Partnership (collectively, the "Partnership Interest").
C. PURPOSE. Pursuant to the Purchase Agreement, Assignor
desires to assign its Partnership Interest to Assignee, and Assignee
desires to accept such assignment and assume all obligations and
responsibilities of Assignor with respect to its Partnership Interest, as
hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. ASSIGNMENT. Assignor hereby assigns, conveys, transfers
and delivers all of the Partnership Interest to Assignee.
2. ACCEPTANCE OF ASSIGNMENT AND ASSUMPTION.
2.1 Assignee hereby accepts the foregoing assignment of
the Partnership Interest, and assumes all liabilities associated with the
Partnership Interest arising after the date of this Assignment (excepting
only such matters, if any, as may be expressly provided in the Purchase
Agreement).
2.2 Assignee acknowledges having read and understood
the Partnership's Articles of Partnership made and entered into as of
October 15, 1977 (the "Partnership Agreement"), and hereby agrees to be
bound by each and every term thereof.
<PAGE>
3. GENERAL PROVISIONS.
3.1 NECESSARY ACTS. Each party agrees to perform any
further acts, and to execute and deliver any further documents, that may be
reasonably necessary or appropriate to carry out this Assignment.
3.2 AMENDMENT. Any oral representations or
modifications concerning this Assignment shall be of no force or effect.
This Assignment may be amended only in a writing, signed by the party to be
charged.
3.3 CAPTIONS. Paragraph headings or captions are
inserted as a matter of convenience and reference, and in no way define,
limit, extend or describe the scope of this Assignment or any provision
hereof.
3.4 GOVERNING LAW. This Assignment shall be governed
by the laws of the State of California.
3.5 COUNTERPARTS AND FACSIMILES. This Assignment may
be executed in multiple copies, each of which will be deemed an original,
but all of which will constitute one Assignment after each party has signed
such a counterpart. An executed counterpart may be delivered by
transmission of a facsimile copy, promptly followed by delivery of the
original in accordance with this Agreement, and in such a case, delivery
shall be deemed effective upon transmission of the facsimile copy.
3.6 SUCCESSORS AND ASSIGNS. This instrument shall bind
and inure to the benefit of the respective heirs, personal representatives,
grantees, successors and assigns of the parties hereto.
3.7 INCORPORATION BY REFERENCE. The covenants,
agreements and limitations (including, but not limited to, the limitations
of liability provided in Section 12.20 of the Purchase Agreement) provided
in the Purchase Agreement with respect to the Partnership Interest are
incorporated herein by this reference as if set out in full herein.
<PAGE>
IN WITNESS WHEREOF, Assignor and Assignee have caused this
Assignment to be executed effective as of __________, 1998.
ASSIGNOR: CARLYLE REAL ESTATE LIMITED PARTNERSHIP-VII,
AN ILLINOIS LIMITED PARTNERSHIP
BY: JMB REALTY CORPORATION,
A DELAWARE CORPORATION,
GENERAL PARTNER
By:
Name: ______________________
Title: _____________________
By:
Name: ______________________
Title: _____________________
ASSIGNEE: TRIZECHAHN CENTERS INC.,
a California corporation
By:
Name: ______________________
Title: _____________________
By:
Name: ______________________
Title: _____________________
<PAGE>
EXHIBIT 3
JMB AUTHORIZING RESOLUTION
The undersigned, ____________________________________________,
Secretary to JMB REALTY CORPORATION, a Delaware corporation (the
"Corporation"), hereby certifies as follows:
1. The undersigned is the duly elected, qualified and acting
Secretary of the Corporation, and as such has custody and control of the
records and seal of the Corporation.
2. The undersigned has full power and authority to execute
and deliver this Certificate.
3. The Corporation is the sole General Partner of CARLYLE
REAL ESTATE LIMITED PARTNERSHIP-VII, an Illinois limited partnership
("Carlyle"). Carlyle is a general partner in OAKRIDGE ASSOCIATES, a
California general partnership (the "Partnership").
