SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
Annual Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the fiscal year
ended December 31, 1995 Commission file number 0-9555
JMB INCOME PROPERTIES, LTD. - VII
------------------------------------------------------
(Exact name of registrant as specified in its charter)
Illinois 36-2999384
(State of organization) (I.R.S. Employer Identification No.)
900 N. Michigan Ave., Chicago, Illinois 60611
(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code 312-915-1987
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange on
Title of each class which registered
- ------------------- -------------------------
None None
Securities registered pursuant to Section 12(g) of the Act:
LIMITED PARTNERSHIP INTERESTS
(Title of class)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes X No
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K X
State the aggregate market value of the voting stock held by nonaffiliates
of the registrant. Not applicable.
Documents incorporated by reference: None
TABLE OF CONTENTS
Page
----
PART I
Item 1. Business. . . . . . . . . . . . . . . . . . . . 1
Item 2. Properties. . . . . . . . . . . . . . . . . . . 4
Item 3. Legal Proceedings . . . . . . . . . . . . . . . 6
Item 4. Submission of Matters to a
Vote of Security Holders. . . . . . . . . . . . 6
PART II
Item 5. Market for the Partnership's
Limited Partnership Interests and
Related Security Holder Matters . . . . . . . . 6
Item 6. Selected Financial Data . . . . . . . . . . . . 7
Item 7. Management's Discussion and
Analysis of Financial Condition and
Results of Operations . . . . . . . . . . . . . 13
Item 8. Financial Statements and
Supplementary Data. . . . . . . . . . . . . . . 16
Item 9. Changes in and Disagreements with
Accountants on Accounting and
Financial Disclosures . . . . . . . . . . . . . 38
PART III
Item 10. Directors and Executive Officers
of the Partnership. . . . . . . . . . . . . . . 38
Item 11. Executive Compensation. . . . . . . . . . . . . 41
Item 12. Security Ownership of Certain
Beneficial Owners and Management. . . . . . . . 42
Item 13. Certain Relationships and
Related Transactions. . . . . . . . . . . . . . 43
PART IV
Item 14. Exhibits, Financial Statement Schedules,
and Reports on Form 8-K . . . . . . . . . . . . 43
SIGNATURES. . . . . . . . . . . . . . . . . . . . . . . . . . 45
i
PART I
ITEM 1. BUSINESS
All references to "Notes" are to Notes to Consolidated Financial
Statements contained in this report.
The registrant, JMB Income Properties Ltd.-VII, (the "Partnership"),
is a limited partnership formed in late 1978 and currently governed by the
Revised Uniform Limited Partnership Act of the State of Illinois to invest
in improved income-producing commercial and residential real property. The
Partnership sold $60,500,000 in Limited Partnership Interests (the
"Interests") commencing on January 18, 1980 pursuant to a Registration
Statement on Form S-11 under the Securities Act of 1933 (Registration No.
2-65390). A total of 60,505 Interests were sold to the public at $1,000
per Interest. The offering closed on May 30, 1980. No Limited Partner has
made any additional capital contribution after such date. The Limited
Partners of the Partnership share in their portion of the benefits of
ownership of the Partnership's real property investments according to the
number of Interests held.
The Partnership is engaged solely in the business of the acquisition,
operation and sale and disposition of equity real estate investments. Such
equity investments are held by fee title and/or through joint venture
partnership interests. The Partnership's real estate investments are
located in the states of Iowa and Illinois. A presentation of information
about industry segments, geographic regions, raw materials, or seasonality
is not applicable and would not be material to an understanding of the
Partnership's business taken as a whole. Pursuant to the Partnership
agreement, the Partnership is required to terminate no later than October
31, 2028. The Partnership is self-liquidating in nature. At sale of a
particular property, the net proceeds, if any, are generally distributed or
reinvested in existing properties rather than invested in acquiring
additional properties. As discussed further in Item 7, the marketplaces in
which the portfolio operates and real estate markets in general are in a
recovery mode. The Partnership currently expects to conduct an orderly
liquidation of its remaining investment portfolio as quickly as practicable
and to wind up its affairs not later than December 31, 1999, barring any
unforeseen economic developments. (Reference is also made to Note 1.)
The Partnership has made the real property investments set forth in
the following table:
<TABLE>
<CAPTION>
SALE OR DISPOSITION
DATE OR IF OWNED
AT DECEMBER 31, 1995,
NAME, TYPE OF PROPERTY DATE OF ORIGINAL INVESTED
AND LOCATION (e) SIZE PURCHASE CAPITAL PERCENTAGE (a) TYPE OF OWNERSHIP (b)
- ---------------------- ---------- -------- ---------------------- ---------------------
<S> <C> <C> <C> <C>
Two Penn Center Plaza
office building
Philadelphia,
Pennsylvania . . . . . 502,000 sq. ft. 12-1-79 6-25-86 fee ownership of land and
n.r.a. improvements (through
joint venture partnership)
Huron Mall
shopping center
Huron, South Dakota. . 155,000 sq. ft. 5-1-80 1-21-88 fee ownership of improve-
g.l.a. ments and ground lease-
hold interest in land
One Woodfield Lake
office building
Schaumburg, Illinois . 204,000 sq. ft. 6-4-80 14% fee ownership of land and
n.r.a. improvements (through joint
venture partnership) (c)(f)
Westdale Mall
shopping center
Cedar Rapids, Iowa . . 733,000 sq. ft. 9-19-80 20% fee ownership of improve-
g.l.a. ments and ground lease-
hold interest in land
(through joint venture
partnership) (c)(d)(f)
Clackamas Town Center
shopping center
Clackamas County,
Oregon . . . . . . . . 435,000 sq. ft. 1-20-81 1-30-92 fee ownership of improve-
g.l.a. ments and ground lease-
hold interest in land
(through joint venture
partnership)
Oklahoma Distribution
Center
industrial warehouse
Oklahoma City,
Oklahoma . . . . . . . 465,000 sq. ft. 3-12-81 7-1-92 fee ownership of land and
improvements
<FN>
- ---------------
(a) The computation of this percentage for properties held at
December 31, 1995 does not include amounts invested from sources other than
the original net proceeds of the public offering as described above and in
Item 7.
(b) Reference is made to Note 4 and to Schedule III filed with
this annual report for the current outstanding principal balances and a
description of the long-term mortgage indebtedness secured by the
Partnership's real property investments.
(c) Reference is made to Note 3 for a description of the joint
venture partnership through which the Partnership made this real property
investment.
(d) Reference is made to Note 6(b) for a description of the
leasehold interest, under a ground lease, in the land on which this real
property investment is situated.
(e) Reference is made to Item 8 - Schedule III filed with this
annual report for further information concerning real estate taxes and
depreciation.
(f) Reference is made to Item 6 - Selected Financial Data for
additional operating and lease expiration data concerning this investment
property.
</TABLE>
The Partnership's real property investments are subject to competition
from similar types of properties (including in certain areas properties
owned or advised by affiliates of the General Partners) in the respective
vicinities in which they are located. Such competition is generally for
the retention of existing tenants. Additionally, the Partnership is in
competition for new tenants in markets where significant vacancies are
present. Reference is made to Item 7 below for a discussion of competitive
conditions and future renovation and capital improvement plans of the
Partnership and certain of its significant investment properties.
Approximate occupancy levels for the properties are set forth in Item 2
below to which reference is hereby made. The Partnership maintains the
suitability and competitiveness of its properties in its markets primarily
on the basis of effective rents, tenant allowances and service provided to
tenants. In the opinion of the Managing General Partner of the
Partnership, the investment properties held at December 31, 1995 are
adequately insured.
Reference is made to Note 6(a) for a schedule of minimum lease
payments to be received in each of the next five years, and in the
aggregate thereafter, under leases in effect at the Partnership's
properties as of December 31, 1995.
The Partnership has no employees.
The terms of transactions between the Partnership, the General
Partners and their affiliates are set forth in Item 11 below to which
reference is hereby made for a description of such terms and transactions.
ITEM 2. PROPERTIES
The Partnership owns through joint venture partnerships the properties
or interests in the properties referred to under Item 1 above to which
reference is hereby made for a description of said properties.
The following is a listing of principal businesses or occupations and
approximate physical occupancy levels by quarter during fiscal years 1995
and 1994 for the Partnership's investment properties owned during 1995:
<TABLE>
<CAPTION>
1994 1995
------------------------- -------------------------
At At At At At At At At
Principal Business 3/31 6/30 9/30 12/31 3/31 6/30 9/30 12/31
------------------ ---- ---- ---- ----- ---- ---- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1. One Woodfield Lake
Schaumburg, Insurance
Illinois. . . . . . . . . . Business Machines 90% 93% 93% 87% 88% 88% 88% 88%
2. Westdale Mall
Cedar Rapids, Iowa. . . . . Retail 88% 90% 89% 92% 93% 94% 94% 94%
<FN>
- ----------
Reference is made to Item 6, Item 7 and Note 6 for further information regarding property occupancy,
competitive conditions and tenant leases at the Partnership's investment properties.
</TABLE>
ITEM 3. LEGAL PROCEEDINGS
The Partnership is not subject to any material pending legal
proceedings.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
There were no matters submitted to a vote of security holders during
fiscal years 1994 and 1995.
PART II
ITEM 5. MARKET FOR THE PARTNERSHIP'S LIMITED PARTNERSHIP INTERESTS
AND RELATED SECURITY HOLDER MATTERS
As of December 31, 1995, there were 5,655 record holders of Interests
of the Partnership. There is no public market for Interests and it is not
anticipated that a public market for Interests will develop. Upon request,
the Managing General Partner may provide information relating to a
prospective transfer of Interests to an investor desiring to transfer his
Interests. The price to be paid for the Interests, as well as any other
economic aspects of the transaction, will be subject to negotiation by the
investor. There are certain conditions and restrictions on the transfer of
Interests, including, among other things, the requirement that the
substitution of a transferee of Interests as a Limited Partner of the
Partnership be subject to the written consent of the Managing General
Partner. The rights of a transferee of Interests who does not become a
substituted Limited Partner will be limited to the rights to receive his
share of profits or losses and cash distributions from the Partnership, and
such transferee will not be entitled to vote such Interests. No transfer
will be effective until the first day of the next succeeding calendar
quarter after the requisite transfer form satisfactory to the Managing
General Partner has been received by the Managing General Partner. The
transferee consequently will not be entitled to receive any cash
distributions or any allocable share of profits or losses for tax purposes
until such next succeeding calendar quarter. Profits or losses from
operations of the Partnership for a calendar year in which a transfer
occurs will be allocated between the transferor and the transferee based
upon the number of quarterly periods in which each was recognized as the
holder of Interests, without regard to the results of Partnership's
operations during particular quarterly periods and without regard to
whether cash distributions were made to the transferor or transferee.
Profits or losses arising from the sale or other disposition of Partnership
properties will be allocated to the recognized holder of the Interests as
of the last day of the quarter in which the Partnership recognized such
profits or losses. Cash distributions to a holder of Interests arising
from the sale or other disposition of Partnership properties will be
distributed to the recognized holder of the Interests as of the last day of
the quarterly period with respect to which distribution is made.
Reference is made to Item 6 below for a discussion of cash
distributions made to the Limited Partners.
<TABLE>
ITEM 6. SELECTED FINANCIAL DATA
JMB INCOME PROPERTIES, LTD. - VII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
YEARS ENDED DECEMBER 31, 1995, 1994, 1993, 1992 AND 1991
(NOT COVERED BY INDEPENDENT AUDITORS' REPORT)
<CAPTION>
1995 1994 1993 1992 1991
------------- ------------- ----------- ------------ ------------
<S> <C> <C> <C> <C> <C>
Total income. . . . . . . . $ 12,143,574 11,561,134 11,342,933 12,693,056 25,582,343
============= ============= =========== ============ ============
Operating earnings
(loss) . . . . . . . . . . $ (403,150) (735,519) (934,865) 499,638 943,447
Venture partners'
share of ventures'
operations . . . . . . . . 99,566 204,336 327,194 280,152 (721,965)
------------- ------------- ----------- ------------ ------------
Net operating earnings
(loss) . . . . . . . . . . (303,584) (531,183) (607,671) 779,790 221,482
Gain on sale of
investment properties,
net of venture
partner's share. . . . . . -- -- -- 19,415,770 --
------------- ------------- ----------- ------------ ------------
Net earnings (loss) . . . . $ (303,584) (531,183) (607,671) 20,195,560 221,482
============= ============= =========== ============ ============
Net earnings (loss)
per Interest (b):
Net operating
earnings (loss). . . . . $ (4.82) (8.43) (9.64) 12.37 3.51
Gain on sale of
investment properties,
net of venture
partner's share . . . . -- -- -- 290.41 --
------------- ------------- ----------- ------------ ------------
Net earnings (loss) . . . . $ (4.82) (8.43) (9.64) 302.78 3.51
============= ============= =========== ============ ============
Total assets. . . . . . . . $ 35,848,308 37,210,551 38,663,940 45,183,896 75,205,512
Long-term debt (net
of unamortized
discounts) . . . . . . . . $ 33,082,901 21,059,132 33,666,734 21,577,752 50,593,894
Cash distributions
per Interest (c) . . . . . $ 8.00 8.00 38.00 439.85 23.40
============= ============= =========== ============ ============
<FN>
- ---------------
(a) The above selected financial data should be read in
conjunction with the consolidated financial statements and the related
notes appearing elsewhere in this annual report.
(b) The net earnings (loss) per Interest is based on the number
of Interests outstanding at the end of each period (60,505).
(c) Cash distributions from the Partnership are generally not
equal to Partnership's income (loss) for financial reporting or Federal
income tax purposes. Each Partner's taxable income (or loss) from the
Partnership in each year is equal to his allocable share of the taxable
income (loss) of the Partnership, without regard to the cash generated or
distributed by the Partnership. Accordingly, cash distributions to the
Limited Partners since the inception of the Partnership have not resulted
in taxable income to such Limited Partners and have therefore represented a
return of capital.
</TABLE>
<TABLE>
SIGNIFICANT PROPERTY - SELECTED RENTAL AND OPERATING DATA AS OF DECEMBER 31, 1995
<CAPTION>
Property
- --------
One Woodfield a) The net rentable area ("NRA") occupancy rate and average base rent
Lake Office Plaza: per square foot as of December 31 for each of
the last five years were as follows:
NRA Avg. Base Rent Per
December 31, Occupancy Rate Square Foot (1)
------------ -------------- ------------------
<S> <C> <C> <C> <C>
1991 87% $13.82
1992 90% 13.97
1993 89% 15.28
1994 87% 15.46
1995 88% 14.89
<FN>
(1) Average gross base rent per square foot is based on NRA occupied
as of December 31 of each year.
(2) Gross base rents do not include tenant allowances or certain
other leasing concessions.
</TABLE>
<TABLE>
<CAPTION>
Base Rent Scheduled Lease Lease
b) Significant Tenants Square Feet Per Annum Expiration Date Renewal Option(s)
------------------- ----------- --------- --------------- -----------------
<S> <C> <C> <C> <C> <C> <C>
US Life Insurance 52,462 $1,077,335 8/2000 1-5 Year Term
(Insurance Company)
John Hancock
Mutual Life 51,758 646,975 8/2000 N/A
(Insurance Company)
Xerox Corporation 37,872 716,371 4/1997 2-5 Year Terms
(Business Machines)
</TABLE>
<TABLE>
<CAPTION>
c) The following table sets forth certain
information with respect to the expiration
of leases for the next ten years at the
One Woodfield Lake Office Plaza:
Annualized Percent of
Number of Approx. Total Base Rent Total 1995
Year Ending Expiring NRA of Expiring of Expiring Base Rent
December 31, Leases Leases (1) Leases Expiring
------------ --------- --------------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
1996 2 2,191 $ 27,432 1%
1997 2 40,365 751,274 26%
1998 7 18,624 119,532 4%
1999 -- -- -- --
2000 4 107,634 1,772,701 62%
2001 3 10,601 201,374 7%
2002 -- -- -- --
2003 -- -- -- --
2004 -- -- -- --
2005 -- -- -- --
<FN>
(1) Excludes leases that expire in 1996 for which
renewal leases or leases with replacement tenants
have been executed as of March 25, 1996.
</TABLE>
<TABLE>
<CAPTION>
Property
- --------
Westdale Mall: a) The gross leasable area ("GLA") occupancy rate and average base rent
per square foot as of December 31 for each of
the last five years were as follows:
GLA Avg. Base Rent Per
December 31, Occupancy Rate Square Foot (1)
------------ -------------- ------------------
<S> <C> <C> <C> <C>
1991 95% $6.99
1992 96% 6.97
1993 90% 7.64
1994 92% 7.72
1995 94% 7.74
<FN>
(1) Average gross base rent per square foot is based on GLA occupied
as of December 31 of each year.
(2) Gross base rents do not include tenant allowances or certain
other leasing concessions.
</TABLE>
<TABLE>
<CAPTION>
Base Rent Scheduled Lease Lease
b) Significant Tenants Square Feet Per Annum Expiration Date Renewal Option(s)
------------------- ----------- --------- --------------- -----------------
<S> <C> <C> <C> <C> <C> <C>
J.C. Penney 147,439 $ 501,404 11/2009 3-5 Year Terms
(Department Store)
Younker Brothers
(Department Store) 100,000 219,000 3/2010 3-10 Year Terms
Peterson/Von Maur 100,000 515,775 10/2010 3-5 Year Terms
(Department Store)
EconoFoods 48,394 200,000 8/2000 2-5 Year Terms
(Grocery Store)
</TABLE>
<TABLE>
<CAPTION>
c) The following table sets forth certain
information with respect to the expiration
of leases for the next ten years at the
Westdale Mall:
Annualized Percent of
Number of Approx. Total Base Rent Total 1995
Year Ending Expiring GLA of Expiring of Expiring Base Rent
December 31, Leases Leases (1) Leases Expiring
------------ --------- --------------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
1996 10 16,201 $228,011 4%
1997 11 18,817 295,839 6%
1998 9 15,351 303,865 6%
1999 16 63,884 690,454 13%
2000 14 78,809 738,470 14%
2001 6 25,921 288,588 5%
2002 8 16,076 259,118 5%
2003 7 22,966 336,429 6%
2004 5 13,305 185,355 3%
2005 6 37,220 307,599 6%
<FN>
(1) Excludes leases that expire in 1996 for which
renewal leases of leases with replacement tenants
have been executed as of March 25, 1996.
</TABLE>
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
On January 18, 1980, the Partnership commenced an offering of
$60,500,000 pursuant to a Registration Statement on Form S-11 under the
Securities Act of 1933. All Interests were subscribed and issued between
January 18, 1980 and May 30, 1980 pursuant to the public offering from
which the Partnership received gross proceeds of $60,500,000.
After deducting selling expenses and other offering costs, the
Partnership had approximately $54,700,000 with which to make investments in
income-producing commercial and residential real property, to pay legal
fees and other costs (including acquisition fees) related to such
investments and for working capital. A portion of such proceeds was
utilized to acquire the properties described in Item 1 above.
At December 31, 1995, the Partnership and its consolidated ventures
had cash and cash equivalents of approximately $6,182,000. Such funds are
available for distributions to partners and for working capital
requirements including costs to be incurred for capital additions and
tenant improvements at Westdale Mall and the Partnership's portion of
tenant improvement costs which may be incurred at One Woodfield Lake. The
Partnership and its consolidated ventures have currently budgeted in 1996
approximately $848,000 for tenant improvements and other capital
expenditures, primarily at Westdale Mall as discussed below. The
Partnership's share of such items in 1996 is currently budgeted to be
approximately $558,000. Actual amounts expended may vary depending on a
number of factors including actual leasing activity, results of property
operations, liquidity considerations and other market conditions over the
course of the year. The sources of capital (in addition to the cash and
cash equivalents and short-term investments noted above) for such items and
for both short-term and long-term future liquidity and distributions are
expected to be through net cash generated by the Partnership's investment
properties and through the sale of such investments. However, the
Partnership does not consider the One Woodfield Lake investment property to
be a significant source of short or long-term liquidity. In such regard,
reference is made to the Partnership's property specific discussions below
and also to the Partnership's disclosure of certain property lease
expirations in Item 6. The Partnership and its ventures' mortgage
obligations are all non-recourse. Therefore, the Partnership and its
ventures are not obligated to pay mortgage indebtedness unless the related
property produces sufficient net cash flow from operations or sale.
The One Woodfield Lake building currently operates in a market which
is characterized by lower than normal occupancies and reduced net effective
rent levels. Such competitive conditions have resulted in operating
deficits during recent periods though the property is now generating a
nominal positive cash flow, which the Partnership must now escrow as a
result of its recent loan extension as discussed below. The long-term
mortgage loan secured by the property matured on September 1, 1995. The
joint venture has signed an extension of the maturity date of the mortgage
loan until September 1, 1998. Though the monthly mortgage loan payments
decline as a result of this extension, any excess cash flow, as defined,
must be escrowed at the property for future deficits and capital
improvements. As the leases of existing tenants expire, there will likely
be a negative impact on cash flow due to the downward pressure on net
effective market rental rates. Should the property not produce sufficient
cash flow to service its indebtedness, the joint venture may decide not to
commit any significant additional amounts of capital to this property due
to the fact that recovery of such amounts may be unlikely. As a result,
the joint venture would no longer have an ownership interest in the
property. In such event, the joint venture would recognize a gain for
financial reporting and Federal income tax reporting purposes without any
net realizable proceeds.
Although the area surrounding the Westdale Mall in Cedar Rapids, Iowa
has shown some signs of commercial and residential growth, the mall
continues to operate in a very competitive retail environment. Currently,
as leases at Westdale Mall expire, lease renewals and new leases are likely
to be at rental rates equal to or slightly below rates on existing leases.
In addition, new leases will likely require expenditures for lease
commission and tenant improvements prior to tenant occupancy. This
anticipated decline in rental rates, an anticipated increase in re-leasing
time and the costs upon releasing will result in a decrease in cash flow
from operations over the near term. The Partnership is also evaluating the
competitive positioning of this property in its market. The joint venture
intends to provide the resources necessary for the manager of the mall to
continue to attract new tenants. In such regard, in 1996, the joint
venture has budgeted a significant capital improvement program for the mall
in the approximate amount of $1,000,000, a portion of which is expected to
be funded from capital contributions from the venture partners and the
Partnership.
There are certain risks associated with the Partnership's investments
made through joint ventures including the possibility that the
Partnership's joint venture partners in an investment might become unable
or unwilling to fulfill their financial or other obligations, or that such
joint venture partners may have economic, business interests or goals that
are inconsistent with those of the Partnership.
As a result of the real estate market conditions discussed above, the
Partnership continues to conserve its working capital. All expenditures
are carefully analyzed and certain capital projects are deferred when
appropriate. In an effort to reduce partnership operating expenses, the
Partnership is likely to make semi-annual rather than quarterly
distributions of operating cash flow commencing with the 1996
distributions. The Partnership has also sought or is seeking additional
loan modifications where appropriate. By conserving working capital, the
Partnership will be in a better position to meet the future needs of its
properties since the availability of satisfactory outside sources of
capital may be limited given the portfolio's current debt levels. Due to
these factors, the Partnership has held its remaining investment properties
longer than originally anticipated in an effort to maximize the return to
the Limited Partners. However, after reviewing the remaining properties
and the marketplaces in which they operate, the General Partners of the
Partnership expect to be able to conduct an orderly liquidation of its
remaining investment portfolio as quickly as practicable. Therefore, the
affairs of the Partnership are expected to be wound up no later than
December 31, 1999 (sooner if the properties are sold in the near term),
barring unforeseen economic developments.
RESULTS OF OPERATIONS
The increase in cash and cash equivalents and the corresponding
decrease in short-term investments at December 31, 1995 as compared to
December 31, 1994 is primarily due to all of the Partnership's investments
in U.S. Government obligations being classified as cash equivalents at
December 31, 1995. Reference is made to Note 1.
The increase in interest, rents and other receivables at December 31,
1995 as compared to December 31, 1994 is primarily due to the accrual of
certain 1995 escalations due from tenants at the Partnership's investment
properties.
The decrease in escrow deposits at December 31, 1995 as compared to
December 31, 1994 is primarily due to the timing of payments of real estate
taxes at the Partnership's investment properties.
The decrease in current portion of long-term debt and corresponding
increase in long-term debt less current portion at December 31, 1995 as
compared to December 31, 1994 is primarily due to the reclassification in
1995 of the mortgage loan (with an outstanding balance at December 31, 1995
of $12,330,749) at the One Woodfield Lake investment property having its
maturity date extended to September 1, 1998 (Note 4(b)).
The decrease in accounts payable at December 31, 1995 as compared to
December 31, 1994 is primarily due to the timing of payments for property
operating expenses at the Partnership's investment properties.
The increase in tenant security deposits at December 31, 1995 as
compared to December 31, 1994 is primarily due to increased occupancy in
1995 at the Westdale Mall investment property.
The increase in rental income for 1995 as compared to 1994 is
primarily due to increased occupancy in 1995 at the Westdale Mall
investment property. The increase in rental income for 1994 as compared to
1993 is primarily due to increased occupancy in 1994 at the One Woodfield
Lake investment property.
The increase in interest income for 1995 as compared to 1994 is
primarily due to an increase in the Partnership's average investment
balance in U.S. Government obligations and other investments in 1995 and to
the higher yields received in 1995 related to these investments held by the
Partnership. The decrease in interest income for 1994 as compared to 1993
is primarily due to the decrease in the Partnership's average balance in
U.S. Government obligations in 1994 resulting from the temporary investment
in 1993 of the cash proceeds from the sale of the Clackamas Town Center and
the Oklahoma Distribution Center.
The increase in property operating expenses for 1995 as compared to
1994 is primarily due to increased repair and maintenance expenses at the
Westdale Mall investment property. Such costs are partially recoverable
from tenants.
The decrease in venture partners' share of ventures' loss from
operations for 1995 as compared to 1994 is primarily due to increased
rental income resulting from the increase in occupancy at the Westdale
investment property.
INFLATION
Due to the decrease in the level of inflation in recent years,
inflation generally has not had a material effect on rental income or
property operating expenses.
Inflation is not expected to significantly impact future operations
due to the expected liquidation of the Partnership by 1999. However, to
the extent that inflation in future periods would have an adverse impact on
property operating expenses, the effect would generally be offset by
amounts recovered from tenants as many of the long-term leases at the
Partnership's commercial properties have escalation clauses covering
increases in the cost of operating and maintaining the properties as well
as real estate taxes. Therefore, there should be little effect on
operating earnings if the properties remain substantially occupied. In
addition, substantially all of the leases at the Partnership's shopping
center investment contain provisions which entitle the Partnership to
participate in gross receipts of tenants above fixed minimum amounts.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
JMB INCOME PROPERTIES, LTD. - VII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
INDEX
Independent Auditors' Report
Consolidated Balance Sheets, December 31, 1995 and 1994
Consolidated Statements of Operations, years ended December 31,
1995, 1994 and 1993
Consolidated Statements of Partners' Capital Accounts (Deficits),
years ended December 31, 1995, 1994 and 1993
Consolidated Statements of Cash Flows, years ended December 31,
1995, 1994 and 1993
Notes to Consolidated Financial Statements
Schedule
--------
Consolidated Real Estate and Accumulated Depreciation III
Schedules not filed:
All schedules other than the one indicated in the index have been
omitted as the required information is inapplicable or the information is
presented in the financial statements or related notes.
INDEPENDENT AUDITORS' REPORT
The Partners
JMB INCOME PROPERTIES, LTD. - VII:
We have audited the consolidated financial statements of JMB Income
Properties, Ltd. - VII (a limited partnership) and consolidated ventures as
listed in the accompanying index. In connection with our audits of the
consolidated financial statements, we also have audited the financial
statement schedule as listed in the accompanying index. These consolidated
financial statements and financial statement schedule are the
responsibility of the General Partners of the Partnership. Our
responsibility is to express an opinion on these consolidated financial
statements and financial statement schedule based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles
used and significant estimates made by the General Partners of the
Partnership, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for
our opinion.