4. The following Resolutions are a true, complete and
correct copy of the Resolutions duly authorized and adopted by the Board of
Directors of the Corporation on or before the date hereof, are now in full
force and effect and have not been amended or revoked:
RESOLVED, that the Corporation hereby approves of the
sale by Carlyle of all its partnership interests in the Partnership , to
TRIZECHAHN CENTERS, INC., a California corporation ("Buyer"), for the price
and on the other terms and conditions substantially as set forth in that
certain Oakridge Agreement for Purchase and Sale of Partnership Interest
(the "Purchase Agreement") on March __, 1998 (the "Effective Date"), by and
between Carlyle and Buyer. The consummation of all transactions
contemplated in the Purchase Agreement, and the execution and delivery of
each of the documents required to be delivered thereunder, are hereby
approved.
RESOLVED FURTHER, that either (a) _____________________,
as __________________ of the Corporation, acting alone, or
(b) ___________________________________________________, as
__________________ of the Corporation, acting alone, or (c) any two
officers of the Corporation, acting together, are each authorized,
empowered and directed to take further action and to execute, make oath to,
acknowledge and deliver, from time to time in the name and on behalf of the
Corporation, and the Corporation is authorized, empowered and directed to
take further action and to execute, make oath to, acknowledge and deliver,
from time to time in the name and on behalf of Carlyle, such other
agreements, instruments, certificates or documents and to do or to cause to
be done any and all such other acts and things as such officer or officers
may deem necessary, proper, appropriate or advisable to consummate the
<PAGE>
transactions contemplated by the Purchase Agreement and to carry out the
intent of the forgoing resolutions, the taking of such actions to be
conclusive evidence that the same have been authorized and approved by the
Board of Directors of the Corporation and by Carlyle.
RESOLVED FURTHER, that, by these Resolutions, all such actions
as may be necessary pursuant to the partnership agreement of Carlyle have
now been taken, to authorize Carlyle's execution and delivery of the
Purchase Agreement, consummation of the transactions contemplated thereby
and execution and delivery of each of the documents required to be
delivered thereunder, and Buyer may rely thereon.
RESOLVED FURTHER, that all acts and things previously done and
performed (or caused to be done and performed) in the name and on behalf of
the Corporation and Carlyle prior to the date of these resolutions in
connection with the transactions contemplated by the Purchase Agreement are
hereby ratified, confirmed and approved.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the
seal of the Corporation on _____________, 1998.
Name: __________________________
Title: Secretary
[CORPORATE SEAL]
<PAGE>
EXHIBIT 4
BUYER AUTHORIZING RESOLUTION
The undersigned, ____________________________________________, Secretary to
TRIZECHAHN CENTERS INC., a California corporation (the "Corporation"),
hereby certifies as follows:
1. The undersigned is the duly elected, qualified and acting
Secretary of the Corporation, and as such has custody and control of the
records and seal of the Corporation.
2. The undersigned has full power and authority to execute
and deliver this Certificate.
3. The Corporation is a general partner in OAKRIDGE
ASSOCIATES, a California general partnership (the "Partnership").
4. The following Resolutions are a true, complete and
correct copy of the Resolutions duly authorized and adopted by the Board of
Directors of the Corporation on or before the date hereof, are now in full
force and effect and have not been amended or revoked:
RESOLVED, that the Corporation hereby approves of the
purchase by the Corporation of all the partnership interests in the
Partnership of CARLYLE REAL ESTATE LIMITED PARTNERSHIP-VII, an Illinois
limited partnership ("Carlyle"), for the price and on the other terms and
conditions substantially as set forth in that certain Oakridge Agreement
for Purchase and Sale of Partnership Interest (the "Purchase Agreement") on
April __, 1998 (the "Effective Date"), by and between Carlyle and the
Corporation. The consummation of all transactions contemplated in the
Purchase Agreement, and the execution and delivery of each of the documents
required to be delivered thereunder, are hereby approved.