In our opinion, the consolidated financial statements referred to
above present fairly, in all material respects, the financial position of
JMB Income Properties, Ltd. - VII and consolidated ventures at December 31,
1995 and 1994, and the results of their operations and their cash flows for
each of the years in the three-year period ended December 31, 1995, in
conformity with generally accepted accounting principles. Also in our
opinion, the related financial statement schedule, when considered in
relation to the basic consolidated financial statements taken as a whole,
presents fairly, in all material respects, the information set forth
therein.
KPMG PEAT MARWICK LLP
Chicago, Illinois
March 25, 1996
<TABLE>
JMB INCOME PROPERTIES, LTD. - VII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
CONSOLIDATED BALANCE SHEETS
DECEMBER 31, 1995 AND 1994
ASSETS
------
<CAPTION>
1995 1994
------------ -----------
<S> <C> <C>
Current assets:
Cash and cash equivalents (note 1). . . . . . . . . . . . . . . . . . . $ 6,182,420 3,483,861
Short-term investments (note 1) . . . . . . . . . . . . . . . . . . . . -- 1,956,495
Interest, rents and other receivables . . . . . . . . . . . . . . . . . 1,240,876 1,011,048
Prepaid expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,541 18,412
Escrow deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . 414,466 798,114
------------ -----------
Total current assets. . . . . . . . . . . . . . . . . . . . . . . . . 7,846,303 7,267,930
------------ -----------
Investment properties, at cost (notes 2 and 3)-Schedule III:
Land. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,394,540 1,394,540
Buildings and improvements. . . . . . . . . . . . . . . . . . . . . . . 59,219,726 59,101,445
------------ -----------
60,614,266 60,495,985
Less accumulated depreciation . . . . . . . . . . . . . . . . . . . . . 38,155,769 35,834,904
------------ -----------
Total investment properties, net of accumulated depreciation. . . . . 22,458,497 24,661,081
Deferred expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,126,436 1,005,658
Accrued rents receivable. . . . . . . . . . . . . . . . . . . . . . . . . 1,947,136 2,056,774
Venture partner's deficit in venture (note 3) . . . . . . . . . . . . . . 2,469,936 2,219,108
------------ -----------
$ 35,848,308 37,210,551
============ ===========
JMB INCOME PROPERTIES, LTD. - VII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
CONSOLIDATED BALANCE SHEETS - CONTINUED
LIABILITIES AND PARTNERS' CAPITAL ACCOUNTS (DEFICITS)
-----------------------------------------------------
1995 1994
------------ -----------
Current liabilities:
Current portion of long-term debt (note 4). . . . . . . . . . . . . . . $ 306,980 12,603,179
Accounts payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . 946,999 1,031,081
Accrued interest. . . . . . . . . . . . . . . . . . . . . . . . . . . . 280,863 284,080
Accrued real estate taxes . . . . . . . . . . . . . . . . . . . . . . . 2,214,272 2,175,872
------------ -----------
Total current liabilities . . . . . . . . . . . . . . . . . . . . . . 3,749,114 16,094,212
Tenant security deposits. . . . . . . . . . . . . . . . . . . . . . . . . 222,631 92,429
Long-term debt, less current portion (note 4) . . . . . . . . . . . . . . 33,082,901 21,059,132
------------ -----------
Commitments and contingencies (notes 2, 3, 4(b) and 6)
Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . 37,054,646 37,245,773
------------ -----------
Venture partners' subordinated equity in ventures (note 3). . . . . . . . 1,631,431 1,961,141
Partners' capital accounts (deficits) (note 5):
General partners:
Capital contributions . . . . . . . . . . . . . . . . . . . . . . . . 1,000 1,000
Cumulative net earnings . . . . . . . . . . . . . . . . . . . . . . . 1,069,065 1,081,208
Cumulative cash distributions . . . . . . . . . . . . . . . . . . . . (7,978,262) (7,924,480)
------------ -----------
(6,908,197) (6,842,272)
------------ -----------
Limited partners (60,505 interests):
Capital contributions, net of offering costs. . . . . . . . . . . . . 54,676,276 54,676,276
Cumulative net earnings . . . . . . . . . . . . . . . . . . . . . . . 49,376,449 49,667,890
Cumulative cash distributions . . . . . . . . . . . . . . . . . . . . (99,982,297) (99,498,257)
------------ -----------
4,070,428 4,845,909
------------ -----------
Total partners' capital accounts (deficits) . . . . . . . (2,837,769) (1,996,363)
------------ -----------
$ 35,848,308 37,210,551
============ ===========
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
<TABLE>
JMB INCOME PROPERTIES, LTD. - VII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
CONSOLIDATED STATEMENTS OF OPERATIONS
YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
<CAPTION>
1995 1994 1993
------------ ------------ ------------
<S> <C> <C> <C>
Income:
Rental income . . . . . . . . . . . . . . . . . . . $ 11,836,675 11,306,831 10,902,498
Interest income . . . . . . . . . . . . . . . . . . 306,899 254,303 440,435
------------ ------------ ------------
12,143,574 11,561,134 11,342,933
------------ ------------ ------------
Expenses:
Mortgage and other interest . . . . . . . . . . . . 3,710,008 3,786,615 3,818,502
Depreciation. . . . . . . . . . . . . . . . . . . . 2,320,865 2,313,741 2,276,629
Property operating expenses . . . . . . . . . . . . 6,135,852 5,804,439 5,780,606
Professional services . . . . . . . . . . . . . . . 97,224 108,414 111,680
Amortization of deferred expenses . . . . . . . . . 210,956 200,877 187,021
General and administrative. . . . . . . . . . . . . 71,819 82,567 103,360
------------ ------------ ------------
12,546,724 12,296,653 12,277,798
------------ ------------ ------------
Operating loss . . . . . . . . . . . . . . . . 403,150 735,519 934,865
Venture partners' share of
ventures' operations (note 3) . . . . . . . . . . . (99,566) (204,336) (327,194)
------------ ------------ ------------
Net loss. . . . . . . . . . . . . . . . . . $ 303,584 531,183 607,671
============ ============ ============
Net loss per limited
partnership interest . . . . . . . . . . . . . . . . $ 4.82 8.43 9.64
============ ============ ============
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
<TABLE>
JMB INCOME PROPERTIES, LTD. - VII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
CONSOLIDATED STATEMENTS OF PARTNERS' CAPITAL ACCOUNTS (DEFICITS)
YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
<CAPTION>
GENERAL PARTNERS LIMITED PARTNERS (NOTE 1)
-------------------------------------------------- ---------------------------------------------------
CONTRI-
BUTIONS
NET NET OF NET
CONTRI- EARNINGS CASH OFFERING EARNINGS CASH
BUTIONS (LOSS) DISTRIBUTIONS TOTAL COSTS (LOSS) DISTRIBUTIONS TOTAL
------- ---------- ------------- ----------- ----------- ---------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balance
(deficit) at
December 31,
1992 . . . . . $ 1,000 1,126,762 (5,160,662) (4,032,900) 54,676,276 50,761,190 (96,715,027) 8,722,439
Cash distri-
butions
($38.00
per limited
partnership
interest). . . -- -- (2,710,036) (2,710,036) -- -- (2,299,190) (2,299,190)
Net loss
(note 5) . . . -- (24,307) -- (24,307) -- (583,364) -- (583,364)
------- ---------- ------------ ---------- ---------- ---------- ----------- ----------
Balance
(deficit) at
December 31,
1993 . . . . . 1,000 1,102,455 (7,870,698) (6,767,243) 54,676,276 50,177,826 (99,014,217) 5,839,885
Cash distri-
butions
($8.00
per limited
partnership
interest). . . -- -- (53,782) (53,782) -- -- (484,040) (484,040)
Net loss
(note 5) . . . -- (21,247) -- (21,247) -- (509,936) -- (509,936)
------- ---------- ------------ ---------- ---------- ---------- ----------- ----------
Balance
(deficit) at
December 31,
1994 . . . . . 1,000 1,081,208 (7,924,480) (6,842,272) 54,676,276 49,667,890 (99,498,257) 4,845,909
Cash distri-
butions
($8.00
per limited
partnership
interest). . . -- -- (53,782) (53,782) -- -- (484,040) (484,040)
Net loss
(note 5) . . . -- (12,143) -- (12,143) -- (291,441) -- (291,441)
------- ---------- ------------ ---------- ---------- ---------- ----------- ----------
Balance
(deficit) at
December 31,
1995 . . . . . $1,000 1,069,065 (7,978,262) (6,908,197) 54,676,276 49,376,449 (99,982,297) 4,070,428
======= ========== ============ ========== ========== ========== =========== ==========
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
<TABLE>
JMB INCOME PROPERTIES, LTD. - VII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
CONSOLIDATED STATEMENTS OF CASH FLOWS
YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
<CAPTION>
1995 1994 1993
----------- ----------- -----------
<S> <C> <C> <C>
Cash flows from operating activities:
Net loss. . . . . . . . . . . . . . . . . . . . . . . $ (303,584) (531,183) (607,671)
Items not requiring (providing) cash
or cash equivalents:
Depreciation. . . . . . . . . . . . . . . . . . . . 2,320,865 2,313,741 2,276,629
Amortization of deferred expenses . . . . . . . . . 210,956 200,877 187,021
Amortization of discounts on
long-term debt. . . . . . . . . . . . . . . . . . 215,762 200,368 193,930
Venture partners' share of ventures'
operations. . . . . . . . . . . . . . . . . . . . (99,566) (204,336) (327,194)
Changes in:
Interest, rents and other receivables . . . . . . . (120,190) (247,715) 141,969
Prepaid expenses. . . . . . . . . . . . . . . . . . 9,871 (5,632) (2,953)
Escrow deposits . . . . . . . . . . . . . . . . . . 383,648 (79,059) 1,057,524
Notes receivable. . . . . . . . . . . . . . . . . . -- -- 2,577,126
Accounts payable. . . . . . . . . . . . . . . . . . (84,082) (84,765) (120,459)
Accrued interest. . . . . . . . . . . . . . . . . . (3,217) (2,942) (2,691)
Accrued real estate taxes . . . . . . . . . . . . . 38,400 15,000 90,155
Tenant security deposits. . . . . . . . . . . . . . 130,202 (42,891) 26,857
----------- ----------- -----------
Net cash provided by
operating activities. . . . . . . . . . . . 2,699,065 1,531,463 5,490,243
----------- ----------- -----------
Cash flows from investing activities:
Net sales and maturities of
short-term investments. . . . . . . . . . . . . . . 1,956,495 2,446,978 3,510,036
Additions to investment properties
(net of related payables) . . . . . . . . . . . . . (118,281) (302,328) (2,290,767)
Payment of deferred expenses. . . . . . . . . . . . . (331,734) (289,313) (104,294)
----------- ----------- -----------
Net cash provided by
investing activities. . . . . . . . . . . . 1,506,480 1,855,337 1,114,975
----------- ----------- -----------
Cash flows from financing activities:
Principal payments on long-term debt. . . . . . . . . (488,192) (446,558) (408,486)
Distributions to venture partners . . . . . . . . . . (480,972) (304,829) (418,084)
Distributions to limited partners . . . . . . . . . . (484,040) (484,040) (2,299,190)
Distributions to general partners . . . . . . . . . . (53,782) (53,782) (2,710,036)
----------- ----------- -----------
Net cash used in
financing activities. . . . . . . . . . . . (1,506,986) (1,289,209) (5,835,796)
----------- ----------- -----------
Net increase in cash
and cash equivalents. . . . . . . . . . . . 2,698,559 2,097,591 769,422
Cash and cash equivalents,
beginning of year . . . . . . . . . . . . . 3,483,861 1,386,270 616,848
----------- ----------- -----------
Cash and cash equivalents,
end of year . . . . . . . . . . . . . . . . $ 6,182,420 3,483,861 1,386,270
=========== =========== ===========
Supplemental disclosure of
cash flow information:
Cash paid for mortgage and
other interest. . . . . . . . . . . . . . . . . . . $ 3,497,463 3,589,189 3,728,734
=========== =========== ===========
Non-cash financing activities . . . . . . . . . . . . $ -- -- --
=========== =========== ===========
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
JMB INCOME PROPERTIES, LTD. - VII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1995, 1994 AND 1993
(1) OPERATIONS AND BASIS OF ACCOUNTING
The Partnership holds (through joint ventures) two real estate
investments. Business activities consist of rentals to a wide variety of
commercial and retail companies, and the ultimate sale or disposition of
such real estate. The Partnership currently expects to conduct an orderly
liquidation of its remaining investment portfolio and wind up its affairs
not later than December 31, 1999.
The accompanying consolidated financial statements include the
accounts of the Partnership and its ventures, One Woodfield Lake
("Woodfield"), Westdale Associates ("Westdale") and Properties Partners -
the former owner of Clackamas Town Center Associates ("Clackamas") (note
3(d)). The effect of all transactions between the Partnership and the
ventures has been eliminated.
The Partnership's records are maintained on the accrual basis of
accounting as adjusted for Federal income tax reporting purposes. The
accompanying consolidated financial statements have been prepared from such
records after making appropriate adjustments to reflect the Partnership's
accounts in accordance with generally accepted accounting principles
("GAAP") and to consolidate the accounts of the ventures as described
above. Such GAAP and consolidation adjustments are not recorded on the
records of the Partnership. The net effect of these items for the years
ended December 31, 1995 and 1994 is summarized as follows:
<TABLE>
<CAPTION>
1995 1994
-------------------------------------------------------------
TAX BASIS
GAAP BASIS (Unaudited) GAAP BASIS TAX BASIS
------------ ----------- ------------ -----------
<S> <C> <C> <C> <C>
Total assets. . . . . . . . . . . . . $35,848,308 1,011,495 37,210,551 1,681,461
Partners' capital accounts
(deficits) (note 5):
General partners. . . . . . . . . . (6,908,197) (3,701,749) (6,842,272) (3,643,928)
Limited partners. . . . . . . . . . 4,070,428 4,699,418 4,845,909 5,307,977
Net earnings (loss)
(note 5):
General partners. . . . . . . . . . (12,143) (4,039) (21,247) (18,489)
Limited partners. . . . . . . . . . (291,441) (124,519) (509,936) (443,740)
Net loss per
limited partnership
interest . . . . . . . . . . . . . . (4.82) (2.06) (8.43) (7.33)
=========== ========== ========== ==========
</TABLE>
The net loss per limited partnership interest is based upon the
limited partnership interests outstanding at the end of each period
(60,505). Deficit capital accounts will result, through the duration of
the Partnership, in net gain for financial reporting and Federal income tax
reporting purposes.
The preparation of financial statements in accordance with GAAP
requires the Partnership to make estimates and assumptions that affect the
reported or disclosed amount of assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
Statement of Financial Accounting Standards No. 95 requires the
Partnership to present a statement which classifies receipts and payments
according to whether they stem from operating, investing or financing
activities. The required information has been segregated and accumulated
according to the classifications specified in the pronouncement. The
Partnership records amounts held in U.S. Government obligations at cost,
which approximates market. For the purposes of these statements, the
Partnership's policy is to consider all such amounts held with original
maturities of three months or less ($5,234,262 and $2,644,833 at December
31, 1995 and 1994, respectively) as cash equivalents with any remaining
amounts (generally with original maturities of one year or less) reflected
as short-term investments being held to maturity.
Discounts provided on long-term mortgage notes are amortized over the
terms of the related notes using the interest method.
Deferred expenses consist primarily of loan fees and lease commissions
which are amortized over the terms stipulated in the related agreements or
over the terms of the related leases using the straight line method.
Although certain leases of the Partnership provide for tenant
occupancy during periods for which no rent is due and/or increases in
minimum lease payments over the term of the lease, the Partnership accrues
rental income for the full period of occupancy on a straight-line basis.
Statement of Financial Accounting Standards No. 107 ("SFAS 107"),
"Disclosures about Fair Value of Financial Instruments", requires all
entities to disclose the SFAS 107 value of all financial assets and
liabilities for which it is practicable to estimate. Value is defined in
the Statement as the amount at which the instrument could be exchanged in a
current transaction between willing parties, other than in a forced or
liquidation sale. The Partnership believes the carrying amount of its
financial instruments classified as current assets and liabilities
(excluding current portion of long-term debt) approximates SFAS 107 value
due to the relatively short maturity of these instruments. There is no
quoted market value available for any of the Partnership's other
instruments. The debt, with a carrying balance of $33,389,881, has been
calculated to have an SFAS 107 value of $42,124,852 by discounting the
scheduled loan payments to maturity. Due to restrictions on
transferability and prepayment and the inability to obtain comparable
financing due to current levels of debt, previously modified debt terms or
other property specific competitive conditions, the Partnership would be
unable to refinance these properties to obtain such calculated debt amounts
reported. (See note 4.) The Partnership has no other significant
financial instruments.
No provision for State or Federal income taxes has been made as the
liability for such taxes is that of the partners rather than the
Partnership. However, in certain instances, the Partnership has been
required under applicable law to remit directly to the tax authorities
amounts representing withholding from distributions paid to partners.
(2) INVESTMENT PROPERTIES
The Partnership has acquired, either directly or through joint
ventures (note 3), two office buildings, three shopping centers and an
industrial warehouse as investments. Four properties have been sold by the
Partnership. Both of the remaining properties owned at December 31, 1995
were operating. The cost of the investment properties represents the total
cost to the Partnership and its ventures plus miscellaneous acquisition
costs.
Depreciation on the properties has been provided over the estimated
useful lives of the various components as follows:
YEARS
-----
Improvements (new)--straight-line or
150% declining balance. . . . . . . . . . . . . 5-35
Personal property (used)--straight-line or
150% declining balance. . . . . . . . . . . . . 5-10
Personal property (new)--straight-line or
200% declining balance. . . . . . . . . . . . . 5-10
====
The investment properties are pledged as security for the long-term
debt, for which there is no recourse to the Partnership.
Maintenance and repair expenses are charged to operations as incurred.
Significant betterments and improvements are capitalized and depreciated
over their estimated useful lives.
Under the Partnership's current impairment policy, provisions for
value impairment are recorded with respect to its investment property
pursuant to Statement of Financial Accounting Standards 121 ("SFAS 121"),
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to be Disposed of". Therefore, the Partnership does not anticipate
any effect on its consolidated financial statements upon full adoption of
SFAS 121 as required in the first quarter of 1996.
(3) VENTURE AGREEMENTS
The terms of the venture agreements are summarized as follows:
(a) General
The Partnership at December 31, 1995 is a party to two operating joint
venture agreements. Pursuant to such agreements, the Partnership made
initial capital contributions of approximately $35,585,000 (before legal
and other acquisition costs and its share of operating deficits as
discussed below). In general, the joint venture partners, who are either
the sellers (or their affiliates) of the property investments being
acquired, or parties which have contributed an interest in the property
being developed, or were subsequently admitted to the ventures, make no
cash contributions to the ventures, but their retention of an interest in
the property, through the joint venture, is taken into account in
determining the purchase price of the Partnership's interest, which is
determined by arm's-length negotiations. Under certain circumstances,
either pursuant to the venture agreements or due to the Partnership's
obligations as a general partner, the Partnership may be required to make
additional cash contributions to the ventures.
The Partnership has acquired, through the above ventures, one office
building and one regional shopping mall. The joint venture partners (who
were primarily responsible for constructing the properties) contributed any
excess of cost over the aggregate amount available from Partnership
contributions and financing and, to the extent such funds exceeded the
aggregate costs, were to retain such excesses. The venture properties have
been financed under various long-term debt arrangements as described in
note 4.
There are certain risks associated with the Partnership's investments
made through joint ventures including the possibility that the
Partnership's joint venture partners in an investment might become unable
or unwilling to fulfill their financial or other obligations, or that such
joint venture partners may have economic or business interests or goals
that are inconsistent with those of the Partnership.
(b) Woodfield
The Partnership owns an 80% general partnership interest in an
existing joint venture whose sole investment is an office building in
Schaumburg, Illinois. The venture agreement, as amended, provides that the
Partnership has a cumulative annual preference in the distribution of net
cash receipts (as defined) of $546,000. The next $136,500 of annual net
cash receipts is to be distributed to the venture partners; any remaining
net cash receipts are to be distributed 80% to the Partnership and 20% to
the venture partners. As of December 31, 1995, cumulative preference
payments to the Partnership are in arrears in the amount of $5,232,500.
Operating deficits are scheduled to be funded 80% by the Partnership
and 20% by the joint venture partner. The Partnership and the joint
venture partner have executed an amendment to the venture agreement which
specifies that each partner make contributions to the venture in their
respective partnership interests to fund the venture's operating deficits
and provides for the repayment of such contributions (as defined) prior to
the distributions of the cumulative annual preferences of net cash
receipts. Operating profits and losses are allocated 80% to the
Partnership and 20% to the joint venture partner.
An affiliate of the developer manages the property pursuant to a long-
term agreement which provides for a management fee of approximately $66,400
for 1995, subject to annual increases based upon a formula relating to the
Consumer Price Index.
(c) Westdale
The Partnership owns, through a joint venture partnership with the
seller, an interest in Westdale Mall shopping center. The venture
agreement provides that the first $1,267,500 of net cash receipts shall be
distributed 64.7% to the Partnership and 35.3% to the venture partner; all
remaining annual net cash receipts are to be distributed 45.5% to the
Partnership, 24.8% to the venture partner and 29.7% to the ground lessor as
additional rent. The Partnership has a preferred position (related to the
Partnership's cash investment in the venture) with respect to distributions
of sale or refinancing proceeds from the venture, after payment to the
ground lessor of the amounts described in note 6(b). As required by the
venture agreement, any deficit from operations is to be funded 45.5% by the
Partnership and 54.5% by the venture partner.
Venture operating profits and losses are allocated 64.7% to the
Partnership and 35.3% to the venture partner.
Effective August 1, 1994, the venture partner transferred its interest
in Westdale Mall to another company affiliated with the venture partner's
parent company. The property is managed by the new venture partner
pursuant to an assignment of the previous agreement which provides for a
management fee equal to a portion of the tenants' contributions toward
operating costs plus the lesser of $120,000 per year or 3% of the minimum
rent received from tenants.
(4) LONG-TERM DEBT
(a) Long-term debt consists of the following at December 31, 1995 and
1994:
1995 1994
----------- -----------
8.25% (9.875% prior to
September 1, 1995)
mortgage note, secured
by an office building in
Schaumburg, Illinois; balance
payable in monthly installments
(interest only) of $84,774
from September 1, 1995
through maturity on Septem-
ber 1, 1998; (note 4(b)). . . . . . . $12,330,749 12,330,749
8-3/4% - 10-3/8% mortgage notes,
due at various dates from
March 1, 2010 to July 1, 2015;
secured by a leasehold and
shopping center in Cedar Rapids,
Iowa; payable in monthly
installments aggregating
$234,841 (including interest).
Balances are net of $4,623,569
in 1995 and $4,839,331 in 1994
of unamortized discounts based
on imputed interest rates of 12% . . . 21,059,132 21,331,562
----------- ----------
Total debt . . . . . . . . . . . . 33,389,881 33,662,311
Less current portion
of long-term debt . . . . . . . . 306,980 12,603,179
----------- ----------
Total long-term debt . . . . . . . $33,082,901 21,059,132
=========== ==========
Five-year maturities of long-term debt (net of unamortized discounts)
are summarized as follows:
1996. . . . . . . . . . . $ 306,980
1997. . . . . . . . . . . 345,913
1998. . . . . . . . . . . 12,720,532
1999. . . . . . . . . . . 439,217
2000. . . . . . . . . . . 494,921
===========
(b) Debt Modifications
Due to continued operating deficits at the property, the mortgage note
secured by the One Woodfield Lake office building located in Schaumburg,
Illinois was modified in April 1990, October 1991 and July 1992.
The long-term mortgage loan secured by the property matured on
September 1, 1995. The joint venture signed an extension of the maturity
date of the mortgage loan until September 1, 1998 and a reduction in the
interest rate. Though the monthly mortgage loan payments decline as a
result of this agreement, any excess cash flow, as defined, must be
escrowed at the property for future deficits and capital improvements. The
joint venture is current in its payments to the mortgage lender under the
agreement as of the date of this report. As the leases of existing tenants
expire, there will likely be a negative impact on cash flow due to the
downward pressure on net effective market rental rates. Should the
property not produce sufficient cash flow to service its indebtedness, the
joint venture may decide not to commit any significant additional amounts
of capital to this property due to the fact that recovery of such amounts
is uncertain. Although the property currently produces sufficient cash
flow to fund the mortgage loan, upon any significant decline in future
operating cash flow and if the joint venture decides not to commit
additional funds to the property, the mortgage lender would likely realize
on its security and the joint venture would no longer have an ownership
interest in the property. In such event, the joint venture would recognize
a gain for financial reporting and Federal income tax purposes without any
net realizable proceeds.
(5) PARTNERSHIP AGREEMENT
Pursuant to the terms of the Partnership Agreement, net profits or
losses of the Partnership from operations are allocated 96% to the Limited
Partners and 4% to the General Partners. Profits from the sale or
refinancing of investment properties are to be allocated to the General
Partners to the greater of 1% of such profits or the amount of cash
distributable to the General Partners from any such sale or refinancing (as
described below). Losses from the sale or refinancing of investment
properties are to be allocated 1% to the General Partners. The remaining
sale or refinancing profits and losses will be allocated to the Limited
Partners.
An amendment to the Partnership Agreement, effective January 1, 1991,
generally provides that notwithstanding any allocation contained in the
Agreement, if at any time profits are realized by the Partnership, any
current or anticipated event that would cause the deficit balance in
absolute amount in the Capital Account of the General Partners to be
greater than their share of the Partnership's indebtedness (as defined)
after such event, then the allocation of Profits to the General Partners
shall be increased to the extent necessary to cause the deficit balance in
the Capital Account of the General Partners to be no less than their
respective shares of the Partnership's indebtedness after such event. In
general, the effect of this amendment is to allow the deferral of the
recognition of taxable gain to the Limited Partners.
The General Partners are not required to make any capital contribu-
tions except under certain limited circumstances upon termination of the
Partnership. Distributions of "cash flow" of the Partnership are allocated
90% to the Limited Partners and 10% to the General Partners. However,
portions of such distributions to the General Partners are subordinated to
the Limited Partners' receipt of a stipulated return on capital.
The Partnership Agreement provides that the General Partners shall
receive as a distribution from the sale of a real property by the
Partnership an amount equal to 3% of the selling price, and that the
remaining proceeds (net after expenses and retained working capital) be
distributed 85% to the Limited Partners and 15% to the General Partners.
However, the Limited Partners shall receive 100% of such net sale proceeds
until the Limited Partners (i) have received cash distributions of sale or
refinancing proceeds in an amount equal to the Limited Partners' aggregate
initial capital investment in the Partnership and (ii) have received
cumulative cash distributions from the Partnership's operations which, when
combined with sale or refinancing proceeds previously distributed, equal a
6% annual return on the Limited Partners' average capital investment for
each year (their initial capital investment as reduced by sale or
refinancing proceeds previously distributed) commencing with the fourth
fiscal quarter of 1980. Two-thirds of the 3% General Partner distribution
discussed above is further subordinated to the Limited Partners receiving
out of sales proceeds an amount equal to 110% of their initial capital
investment in the Partnership. The Limited Partners have received cash
distributions that satisfied the requirements in (i) and (ii) above. Also,
the Limited Partners have received an amount equal to 110% of their initial
capital investment with the August 1993 cash distribution. Therefore,
approximately $4,500,000 of sales proceeds have been distributed to the
General Partners pursuant to the distribution levels described above.
(6) LEASES
(a) As Property Lessor
At December 31, 1995, the Partnership's and its consolidated ventures'
principal assets consist of one shopping center and one office building.
The Partnership has determined that all leases relating to these properties
are properly classified as operating leases; therefore rental income is
reported when earned and the cost of the properties, excluding the cost of
the land, is depreciated over the estimated useful lives. Leases with
tenants range in term from one to twenty-seven years and provide for fixed
minimum rent and partial reimbursement of operating costs. In addition,
leases with shopping center tenants provide for additional rent based upon
percentages of tenants' sales volume. With respect to the Partnership's
shopping center investment, a substantial portion of the ability of retail
tenants to honor their leases is dependent upon the retail economic sector.