RESOLVED FURTHER, that either (a) _____________________,
as __________________ of the Corporation, acting alone, or
(b) ___________________________________, as __________________ of the
Corporation, acting alone, or (c) any two officers of the Corporation,
acting together, are each authorized, empowered and directed to take
further action and to execute, make oath to, acknowledge and deliver, from
time to time in the name and on behalf of the Corporation, such other
agreements, instruments, certificates or documents and to do or to cause to
be done any and all such other acts and things as such officer or officers
may deem necessary, proper, appropriate or advisable to consummate the
transactions contemplated by the Purchase Agreement and to carry out the
intent of the forgoing resolutions, the taking of such actions to be
conclusive evidence that the same have been authorized and approved by the
Board of Directors of the Corporation.
<PAGE>
RESOLVED FURTHER, that all acts and things previously
done and performed (or caused to be done and performed) in the name and on
behalf of the Corporation and Carlyle prior to the date of these
resolutions in connection with the transactions contemplated by the
Purchase Agreement are hereby ratified, confirmed and approved.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the
seal of the Corporation on _____________, 1998.
Name: ___________________________
Title: Secretary
[CORPORATE SEAL]
<PAGE>
EXHIBIT 6
CERTIFICATE OF NON-FOREIGN STATUS
Section 1445 of the Internal Revenue Code provides that a
transferee of a U.S. real property interest must withhold tax if the
transferor is a foreign person. To inform TRIZECHAHN CENTERS INC., a
California corporation ("Transferee"), that withholding of tax is not
required upon the disposition of a U.S. real property interest by CARLYLE
REAL ESTATE LIMITED PARTNERSHIP-VII, an Illinois limited partnership
("Carlyle"), the undersigned hereby certifies the following on behalf of
Carlyle:
1. Carlyle is not a foreign corporation, foreign
partnership, foreign trust, or foreign estate (as those terms are defined
in the Internal Revenue Code and Income Tax Regulations).
2. Carlyle's U.S. employer identification number is
______________.
3. Carlyle's office address is:
CARLYLE REAL ESTATE LIMITED PARTNERSHIP-VII
c/o JMB Realty Corporation
900 North Michigan Avenue
Chicago, Illinois 60611-1575
Attn: Mr. Glenn Emig
Carlyle understands that this certification may be disclosed to
the Internal Revenue Service by Transferee and that any false statement
contained herein could be punished by fine, imprisonment, or both.
<PAGE>
Under penalties of perjury, I declare that I have examined this
certification and to the best of my knowledge and belief it is true,
correct and complete and I further declare that I have authority to sign
this document on behalf of Carlyle.
Date: _____________, 19__
CARLYLE REAL ESTATE LIMITED PARTNERSHIP-VII,
an Illinois limited partnership
By: JMB REALTY CORPORATION,
a Delaware corporation,
General Partner
By:
Name: ________________________
Title: _______________________
By:
Name: ________________________
Title: _______________________
EXHIBIT 10.2
- ------------
THIS ASSIGNMENT AND ASSUMPTION OF PARTNERSHIP INTEREST ("Assignment")
is made effective as of April __, 1998, by and between CARLYLE REAL ESTATE
LIMITED PARTNERSHIP-VII, an Illinois limited partnership ("Assignor") and
HAHN CAPTIAL CORPORATION, a California corporation ("Assignee") with
reference to the following matters:
A. PARTNERSHIP. Assignor and TrizecHahn Centers Inc., a
California corporation ("TrizecHahn"), an affiliate of Assignee, are
general partners in Oakridge Associates, a California general partnership
(the "Partnership").
B. PURCHASE AGREEMENT. Assignor and TrizecHahn entered into that
certain Oakridge Agreement for Purchase and Sale of Partnership Interest
(the "Purchase Agreement") on April 3, 1998 (the "Effective Date"),
regarding the purchase and sale of all of Assignor's interest in the
Partnership, including, without limitation, all of its interest in capital,
profits, liquidation proceeds, distributions and all other rights and
interests under the Partnership Agreement or relating to the Partnership
(collectively, the "Partnership Interest"). TrizecHahn has assigned its
interest in the Purchase Agreement to Assignee.