Cost and accumulated depreciation of the leased assets are summarized
as follows at December 31, 1995:
Office Building:
Cost . . . . . . . . . . . . . . $ 18,895,680
Accumulated depreciation . . . . 12,446,041
------------
6,449,639
------------
Shopping Center:
Cost . . . . . . . . . . . . . . 41,718,586
Accumulated depreciation . . . . 25,709,728
------------
16,008,858
------------
$ 22,458,497
============
Minimum lease payments, including amounts representing executory costs
(e.g. taxes, maintenance, insurance) and any related profit, to be received
in the future under the operating leases are as follows:
1996. . . . . . . . . . . . . . . . $ 7,573,348
1997. . . . . . . . . . . . . . . . 6,949,670
1998. . . . . . . . . . . . . . . . 6,430,718
1999. . . . . . . . . . . . . . . . 5,917,614
2000. . . . . . . . . . . . . . . . 4,428,105
Thereafter. . . . . . . . . . . . . 13,978,001
-----------
Total. . . . . . . . . . . . $45,277,456
===========
Contingent rent (based on sales by property tenants) included in con-
solidated rental income was as follows for the years ended December 31,
1995, 1994 and 1993:
1993. . . . . . . . . . . . . . . . $510,122
1994. . . . . . . . . . . . . . . . 578,166
1995. . . . . . . . . . . . . . . . 656,128
========
(b) As Property Lessee
The following lease agreement has been determined to be an operating
lease.
The Westdale venture leases the land underlying the Cedar Rapids, Iowa
shopping center from the Partnership's Westdale new venture partner.
Reference is to note 3(c). The lease has a remaining term of approximately
43 years with options to extend the lease for two additional ten-year
periods. The lease requires the venture to pay all costs and expenses of
the property, including maintenance, insurance and real estate taxes. The
lease provides for annual base rent of $848,900 plus additional rent based
upon gross income from certain tenants and annual cash flow in excess of
specified levels as described in note 3(c). The lease further provides
that upon sale of the Westdale Mall shopping center the Westdale venture
may require the lessor to convey a portion of the leased land to the
purchaser as part of the sale. As consideration for such conveyance, the
lessor is entitled to receive the first $5,872,000 of net sales proceeds
plus 29.7% of any net sales proceeds in excess of $19,784,000.
Total rental expense for the years ended December 31, 1995, 1994 and
1993 under the above operating leases was $1,071,906, $1,096,231 and
$1,217,071, respectively, and consisted substantially of minimum rent.
Future minimum rental commitments under the above operating lease are
as follows:
1996. . . . . . . . . . . . . . . . $ 848,900
1997. . . . . . . . . . . . . . . . 848,900
1998. . . . . . . . . . . . . . . . 848,900
1999. . . . . . . . . . . . . . . . 848,900
2000. . . . . . . . . . . . . . . . 848,900
Thereafter. . . . . . . . . . . . . 32,258,200
-----------
Total. . . . . . . . . . . . . $36,502,700
===========
(7) TRANSACTIONS WITH AFFILIATES
The Partnership, pursuant to the Partnership Agreement, is permitted
to engage in various transactions involving the Managing General Partner
and its affiliates including the reimbursement for salaries and salary-
related expenses of its employees, certain of its officers, and other
direct expenses relating to the administration of the Partnership and the
operation of the Partnership's investments. Fees, commissions and other
expenses required to be paid by the Partnership to the General Partners and
their affiliates as of December 31, 1995, 1994 and 1993 are as follows:
<TABLE>
<CAPTION>
UNPAID AT
DECEMBER 31,
1995 1994 1993 1995
------- ------- -------- --------------
<S> <C> <C> <C> <C>
Reimbursement (at cost) for
accounting services . . . . . . . . . . $ -- -- 5,333 --
Reimbursement (at cost) for
administrative charges and
other out-of-pocket expenses. . . . . . 10,481 3,429 8,370 --
------- ------ -------- ------
$10,481 3,429 13,703 --
======= ====== ======== ======
<FN>
Effective October 1, 1995, the Managing General Partner of the Partnership engaged independent third parties
to perform certain administrative services for the Partnership which were previously performed by affiliates of
the General Partners.
(8) SUBSEQUENT EVENT - DISTRIBUTIONS
In February 1996, the Partnership paid a distribution of $121,010 ($2 per Interest) to the Limited Partners
and $13,446 to the General Partners.
</TABLE>
<TABLE>
SCHEDULE III
JMB INCOME PROPERTIES, LTD. - VII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
CONSOLIDATED REAL ESTATE AND ACCUMULATED DEPRECIATION
DECEMBER 31, 1995
<CAPTION>
COSTS
CAPITALIZED
INITIAL COST TO SUBSEQUENT GROSS AMOUNT AT WHICH CARRIED
PARTNERSHIP (A) TO ACQUISITION AT CLOSE OF PERIOD (B)
------------------------- -------------- ------------------------------------
LAND AND BUILDINGS BUILDINGS BUILDINGS
LEASEHOLD AND AND AND
ENCUMBRANCE INTEREST IMPROVEMENTS IMPROVEMENTS LAND IMPROVEMENTS TOTAL (D)
----------- ----------- ------------ --------------- ---------- ------------ -----------
<S> <C> <C> <C> <C> <C> <C> <C>
SHOPPING CENTERS:
Cedar Rapids,
Iowa (C) . . $21,059,132 -- 35,020,531 6,698,055 (F) 41,718,586 41,718,586
OFFICE BUILDING:
Schaumburg,
Illinois
(C). . . . . 12,330,749 1,394,540 15,543,480 1,957,660 1,394,540 17,501,140 18,895,680
----------- --------- ---------- ---------- --------- ---------- ----------
Total . . $33,389,881 1,394,540 50,564,011 8,655,715 1,394,540 59,219,726 60,614,266
=========== ========= ========== ========== ========= ========== ==========
</TABLE>
<TABLE>
SCHEDULE III
JMB INCOME PROPERTIES, LTD. - VII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
CONSOLIDATED REAL ESTATE AND ACCUMULATED DEPRECIATION - CONTINUED
<CAPTION>
LIFE ON WHICH
DEPRECIATION
IN LATEST
STATEMENT OF 1995
ACCUMULATED DATE OF DATE OPERATIONS REAL ESTATE
DEPRECIATION(E) CONSTRUCTION ACQUIRED IS COMPUTED TAXES
---------------- ------------ ---------- --------------- -----------
<S> <C> <C> <C> <C> <C>
SHOPPING CENTERS:
Cedar Rapids,
Iowa (C) . . . . . . . . . . . . . . $25,709,728 1980 09/19/80 5-35 years 1,058,890
OFFICE BUILDING:
Schaumburg,
Illinois
(C). . . . . . . . . . . . . . . . . 12,446,041 1980 06/04/80 5-35 years 1,026,603
----------- ---------
Total . . . . . . . . . . . . . . $38,155,769 2,085,493
=========== =========
<FN>
- ------------------
Notes:
(A) The initial cost to the Partnership represents the original purchase price of the
properties, including amounts incurred subsequent to acquisition which were contemplated at the
time the property was acquired.
(B) The aggregate cost of real estate owned at December 31, 1995 for Federal income tax
purposes was $55,700,546.
(C) The properties are owned and operated by joint ventures; see Note 3.
</TABLE>
<TABLE>
SCHEDULE III
JMB INCOME PROPERTIES, LTD. - VII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
CONSOLIDATED REAL ESTATE AND ACCUMULATED DEPRECIATION - CONTINUED
(D) Reconciliation of real estate owned:
<CAPTION>
1995 1994 1993
------------ ------------ ------------
<S> <C> <C> <C>
Balance at beginning of period. . . . . $ 60,495,985 59,865,786 57,575,019
Additions during period . . . . . . . . 118,281 630,199 2,290,767
------------ ------------ ------------
Balance at end of period. . . . . . . . $ 60,614,266 60,495,985 59,865,786
============ ============ ============
(E) Reconciliation of accumulated depreciation:
Balance at beginning of period. . . . . $ 35,834,904 33,521,163 31,244,534
Depreciation expense. . . . . . . . . . 2,320,865 2,313,741 2,276,629
------------ ------------ ------------
Balance at end of period. . . . . . . . $ 38,155,769 35,834,904 33,521,163
============ ============ ============
<FN>
(F) Property operated under ground lease; see Note 6(b).
</TABLE>
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE
There were no changes of or disagreements with accountants during
fiscal years 1994 and 1995.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE PARTNERSHIP
The Managing General Partner of the Partnership is JMB Realty
Corporation ("JMB"), a Delaware corporation, substantially all of the
outstanding stock of which is owned directly or indirectly, by certain of
its officers and directors and members of their families. JMB has
responsibility for all aspects of the Partnership's operations, subject to
the requirement that sales of real property must be approved by the
Associate General Partner of the Partnership, AGPP Associates, L.P.
Effective December 31, 1995, AGPP Associates, L.P. acquired the general
partnership interest in the Partnership of the Associate General Partner,
Income Associates VII, L.P., (which constituted substantially all of the
assets of Income Associates VII, L.P.). AGPP Associates, L.P., an Illinois
limited partnership with JMB as the sole general partner, continues as the
Associate General Partner. The Associate General Partner shall be directed
by a majority in interest of its limited partners (who are generally
officers, directors and affiliates of JMB or its affiliates) as to whether
to provide its approval of any sale of real property (or any interest
therein) of the Partnership. The Partnership is subject to certain
conflicts of interest arising out of its relationships with the General
Partners and their affiliates as well as the fact that the General Partners
and their affiliates are engaged in a range of real estate activities.
Certain services have been and may in the future be provided to the
Partnership or its investment properties by affiliates of the General
Partners, including property management services and insurance brokerage
services. In general, such services are to be provided on terms no less
favorable to the Partnership than could be obtained from independent third
parties and are otherwise subject to conditions and restrictions contained
in the Partnership Agreement. The Partnership Agreement permits the
General Partners and their affiliates to provide services to, and otherwise
deal and do business with, persons who may be engaged in transactions with
the Partnership, and permits the Partnership to borrow from, purchase goods
and services from, and otherwise to do business with, persons doing
business with the General Partners or their affiliates. The General
Partners and their affiliates may be in competition with the Partnership
under certain circumstances, including, in certain geographical markets,
for tenants for properties and/or for the sale of properties. Because the
timing and amount of cash distributions and profits and losses of the
Partnership may be affected by various determinations by the General
Partners under the Partnership Agreement, including whether and when to
sell or refinance a property, the establishment and maintenance of
reasonable reserves, the timing of expenditures and the allocation of
certain tax items under the Partnership Agreement, the General Partners may
have a conflict of interest with respect to such determinations.
The names, positions held and length of service therein of each
director and the executive and certain other officers of the Managing
General Partner are as follows:
SERVED IN
NAME OFFICE OFFICE SINCE
- ---- ------ ------------
Judd D. Malkin Chairman 5/03/71
Director 5/03/71
Chief Financial Officer 2/22/96
Neil G. Bluhm President 5/03/71
Director 5/03/71
Burton E. Glazov Director 7/01/71
Stuart C. Nathan Executive Vice President 5/08/79
Director 3/14/73
A. Lee Sacks Director 5/09/88
John G. Schreiber Director 3/14/73
H. Rigel Barber Executive Vice President 1/02/87
Chief Executive Officer 8/01/93
Glenn E. Emig Executive Vice President 1/01/93
Chief Operating Officer 1/01/95
Gary Nickele Executive Vice President and 1/01/92
General Counsel 2/27/84
Gailen J. Hull Senior Vice President 6/01/88
Howard Kogen Senior Vice President 1/02/86
Treasurer 1/01/91
There is no family relationship among any of the foregoing directors
or officers. The foregoing directors have been elected to serve a one-year
term until the annual meeting of the Managing General Partner to be held on
June 5, 1996. All of the foregoing officers have been elected to serve
one-year terms until the first meeting of the Board of Directors held after
the annual meeting of the Managing General Partner to be held on June 5,
1996. There are no arrangements or understandings between or among any of
said directors or officers and any other person pursuant to which any
director or officer was elected as such.
JMB is the corporate general partner of Carlyle Real Estate Limited
Partnership-VII ("Carlyle-VII"), Carlyle Real Estate Limited Partnership-IX
("Carlyle-IX"), Carlyle Real Estate Limited Partnership-X ("Carlyle-X"),
Carlyle Real Estate Limited Partnership-XI ("Carlyle-XI"), Carlyle Real
Estate Limited Partnership-XII ("Carlyle-XII"), Carlyle Real Estate Limited
Partnership-XIII ("Carlyle-XIII"), Carlyle Real Estate Limited
Partnership-XIV ("Carlyle-XIV"), Carlyle Real Estate Limited Partnership-XV
("Carlyle-XV"), Carlyle Real Estate Limited Partnership-XVI ("Carlyle-
XVI"), Carlyle Real Estate Limited Partnership-XVII ("Carlyle-XVII"), JMB
Mortgage Partners, Ltd. ("Mortgage Partners"), JMB Mortgage Partners,
Ltd.-II ("Mortgage Partners-II"), JMB Mortgage Partners, Ltd.-III
("Mortgage Partners-III"), JMB Mortgage Partners, Ltd.-IV ("Mortgage
Partners-IV"), Carlyle Income Plus, Ltd. ("Carlyle Income Plus") and
Carlyle Income Plus, Ltd.-II ("Carlyle Income Plus-II") and the managing
general partner of JMB Income Properties, Ltd.-IV ("JMB Income-IV"), JMB
Income Properties, Ltd.-V ("JMB Income-V"), JMB Income Properties, Ltd.-VI
("JMB Income-VI"), JMB Income Properties, Ltd.-IX ("JMB Income-IX"), JMB
Income Properties, Ltd.-X ("JMB Income-X"), JMB Income Properties, Ltd.-XI
("JMB Income-XI"), JMB Income Properties, Ltd.-XII ("JMB Income-XII"), and
JMB Income Properties Ltd.-XIII ("JMB Income-XIII"). JMB is also the sole
general partner of the associate general partner of most of the foregoing
partnerships. Most of the foregoing directors and officers are also
officers and/or directors of various affiliated companies of JMB including
Arvida/JMB Managers, Inc. (the general partner of Arvida/JMB Partners, L.P.
("Arvida")), Arvida/JMB Managers-II, Inc. (the general partner of
Arvida/JMB Partners, L.P.-II ("Arvida-II") and Income Growth Managers, Inc.
(the corporate general partner of IDS/JMB Balanced Income Growth, Ltd.
("IDS/BIG")). Most of such directors and officers are also partners of
certain partnerships which are associate general partners in the following
real estate limited partnerships: Carlyle-VII, Carlyle-IX, Carlyle-X,
Carlyle-XI, Carlyle-XII, Carlyle-XIII, Carlyle-XIV, Carlyle-XV,
Carlyle-XVI, Carlyle-XVII, JMB Income-VI, JMB Income-IX, JMB Income-X, JMB
Income-XI, JMB Income-XII, JMB Income-XIII, Mortgage Partners, Mortgage
Partners-II, Mortgage Partners-III, Mortgage Partners-IV, Carlyle Income
Plus, Carlyle Income Plus-II and IDS/BIG.
The business experience during the past five years of each such
director and officer of the Managing General Partner of the Partnership in
addition to that described above is as follows:
Judd D. Malkin (age 58) is an individual general partner of JMB
Income-IV and JMB Income-V. Mr. Malkin has been associated with JMB since
October 1969. Mr. Malkin is a director of Urban Shopping Centers, Inc., an
affiliate of JMB that is a real estate investment trust in the business of
owning, managing and developing shopping centers. He is a Certified Public
Accountant.
Neil G. Bluhm (age 58) is an individual general partner of JMB
Income-IV and JMB Income-V. Mr. Bluhm has been associated with JMB since
August 1970. Mr. Bluhm is a director of Urban Shopping Centers, Inc., an
affiliate of JMB that is a real estate investment trust in the business of
owning, managing and developing shopping centers. He is a member of the
Bar of the State of Illinois and a Certified Public Accountant.
Burton E. Glazov (age 57) has been associated with JMB since June 1971
and served as an Executive Vice President of JMB until December of 1990.
He is a member of the Bar of the State of Illinois and a Certified Public
Accountant.
Stuart C. Nathan (age 54) has been associated with JMB since July
1972. Mr. Nathan is also a director of Sportmart Inc., a retailer of
sporting goods. He is a member of the Bar of the State of Illinois.
A. Lee Sacks (age 62) (President and Director of JMB Insurance Agency,
Inc.) has been associated with JMB since December 1972.
John G. Schreiber (age 49) has been associated with JMB since December
1970 and served as an Executive Vice President of JMB until December 1990.
Mr. Schreiber is a director of Urban Shopping Centers, Inc., an affiliate
of JMB that is a real estate investment trust in the business of owning,
managing and developing shopping centers. He is also a director of a
number of investment companies advised or managed by T. Rowe Price
Associates and its affiliates. Mr. Schreiber is President of Schreiber
Investments, Inc., a company which is engaged in the real estate investing
business. He is also a senior advisor and partner of Blackstone Real
Estate Partners, an affiliate of the Blackstone Group, L.P. Since 1994,
Mr. Schreiber has also served as a Trustee of Amli Residential Property
Trust, a publicly-traded real estate investment trust that invests in
multi-family properties. He holds a Masters degree in Business
Administration from Harvard University Graduate School of Business.
H. Rigel Barber (age 46) has been associated with JMB since March
1982. He holds a J.D. degree from the Northwestern Law School and is a
member of the Bar of the State of Illinois.
Glenn E. Emig (age 48) has been associated with JMB since December,
1979. Prior to becoming Executive Vice President of JMB in 1993, Mr. Emig
was Executive Vice President and Treasurer of JMB Institutional Realty
Corporation. He holds a Masters degree in Business Administration from the
Harvard University Graduate School of Business and is a Certified Public
Accountant.
Gary Nickele (age 43) has been associated with JMB since February,
1984. He holds a J.D. degree from the University of Michigan Law School
and is a member of the Bar of the State of Illinois.
Gailen J. Hull (age 47) has been associated with JMB since March,
1982. He holds a Masters degree in Business Administration from Northern
Illinois University and is a Certified Public Accountant.
Howard Kogen (age 60) has been associated with JMB since March, 1973.
He is a Certified Public Accountant.
ITEM 11. EXECUTIVE COMPENSATION
The Partnership has no officers or directors. The General Partners of
the Partnership are entitled to receive a share of cash distributions, when
and as cash distributions are made to the Limited Partners, and a share of
profits or losses. Reference is also made to Notes 5 and 7 for a
description of such transactions, distributions and allocations. In 1995,
1994 and 1993 cash distributions of $53,782, $53,782 and $2,710,036 were
paid, respectively, to the General Partners.
The General Partners of the Partnership may be reimbursed for their
direct expenses relating to the administration of the Partnership and the
operation of the Partnership's real property investments. In 1995, the
Managing General Partner was due reimbursement for such out-of-pocket
expenses in the amount of $10,481, all of which was paid as of December 31,
1995.
The Partnership is permitted to engage in various transactions
involving affiliates of the Managing General Partner of the Partnership and
its affiliates. The relationship of the Managing General Partner (and its
directors and officers) to its affiliates is set forth in Item 10 above and
Exhibit 21 hereto.
<TABLE>
<CAPTION>
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
(a) No person or group is known by the Partnership to own beneficially more than 5% of the outstanding
Interests of the Partnership.
(b) The Managing General Partner, its officers and directors and the Associate General Partner own the
following Interests of the Partnership:
NAME OF AMOUNT AND NATURE
BENEFICIAL OF BENEFICIAL PERCENT
TITLE OF CLASS OWNER OWNERSHIP OF CLASS
- -------------- ---------- ----------------- --------
<S> <C> <C> <C>
Limited Partnership
Interests JMB Realty Corporation 99 Interests Less than 1%
directly
Limited Partnership
Interests Managing General Partner, 99 Interests Less than 1%
its officers and directly
directors and the Associate
General Partner as a group
<FN>
No officer or director of the Managing General Partner of the Partnership possesses a right to acquire
beneficial ownership of Interests of the Partnership.
(c) There exists no arrangement, known to the Partnership, the operation of which may at a subsequent date
result in a change in control of the Partnership.
</TABLE>
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
There were no significant transactions or business relationships with
the Managing General Partner, affiliates or their management other than
those described in Items 10 and 11 above.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
(a) The following documents are filed as part of this report:
(1) Financial Statements (See Index to Financial Statements
filed with this report).
(2) Exhibits.
3-A.* The Prospectus of the Partnership dated January
18, 1980, as supplemented May 23, 1980, as filed with the Commission
pursuant to Rules 424(b) and 424(c), is hereby incorporated herein by
reference. Pages 8-15, 92-94, and A-6 to A-17 of the Prospectus are
incorporated herein by reference.
3-B.* Amended and Restated Agreement of Limited
Partnership set forth as Exhibit A to the Prospectus, which is hereby
incorporated herein by reference.
4-A. Mortgage loan agreement relating to the purchase
by the Partnership of an interest in the One Woodfield Lake Office Building
in Schaumburg, Illinois is hereby incorporated by reference to the
Partnership's Report on Form 8-K File No. 0-9555 dated June 17, 1980.
4-B. Mortgage loan agreement relating to the purchase
by the Partnership of an interest in Westdale Mall in Cedar Rapids, Iowa is
hereby incorporated by reference to the Partnership's Report on Form 8-K
File No. 0-9555 dated October 3, 1980.
4-C. Mortgage loan modification and extension
agreement concerning the mortgage loan secured by the One Woodfield Lake
Office Building in Schaumburg, Illinois dated May 1, 1995 is filed
herewith.
10-A. Acquisition documents including the venture
agreement relating to the purchase by the Partnership of an interest in the
One Woodfield Lake Office Building in Schaumburg, Illinois are hereby
incorporated by reference to the Partnership's Report on Form 8-K File No.
0-9555 dated June 17, 1980.
10-B. Acquisition documents including the venture
agreement relating to the purchase by the Partnership of an interest in
Westdale Mall in Cedar Rapids, Iowa are hereby incorporated by reference to
the Partnership's Report on Form 8-K File No. 0-9555 dated October 3, 1980.
21. List of Subsidiaries.
24. Power of Attorney
27. Financial Data Schedule
----------------
* Previously filed as Exhibits 3-A and 3-B to the
Partnership's Report for December 31, 1992 on Form 10-K (File No. 0-9555)
and hereby incorporated herein by reference.
(b) No reports on Form 8-K were filed since the beginning of the
last quarter of the period covered by this report
No annual report for the fiscal year 1995 or proxy material has been
sent to the Partners of the Partnership. An annual report will be sent to
the Partners subsequent to this filing.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Act of 1934, the Partnership has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
JMB INCOME PROPERTIES, LTD. - VII
By: JMB Realty Corporation
Managing General Partner
GAILEN J. HULL
By: Gailen J. Hull
Senior Vice President
Date: March 25, 1996
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
By: JMB Realty Corporation
Managing General Partner
JUDD D. MALKIN*
By: Judd D. Malkin, Chairman and
Chief Financial Officer
Date: March 25, 1996
NEIL G. BLUHM*
By: Neil G. Bluhm, President and Director
Date: March 25, 1996
H. RIGEL BARBER*
By: H. Rigel Barber, Chief Executive Officer
Date: March 25, 1996
GLENN E. EMIG*
By: Glenn E. Emig, Chief Operating Officer
Date: March 25, 1996
GAILEN J. HULL
By: Gailen J. Hull, Senior Vice President
Principal Accounting Officer
Date: March 25, 1996
A. LEE SACKS*
By: A. Lee Sacks, Director
Date: March 25, 1996
By: STUART C. NATHAN*
Stuart C. Nathan, Executive Vice President
and Director
Date: March 25, 1996
*By: GAILEN J. HULL, Pursuant to a Power of Attorney
GAILEN J. HULL
By: Gailen J. Hull, Attorney-in-Fact
Date: March 25, 1996
JMB INCOME PROPERTIES, LTD. - VII
EXHIBIT INDEX
DOCUMENT
INCORPORATED
BY REFERENCE PAGE
------------- ----
3-A. Pages 8-15, 92-94 and A-6
to A-17 of the Prospectus
of the Partnership dated
January 18, 1980 Yes
3-B. Amended and Restated Agreement
of Limited Partnership Yes
4-A. Mortgage loan agreement
relating to One Woodfield Lake
Office Building Yes
4-B. Mortgage loan agreement
relating to Westdale Mall Yes
4-C. Mortgage loan modification
and no extension agreement
relating to the One Woodfield
Lake Office Building No
10-A. Acquisition documents
related to One Woodfield
Lake Office Building Yes
10-B. Acquisition documents
related to the Westdale Mall Yes
10-C. Sale documents related
to the Clackamas Town Center Yes
10-D. Sale documents related to
the Oklahoma Distribution Center Yes
21. List of Subsidiaries No
24. Power of Attorney No
27. Financial Data Schedule No
EXHIBIT 21
LIST OF SUBSIDIARIES
The Partnership is a general partner in One Woodfield Lake, an
Illinois limited partnership which holds title to the One Woodfield Lake
office building. The Partnership is a general partner in Westdale
Associates, an Illinois general partnership which holds title to the
Westdale Mall Shopping Center. The Partnership is a general partner in
Properties Partners, an Illinois general partnership which owns a 58.16%
undivided interest in certain assets relating to the Clackamas Town Center
Shopping Center. The Partnership's share of Properties Partners is 72.73%.
Reference is made to Note 3 of the Notes to Consolidated Financial
Statements filed with this annual report for a summary description of the
terms of such partnership agreements. The Partnership's interest in the
foregoing joint venture partnerships, and the results of their operations
are included in the consolidated financial statements of the Partnership
filed with this annual report.
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned officers of JMB
Realty Corporation, the managing general partner of JMB INCOME PROPERTIES,
LTD. - VII, do hereby nominate, constitute and appoint GARY NICKELE, GAILEN
J. HULL, DENNIS M. QUINN or any of them, attorneys and agents of the
undersigned with full power of authority to sign in the name and on behalf
of the undersigned officers a Report on Form 10-K of said partnership for
the fiscal year ended December 31, 1995, and any and all amendments
thereto, hereby ratifying and confirming all that said attorneys and agents
and any of them may do by virtue hereof.
IN WITNESS WHEREOF, the undersigned have executed this Power of
Attorney the 5th day of February, 1996.
H. RIGEL BARBER
- -----------------------
H. Rigel Barber Chief Executive Officer
GLENN E. EMIG
- -----------------------
Glenn E. Emig Chief Operating Officer
The undersigned hereby acknowledge and accept such power of authority
to sign, in the name and on behalf of the above named officers, a Report on
Form 10-K of said partnership for the fiscal year ended December 31, 1995,
and any and all amendments thereto, the 5th day of February, 1996.
GARY NICKELE
-----------------------
Gary Nickele
GAILEN J. HULL
-----------------------
Gailen J. Hull
DENNIS M. QUINN
-----------------------
Dennis M. Quinn
<PAGE>
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned officers of JMB
Realty Corporation, the managing general partner of JMB INCOME PROPERTIES,
LTD. - VII, do hereby nominate, constitute and appoint GARY NICKELE, GAILEN
J. HULL, DENNIS M. QUINN or any of them, attorneys and agents of the
undersigned with full power of authority to sign in the name and on behalf
of the undersigned officers a Report on Form 10-K of said partnership for
the fiscal year ended December 31, 1995, and any and all amendments
thereto, hereby ratifying and confirming all that said attorneys and agents
and any of them may do by virtue hereof.
IN WITNESS WHEREOF, the undersigned have executed this Power of
Attorney the 5th day of February, 1996.
NEIL G. BLUHM
- ----------------------- President and Director
Neil G. Bluhm
JUDD D. MALKIN
- ----------------------- Chairman and Chief Financial Officer
Judd D. Malkin
A. LEE SACKS
- ----------------------- Director of General Partner
A. Lee Sacks
STUART C. NATHAN
- ----------------------- Executive Vice President
Stuart C. Nathan Director of General Partner
A. Lee Sacks
The undersigned hereby acknowledge and accept such power of authority
to sign, in the name and on behalf of the above named officers, a Report on
Form 10-K of said partnership for the fiscal year ended December 31, 1995,
and any and all amendments thereto, the 5th day of February, 1996.