C. PURPOSE. Pursuant to the Purchase Agreement, Assignor desires
to assign its Partnership Interest to Assignee, and Assignee desires to
accept such assignment and assume all obligations and responsibilities of
Assignor with respect to its Partnership Interest, as hereinafter provided.
NOW, THEREFORE, the parties agree as follows:
1. ASSIGNMENT. Assignor hereby assigns, conveys, transfers
and delivers all of the Partnership Interest to Assignee.
2. ACCEPTANCE OF ASSIGNMENT AND ASSUMPTION.
2.1 Assignee hereby accepts the foregoing assignment of
the Partnership Interest, and assumes all liabilities associated with the
Partnership Interest arising after the date of this Assignment (excepting
only such matters, if any, as may be expressly provided in the Purchase
Agreement).
2.2 Assignee acknowledges having read and understood
the Partnership's Articles of Partnership made and entered into as of
October 15, 1977 (the "Partnership Agreement"), and hereby agrees to be
bound by each and every term thereof.
3. GENERAL PROVISIONS.
3.1 NECESSARY ACTS. Each party agrees to perform any
further acts, and to execute and deliver any further documents, that may be
reasonably necessary or appropriate to carry out this Assignment.
3.2 AMENDMENT. Any oral representations or
modifications concerning this Assignment shall be of no force or effect.
This Assignment may be amended only in a writing, signed by the party to be
charged.
3.3 CAPTIONS. Paragraph headings or captions are
inserted as a matter of convenience and reference, and in no way define,
limit, extend or describe the scope of this Assignment or any provision
hereof.
3.4 GOVERNING LAW. This Assignment shall be governed
by the laws of the State of California.
3.5 COUNTERPARTS AND FACSIMILES. This Assignment may
be executed in multiple copies, each of which will be deemed an original,
but all of which will constitute one Assignment after each party has signed
<PAGE>
such a counterpart. An executed counterpart may be delivered by
transmission of a facsimile copy, promptly followed by delivery of the
original in accordance with this Agreement, and in such a case, delivery
shall be deemed effective upon transmission of the facsimile copy.
3.6 SUCCESSORS AND ASSIGNS. This instrument shall bind
and inure to the benefit of the respective heirs, personal representatives,
grantees, successors and assigns of the parties hereto.
3.7 INCORPORATION BY REFERENCE. The covenants,
agreements and limitations (including, but not limited to, the limitations
of liability provided in Section 12.20 of the Purchase Agreement) provided
in the Purchase Agreement with respect to the Partnership Interest are
incorporated herein by this reference as if set out in full herein.
IN WITNESS WHEREOF, Assignor and Assignee have caused this
Assignment to be executed effective as of the date and year first above
written.
ASSIGNOR: CARLYLE REAL ESTATE LIMITED PARTNERSHIP-VII,
an Illinois limited partnership
By: JMB Realty Corporation,
a Delaware corporation,
General Partner
By:
Name: ________________________
Title: _______________________
By:
Name: ________________________
Title: _______________________
ASSIGNEE: HAHN CAPITAL CORPORATION,
a California corporation
By:
Name: ________________________
Title: _______________________
By:
Name: ________________________
Title: _______________________
<PAGE>
JMB AUTHORIZING RESOLUTION
The undersigned, ____________________________________________,
Secretary to JMB REALTY CORPORATION, a Delaware corporation (the
"Corporation"), hereby certifies as follows:
1. The undersigned is the duly elected, qualified and acting
Secretary of the Corporation, and as such has custody and control of the
records and seal of the Corporation.
2. The undersigned has full power and authority to execute
and deliver this Certificate.
3. The Corporation is the sole General Partner of CARLYLE
REAL ESTATE LIMITED PARTNERSHIP-VII, an Illinois limited partnership
("Carlyle"). Carlyle is a general partner in OAKRIDGE ASSOCIATES, a
California general partnership (the "Partnership").