GARY NICKELE
-----------------------
Gary Nickele
GAILEN J. HULL
-----------------------
Gailen J. Hull
DENNIS M. QUINN
-----------------------
Dennis M. Quinn
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
REGISTRANT'S FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 1995 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS
INCLUDED IN SUCH REPORT.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> DEC-31-1995
<CASH> 6,182,420
<SECURITIES> 0
<RECEIVABLES> 1,663,883
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 7,846,303
<PP&E> 60,614,266
<DEPRECIATION> 38,155,769
<TOTAL-ASSETS> 35,848,308
<CURRENT-LIABILITIES> 3,749,114
<BONDS> 33,082,901
<COMMON> 0
0
0
<OTHER-SE> (2,837,769)
<TOTAL-LIABILITY-AND-EQUITY> 35,848,308
<SALES> 11,836,675
<TOTAL-REVENUES> 12,143,574
<CGS> 0
<TOTAL-COSTS> 8,667,673
<OTHER-EXPENSES> 169,043
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 3,710,008
<INCOME-PRETAX> (403,150)
<INCOME-TAX> 0
<INCOME-CONTINUING> (303,584)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (303,584)
<EPS-PRIMARY> (4.82)
<EPS-DILUTED> (4.82)
</TABLE>
EXHIBIT 4-C
THIRD NOTE AND MORTGAGE
MODIFICATION AGREEMENT
THIS AGREEMENT, made as of the 1st day of May, 1995, by and between
LaSALLE NATIONAL TRUST, N.A., as successor trustee to LaSalle National
Bank, a national banking association, not personally but as Trustee under
Trust Agreement dated October 24, 1978, and known as Trust No. 100104
(hereinafter referred to as the "Mortgagor") and JOHN HANCOCK MUTUAL LIFE
INSURANCE COMPANY, a Massachusetts corporation (hereinafter referred to as
"John Hancock").
W I T N E S S E T H:
A. Mortgagor is the maker of (i) a Promissory Note dated December
8, 1978, as amended by Amendment No. 1 to Promissory Note dated June 29,
1979, and by Note and Mortgage Modification Agreement dated as of April 1,
1990, and by Second Note and Mortgage Modification Agreement dated as of
March 1, 1991 (said Promissory Note, as so amended, is hereinafter referred
to as "the Note"), in the amount of $12,600,000.00 made payable to
CONTINENTAL ILLINOIS NATIONAL BANK AND TRUST COMPANY OF CHICAGO, a
national banking association (hereinafter referred to as "Continental"),
and (ii) a Construction and Permanent Mortgage and Security Agreement dated
December 8, 1978, and recorded in the Office of the Cook County Recorder of
Deeds on December 20, 1978 as Document No. 24772715 ("the Original
Mortgage"), said Original Mortgage having been supplemented and
amended by that certain First Supplement and Amendment to Construction and
Permanent Mortgage and Security Agreement dated June 29, 1979 and recorded
in the Office of the Cook County Recorder of Deeds on July 2, 1979 as
Document No. 25032238 ("the First Supplement"), by that certain Second
Supplement to Construction and Permanent Mortgage and Security Agreement
dated March 25, 1980 and recorded in the Office of the Cook County Recorder
of Deeds on April 8, 1980 as Document No. 25417700 ("the Second
Supplement"), by that certain Note and Mortgage Modification Agreement
dated as of April 1, 1990 and recorded in the Office of the Cook County
Recorder of Deeds on December 20, 1990 as Document No. 90617182 ("the First
Modification"), and by that certain Second Note and Mortgage Modification
Agreement dated as of March 1, 1991 and recorded in the Office of the Cook
County Recorder of Deeds on October 4, 1991 as Document No. 91519783 ("the
Second Modification"). The Original Mortgage, the First Supplement, the
Second Supplement, the First Modification and the Second Modification are
hereinafter collectively referred to as "the Mortgage." The Note evidences
indebtedness of Mortgagor in the original principal amount of TWELVE
MILLION SIX HUNDRED THOUSAND DOLLARS ($12,600,000.00) which indebtedness is
hereinafter sometimes referred to as the "Loan."
B. By Assignment of Mortgage and Assignment of Collateral Security
Documents dated April 7, 1980 and recorded in the Office of the Cook County
Recorder of Deeds on April 8, 1980 as Document No. 25417701, Continental
assigned to John Hancock all right, title
2
and interest of Continental in and to the Mortgage and the debt secured by
the Mortgage and evidenced by the Note, together with all of Continental's
right, title and interest in and to a certain Assignment of Rents dated
December 8, 1978 and recorded in the Office of the Cook County Recorder of
Deeds on December 20, 1978 as Document No. 24772716, as modified and
amended by First Supplement and Amendment to Assignment of Rents dated June
29, 1979 and recorder in the Office of the Cook County Recorder of Deeds on
July 2, 1979 as Document No. 25032239. The Note and the Mortgage, and the
foregoing described Assignment of Rents, as so amended and modified, are
presently owned and held by John Hancock. The Mortgage grants, mortgages
and conveys to John Hancock as security for the Loan the real property
described in EXHIBIT A attached hereto and made part hereof. John Hancock
is also the owner and holder of that certain Assignment of Leases dated
March 25, 1980 and recorded in the Office of the Cook County Recorder of
Deeds on April 8, 1980 as Document No. 25417702.
C. Mortgagor and John Hancock now mutually desire to modify and
amend certain provisions of the Note and the Mortgage all as hereinafter
set forth.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements hereinafter set forth and for other good and valuable
consideration, the receipt and sufficiency whereof are hereby acknowledged
by each of the parties hereto, Mortgagor and John Hancock agree as follows:
3
1. Effective as of the date hereof, the second full grammatical
paragraph of Section II of the Note (on page 4 thereof) is hereby amended
by deleting it in its entirety and by substituting in lieu thereof the
following:
"From and after the Transfer Date, if the undersigned shall by
such date have complied fully with the terms and provisions of the
permanent loan commitment issued by Hancock dated July 14, 1978, as the
same may have been or may hereafter be modified or amended, and with all
other conditions concerning said loan by the undersigned to be performed,
with all of which conditions the undersigned does specifically hereby
promise and agree to comply, interest shall accrue at the rate of nine and
seven-eighths per centum (9-7/8%) per annum from the Transfer Date through
August 31, 1995 and shall accrue thereafter at the rate of eight and one-
quarter per centum (8-1/4%) per annum and shall be paid, with principal, as
follows:
(a) INITIAL INTEREST PAYEMNT. Interest only on the
principal amount for the period commencing with the Transfer Date and
continuing through the month in which the Transfer Date occurs, shall be
paid in advance on the Transfer Date.
(b) MONTHLY PAYMENTS.
(i) Commencing on the first day of the next following
month (being June 1, 1980) and on the first day of each of the next one
hundred seventeen (117) months thereafter, until and including March 1,
1990, the undersigned shall pay to the order of Hancock principal and
interest in installments of ONE HUNDRED SEVEN THOUSAND NINE HUNDRED FORTY
DOLLARS ($107,940.00) each.
(ii) Beginning on April 1, 1990, and on the first day of
each of the next ten (10) months thereafter until and including February 1,
1991, the undersigned shall pay to the order of Hancock monthly
installments of interest only in the amount of NINETY-SIX THOUSAND SEVEN
HUNDRED FIFTY-FOUR and 98/100 DOLLARS ($96,754.98) each.
(iii)Beginning on March 1, 1991 and on the first day of
each of the next eleven (11)
4
months thereafter until and including February 1, 1992,
the undersigned shall pay to the order of Hancock monthly installments of
interest only in the amount of FORTY-EIGHT THOUSAND NINE HUNDRED EIGHTY-
NINE and 86/100 DOLLARS ($48,989.86) each. On February 1, 1992, the
accrued and unpaid interest (being the excess of the interest that has
accrued over the interest that has been paid as of such date) in the amount
of FIVE HUNDRED SEVENTY-THREE THOUSAND ONE HUNDRED EIGHTY-ONE and 44/100
DOLLARS ($573,181.44) for the period of February 1, 1991 through January
31, 1992 shall be added to, and become apart of, the principal amount of
the indebtedness evidenced by this Note, creating a principal balance in
the amount of TWELVE MILLION THREE HUNDRED THIRTY THOUSAND SEVEN HUNDRED
FORTY-NINE and 17/100 DOLLARS ($12,330,749.17). Prior to being added to
principal on February 1, 1992, such accrued and unpaid interest shall not
itself bear interest, but shall bear interest from, on and after such date.
(iv) Beginning March 1, 1992, and on the first day of
each of the next forty-two (42) months thereafter until and including
September 1, 1995, the undersigned shall pay to the order of Hancock
monthly installments of interest only in the amount of ONE HUNDRED ONE
THOUSAND FOUR HUNDRED SEVENTY-ONE and 79/100 DOLLARS ($101,471.79) each.
(v) Beginning October 1, 1995, and on the first day of
each of the next thirty-five (35) months thereafter until and including
September 1, 1998, the undersigned shall pay to the order of Hancock
monthly installments of interest only in the amount of EIGHTY-FOUR THOUSAND
SEVEN HUNDRED SEVENTY-THREE and 90/100 DOLLARS ($84,773.90) each, provided,
however, that the last of said payments on September 1, 1998 shall be in
the full amount of the balance of principal and interest then remaining
unpaid.
(C) SEVERABILITY. In the event the foregoing terms of
this Note, which provide for accrued and unpaid interest to be added to the
principal amount of the indebtedness evidenced by this Note, shall be held
invalid or unenforceable or contrary to law by a court of competent
jurisdiction, then all such
5
accrued and unpaid interest, in lieu of being added to
principal as aforesaid, shall immediately become due and payable, and
Hancock shall thereafter have the right to reallocate, first to interest
and the balance to a reduction in principal, the monthly installments which
are due and payable hereunder beginning March 1, 1992. The invalidity or
unenforceability of any such provision of this Note shall not affect the
remaining provisions of this Note or the provisions of the Construction and
Permanent Mortgage hereinafter described, such remaining provisions being
fully effective and enforceable to the extent permitted by law."
2. Effective as of the date hereof, the Note is hereby modified
and amended by adding to the first full grammatical paragraph on page 5
thereof providing for a prepayment premium, the following sentence at the
end of such paragraph: "No partial prepayment shall be permitted."
3. Effective as of the date hereof, the Mortgage is hereby
modified and amended by deleting therefrom Paragraph 16 in its entirety and
by substituting in lieu there of the following:
"16. Mortgagor will not, and no beneficiary of mortgagor will
enter into any new Lease or renewal of any Lease of all or any part of
the premises, without in each instance the prior approval of mortgagee.
Further, neither mortgagor nor any beneficiary of mortgager shall cancel
any Lease now or hereafter in effect, or terminate or accept a surrender
thereof or reduce the payment of the rent thereunder or accept any
prepayment of rent therein more than 30 days in advance of the time when
the same becomes do (except any amount which may be required to be prepaid
by the terms of such Lease) or otherwise amend or modify any Lease, without
in each instance the prior approval of mortgagee. Notwithstanding the
foregoing, mortgagee's prior approval shall not be required for any new
Leases demising less than 10,000 rentable square feet or renewals,
cancellations, terminations, amendments or modifications of existing Leases
demising less than 10,000 rentable square feet."
6
4. Effective as of the date hereof, the Mortgage is hereby
modified and amended by adding thereto a new Paragraph 43 as follows:
"43. ESCROW ACCOUNT.
"(A) ESTABLISHMENT OF ESCROW. Mortgagor shall establish
an Escrow Account for the receipt and management of funds deposited
pursuant to this Paragraph 43, said Escrow Account to be established
pursuant to that certain Escrow Agreement dated as of September 1, 1995 by
and among mortgagor, mortgagee and Cohen Financial Corporation, as Escrow
Agent. Said escrow agreement shall provide that funds may be withdrawn
from the account by mortgagor only for the funding of capital improvements
and tenant improvements on the mortgaged premises, leasing commissions in
connection with the leasing of the mortgaged premises and, to the extent
necessary, shortfalls in operating expenses for the mortgaged premises and
debt service on the loan evidenced by this mortgage. Any funds held in the
Escrow Account and not applied to the foregoing costs as of the maturity
date of the note shall be credited against amounts outstanding and due and
owing under the note as of the maturity date.
"(B) ESCROW PAYMENTS. Effective as of September 1, 1995,
through July 31, 1998 (and thus for monthly installments under the Note due
and payable on October 1, 1995, through and including the payment due on
August 1, 1998), mortgagor shall pay into the Escrow Account on or before
the 15th day of each month (commencing on October 15, 1995 and through and
including August 15, 1998), a sum equal to all Net Cash Flow, as defined
herein, for the previous month, such Net Cash Flow and the payments
described in this subparagraph (B) to be determined on a monthly basis,
except that to the extent Expenses (as defined herein) exceed Gross
Revenues (as defined herein) in any month, such difference, to the extent
such difference is not otherwise reduced by withdrawals from the Escrow
Account pursuant to the terms thereof, shall be carried forward to a
subsequent month or months and shall be applied against Gross Revenues in
such subsequent month or months. All calculations of Net Cash Flow,
Expenses, and Gross Revenues shall be made based upon receipts from the 1st
day of the subject month to and including the last day of the
7
subject month. Notwithstanding the foregoing, mortgagor shall
be permitted to make the Net Cash Flow payments due on October 15, 1995,
November 15, 1995, December 15, 1995 and January 15, 1996 on or before
January 29, 1996.
"(C) MONTHLY STATEMENT. Mortgagor shall send to
mortgagee, no later than the 15th day of each month commencing on October
15, 1995, a statement, in detail reasonably satisfactory to mortgagee,
showing Net Cash Flow, Expenses, and Gross Revenues for the previous month,
and justifying the amounts paid pursuant to the foregoing subparagrpah (B).
Notwithstanding the foregoing, if the Net Cash Flow payments due on October
15, 1995, November 15, 1995, December 15, 1995 and January 15, 1996 are
made on or before January 29, 1996 pursuant to subparagraph (B) of this
Paragraph 43, the corresponding monthly statements may also be submitted to
mortgagee on or before January 29, 1996.