4. The following Resolutions are a true, complete and
correct copy of the Resolutions duly authorized and adopted by the Board of
Directors of the Corporation on or before the date hereof, are now in full
force and effect and have not been amended or revoked:
RESOLVED, that the Corporation hereby approves of the
sale by Carlyle of all its partnership interests in the Partnership , to
TRIZECHAHN CENTERS, INC., a California corporation ("Buyer") or its
affiliate, for the price and on the other terms and conditions
substantially as set forth in that certain Oakridge Agreement for Purchase
and Sale of Partnership Interest (the "Purchase Agreement") on April 3,
1998 (the "Effective Date"), by and between Carlyle and Buyer. The
consummation of all transactions contemplated in the Purchase Agreement,
and the execution and delivery of each of the documents required to be
delivered thereunder, are hereby approved.
RESOLVED FURTHER, that either (a) ___________________________,
as __________________ of the Corporation, acting alone, or
(b) ________________________________, as __________________ of the
Corporation, acting alone, or (c) any two officers of the Corporation,
acting together, are each authorized, empowered and directed to take
further action and to execute, make oath to, acknowledge and deliver, from
time to time in the name and on behalf of the Corporation, and the
Corporation is authorized, empowered and directed to take further action
and to execute, make oath to, acknowledge and deliver, from time to time in
the name and on behalf of Carlyle, such other agreements, instruments,
certificates or documents and to do or to cause to be done any and all such
other acts and things as such officer or officers may deem necessary,
proper, appropriate or advisable to consummate the transactions
contemplated by the Purchase Agreement and to carry out the intent of the
forgoing resolutions, the taking of such actions to be conclusive
<PAGE>
evidence that the same have been authorized and approved by the Board
of Directors of the Corporation and by Carlyle.
RESOLVED FURTHER, that, by these Resolutions, all such actions
as may be necessary pursuant to the partnership agreement of Carlyle have
now been taken, to authorize Carlyle's execution and delivery of the
Purchase Agreement, consummation of the transactions contemplated thereby
and execution and delivery of each of the documents required to be
delivered thereunder, and Buyer may rely thereon.
RESOLVED FURTHER, that all acts and things previously done and
performed (or caused to be done and performed) in the name and on behalf of
the Corporation and Carlyle prior to the date of these resolutions in
connection with the transactions contemplated by the Purchase Agreement are
hereby ratified, confirmed and approved.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the
seal of the Corporation on _____________, 1998.
Name: ___________________________________
Title: Secretary
[CORPORATE SEAL]
<PAGE>
CERTIFICATE OF NON-FOREIGN STATUS
Section 1445 of the Internal Revenue Code provides that a transferee
of a U.S. real property interest must withhold tax if the transferor is a
foreign person. To inform HAHN CAPITAL CORPORATION, a California
corporation ("Transferee"), that withholding of tax is not required upon
the disposition of a U.S. real property interest by CARLYLE REAL ESTATE
LIMITED PARTNERSHIP-VII, an Illinois limited partnership ("Carlyle"), the
undersigned hereby certifies the following on behalf of Carlyle:
1. Carlyle is not a foreign corporation, foreign
partnership, foreign trust, or foreign estate (as those terms are defined
in the Internal Revenue Code and Income Tax Regulations).
2. Carlyle's U.S. employer identification number is
______________.
3. Carlyle's office address is:
CARLYLE REAL ESTATE LIMITED PARTNERSHIP-VII
c/o JMB Realty Corporation
900 North Michigan Avenue
Chicago, Illinois 60611-1575
Attn: Mr. Glenn Emig
Carlyle understands that this certification may be disclosed to the
Internal Revenue Service by Transferee and that any false statement
contained herein could be punished by fine, imprisonment, or both.
<PAGE>
Under penalties of perjury, I declare that I have examined this
certification and to the best of my knowledge and belief it is true,
correct and complete and I further declare that I have authority to sign
this document on behalf of Carlyle.
Date: April __, 1998
CARLYLE REAL ESTATE LIMITED PARTNERSHIP-VII,
an Illinois limited partnership
By: JMB REALTY CORPORATION,
a Delaware corporation,
General Partner
By:
Name: _________________________
Title: ________________________
By:
Name: _________________________
Title: ________________________