"(D) DEFINITIONS. Net Cash Flow, and related terms, as
used herein, shall be defined as follows:
"(1) "Net Cash Flow" shall mean, for any month, all Gross
Revenues (as hereinafter defined) of the mortgaged premises for such month,
minus all Expenses (as hereinafter defined) of the mortgaged premises for
such month.
"(2) "Expenses" shall mean, for any month, all reasonable
expenses actually incurred by mortgagor within the categories set forth
below in respect to the ownership, operation, management, leasing, and
occupancy of the mortgaged premises, determined on the basis of sound cash
basis accounting practices consistently applied.
Expenses are as follows (but without duplication of any item):
(a) general real estate taxes; (b) special assessments or similar charges
paid to the appropriate governmental authorities; (c) personal property
taxes; (d) sales and use taxes; (e) costs of permits and similar
governmental fees, utilities, air conditioning, and heating for the
mortgaged premises; (f) maintenance and repair costs of a non-capital
nature, including, but not limited to, landscaping, parking lot
maintenance, cleaning, security, snow plowing and reserves for
replacements; (g) operating and management expenses and fees, provided,
however, that the amount of such management fees which may be charged
hereunder
8
shall not exceed four percent (4%) of Gross Revenues for any
month; (h) premiums paid for insurance carried on or with respect to the
mortgaged premises; (i) reasonable accounting and audit fees and costs; (j)
reasonable attorneys' fees and other administrative and general expenses
and disbursements, in each case reasonably and actually incurred by
mortgagor in connection with the ownership, operation, leasing, occupancy
and management of the mortgaged premises; (k) expenditures made by
mortgagor for tenant improvements to any space on the mortgaged premises if
such expenditures are required in connection with any Lease on the
mortgaged premises, including, but not limited to, architectural fees, fees
paid to contractors, subcontractors, laborers and engineers and
construction supervisory fees (but not including amounts disbursed from the
Escrow Account described herein); (1) direct labor costs for labor used in
the maintenance and repair of the mortgaged premises (but not to exceed
labor costs customarily charged in the Chicago metropolitan area for
similar services on similar properties); (m) leasing commissions paid in
connection with procuring tenants for the mortgaged premises (but not
including amounts disbursed from the Escrow Account described herein); (n)
fees payable to the Escrow Agent under the Escrow Account; (o) expenses
incurred or paid by mortgagor in connection with the modification of the
loan secured hereby (other than attorneys' fees); (p) regularly scheduled
interest and escrow payments pursuant to, respectively, paragraph II(b) of
the note, as amended hereby and pursuant to paragraph 43(B) of the mortgage
as amended hereby; (q) to the extent applied to reduce the indebtedness
evidenced by the mortgage, all gross proceeds of rental loss or business
interruption insurance received by mortgagor, less the actual cost incurred
by mortgagor in collecting such proceeds; (r) to the extent applied to
reduce the indebtedness evidenced by the mortgage, all proceeds of casualty
insurance policies received by mortgagor, less the reasonable costs
incurred by mortgagor in collecting such proceeds; (s) to the extent
applied to reduce the indebtedness evidenced by the mortgage, any and all
gross proceeds of any condemnation awards received by mortgagor in
connection with the taking by any power or authority, whether through the
exercise of the right of condemnation or eminent domain or otherwise, for
the temporary use or permanent taking of the whole or any part of the
mortgaged
9
premises, less the actual costs incurred by mortgagor in
collecting such proceeds; (t) return to tenants of their respective
security deposits and interest thereon, to the extent the payment of
interest thereon is provided in such tenant's lease; and (u) replenishment
of amounts expended from the operating account maintained by mortgagor with
respect to the mortgaged premises, not to exceed, however, in any calendar
month, the lesser of the aggregate expenditures for such month or
$50,000.00, and mortgagor shall furnish to mortgagee, with the monthly
statement described in subparagraph (C) of this Paragraph 43, evidence
satisfactory to mortgagee of the purpose of the expenditures from the
operating account and the balance therein from time to time.
Notwithstanding anything included within the above definition
of "Expenses", the following shall be excluded from Expenses: (i)
depreciation, amortization, and other non-cash deduction of mortgagor for
income tax purposes; (ii) payments made in respect of the principal or
interest on, or charges related to, any loan of mortgagor, except as
otherwise included in Expenses pursuant to section (p) above; (iii)
attorneys' fees incurred by mortgagor or paid by mortgagor in connection
with the loan secured hereby or the modification thereof; (iv) any interest
or late fees paid by mortgagor for any overdue or delinquent payments; (v)
any expenditures described in subsections (a) through (u) above made to
third parties related to or affiliated with mortgagor or the beneficiary of
mortgagor which are in excess of a reasonable fee or expense for such
expenditure or which are otherwise in excess of the fees which would be
payable to unrelated third parties in arm's lengths transactions for
similar services in the Chicago metropolitan area; and (vi) costs of
replacements or improvements of a capital nature.
"(3) "Gross Revenues" shall mean all gross income, rentals,
revenues, and consideration, in whatever form or nature, actually received
by or paid to or for the account or benefit of mortgagor, from any and all
sources resulting from or attributable to the ownership, operation,
leasing, and occupancy of the mortgaged premises, directly or indirectly,
determined on the basis of sound cash basis accounting practices
consistently applied, including but not limited to, any or all of the
following (but without duplication of any item); (a) rentals
10
and additional rentals payable by Tenants under any Leases; (b)
amounts payable by Tenants pursuant to escalation, percentage rental, or
other adjustment provisions in Leases or on account of maintenance or
service charges, taxes, assessments, utilities, air conditioning and
heating, and other administrative, management, operating, leasing and
maintenance expenses and other pass-through expenses for the mortgaged
premises; (c) late charges and interest payable on rentals; (d) security
deposits payable by tenants and interest on security deposits, reserves or
other accounts held in connection with the mortgaged premises, including,
but not limited to, any restoration accounts; (e) rents and receipts from
furniture, cable television, licenses, concessions, laundry facilities,
vending machines and similar items, including, without limitation, from
garages, carports, parking spaces and storage space; (f) all gross proceeds
of rental loss or business interruption insurance received by mortgagor,
less the actual cost incurred by mortgagor in collecting such proceeds; (g)
all proceeds of casualty insurance policies received by mortgagor, less the
reasonable cost incurred by mortgagor in collecting such proceeds; (h) any
and all gross proceeds of any condemnation awards received by mortgagor in
connection with the taking by any power or authority, whether through the
exercise of the right of condemnation or eminent domain or otherwise, for
the temporary use or permanent taking of the whole or any part of the
mortgaged premises, less the actual costs incurred by mortgagor in
collecting such proceeds; (i) other fees, charges or payments not
denominated as rental payment for or in connection with the rental of space
in the mortgaged premises; (j) payment made as consideration in whole or in
part for the cancellation, modification, extension or renewal of Leases,
including, without limitation, forfeitures of deposits or settlement
payments; (k) rental or other concessions in the nature of rental payment
for, or the fair rental value of, any portion of the mortgaged premises
that may be used by mortgagor or an Affiliate of mortgagor other than
rental paid in connection with an on-site management office maintained by
mortgagor or an Affiliate of mortgagor; and (l) any and all payments made
in connection with any litigation in connection with the mortgaged premises
to mortgagor or an Affiliate of mortgagor, including but not limited to any
payments made in settlement of any such litigation, less the actual costs
incurred by mortgagor or an
11
Affiliate of mortgagor in collecting such payments.
Notwithstanding anything included within the above definition of "Gross
Revenues", there shall be excluded from Gross Revenues contributions by the
constituent partners of mortgagor.
Notwithstanding clauses (f), (g) and (h) above, the terms and
conditions of the documents evidencing and securing the loan shall control
the application of such proceeds.
"(4) "Affiliate" shall mean any Person directly or indirectly,
through one or more intermediaries, controlling, controlled by, or under
common control with, the Person in question, which, in the case of a Person
which is a partnership, shall include each of the constituent partners
thereof. The term "control" as used in the immediately preceding sentence,
means, with respect to a Person that is a corporation, the right to the
exercise, directly or indirectly, or the voting rights attributable to the
shares of the controlled corporation, and, with respect to a Person that is
not a corporation, the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of the
controlled Person.
"(5) "Leases" shall mean all leases and occupancy agreements,
whether written or verbal, and all amendments, modification, extensions and
renewals thereof, covering all or any portion of the mortgaged premises.
"(6) "Tenants" shall mean all tenants (or permitted assignees
or subtenants at any level thereof) under the Leases and all other tenants
or occupants of the mortgaged premises.
"(7) "Person" shall mean an individual, partnership,
corporation, trust, unincorporated association, or other entity or
association."
5. Mortgagor and John Hancock acknowledge that as of the date
hereof, the principal balance of the Loan outstanding is $12,330,749.17.
6. Neither the execution and delivery of this Third Note and
Mortgage Modification Agreement (the "Modification Agreement"), nor
12
any provision hereof, shall be deemed to impair or adversely affect in any
way the lien or security interest of the Mortgage or the priority thereof
as existing prior to the date of this Modification Agreement.
7. without any limitation, modification, change or diminution of
any of the interests which John Hancock acquired, obtained or has in the
real property described in EXHIBIT A attached hereto on account of the
Mortgage, Mortgagor covenants and agrees that the Mortgage, as amended by
this Modification Agreement, secures all sums evidenced by the Note, and
interest thereon, all payable in accordance with the terms of the Note, as
amended hereby, together with all renewals, extensions, modifications or
amendments to and substitutions for such Note (the terms of the Note being
incorporated into the Mortgage by this reference), and further secures all
other sums described in the Mortgage; provided, however, the maximum amount
of principal indebtedness that may be secured by the Mortgage, at any one
time, is TWELVE MILLION SIX HUNDRED THOUSAND AND NO/100 DOLLARS
($12,600,000.00), plus interest thereon as provided in the Note and any
additional sums advanced by John Hancock pursuant to the Note, the
Mortgage, or any other document or instrument securing the Loan as may be
required in order to protect the security of the indebtedness evidenced by
the Note.
8. This Modification Agreement is executed by LaSALLE NATIONAL
TRUST, N.A., a national banking association, as Trustee under a certain
Trust Agreement dated October 24, 1978 and known as Trust No. 100104, (the
"Trust Agreement") not personally, but as
13
Trustee as aforesaid in the exercise of the power and authority conferred
upon and vested in it as such Trustee (and said LaSALLE NATIONAL TRUST,
N.A. hereby warrants that is possesses full power and authority to execute
this instrument), and it is expressly understood and agreed that nothing
herein contained shall be construed as creating any liability on said
LaSALLE NATIONAL TRUST, N.A. personally to pay the Note or any interest
that my accrue thereon, or any indebtedness accruing thereunder, or to
perform any covenant either express or implied herein contained (it being
understood and agreed that each of the provisions hereof, except the
warranty hereinabove contained, shall constitute a condition and not a
covenant or agreement regardless of whether the same may be couched in
language of a promise or covenant or agreement), all such personal
liability, if any, being expressly waived by John Hancock and by every
person now or hereafter claiming any right or security hereunder, and that
so far as the said LaSALLE NATIONAL TRUST, N.A. personally is concerned,
the legal holder or holders of the Note and the owner or owners of any
indebtedness accruing thereunder shall look solely to the premises conveyed
by the Mortgage and any other security agreements, documents or instruments
or guaranties (all of which are referred to collectively herein as the
"Security Papers") securing the Note for the payment thereof, by the
enforcement of the liens, charges and other rights created by said Security
papers, in the manner herein and in said Security Papers, or by action to
enforce the personal liability of guarantors, if any.
14
9. It is expressly understood and agreed that nothing herein
contained in this Modification Agreement, the Note, the Mortgage of any
other document, instrument or agreement evidencing, securing or executed in
connection with the Loan shall be construed as creating any personal
liability of the beneficiary ("Beneficiary") under the Trust Agreement or
of any direct or indirect partners in Beneficiary, or of any officers,
directors, shareholders, employees or agents of Beneficiary or of such
partners in Beneficiary to pay the Note, or any interest that may accrue
thereon, or any indebtedness accruing thereunder, or to perform any
covenant either express or implied, or for any breach of a representation
or warranty, it being understood that the legal holder or holders of the
Note and the owner or owners of any indebtedness accruing thereunder, shall
look solely to the real property securing such indebtedness.
10. Each provision of this Modification Agreement and of the Note
and the Mortgage shall be considered severable, and if for any reason and
provision or provisions or any part thereof are determined to be invalid or
unenforceable under applicable law, such invalidity or unenforceability
shall not impair the validity or enforceability of those portions of the
Modification Agreement, the Note or the Mortgage, as the case may be, which
are valid and enforceable.
11. Except as hereby modified and amended, the Mortgage, the Note
and all other documents evidencing and securing the Note, and all terms and
provisions thereof, are hereby ratified and confirmed.
15
IN WITNESS WHEREOF, Mortgagor and John Hancock have caused this
Agreement to be executed and delivered as of the date and year first above
written.
LaSALLE NATIONAL TRUST, N.A.,
as successor trustee to LaSalle
National Bank, a national bank-
ing association, not personally
but as Trustee under Trust Number
100104
By JOSEPH W. LANG
Its: Joseph W. Lang
Sr. Vice President
ATTEST:
By: NANCY A. STACK
Nancy A. Stack
Its (Assistant) Secretary
(Impress corporate seal here)
JOHN HANCOCK MUTUAL LIFE INSUR-
ANCE COMPANY, a Massachusetts
corporation
By:
Its:
ATTEST:
By:
Its (Assistant) Secretary
(Impress corporate seal here)
This document may be executed
in counterparts, which together
shall constitute an original.
16
IN WITNESS WHEREOF, Mortgagor and John Hancock have caused this
Agreement to be executed and delivered as of the date and year first above
written.
LaSALLE NATIONAL TRUST, N.A.,
as successor trustee to LaSalle
National Bank, a national bank-
ing association, not personally
but as Trustee under Trust Number
100104
By
Its:
President
ATTEST:
By:
Its (Assistant) Secretary
(Impress corporate seal here)
JOHN HANCOCK MUTUAL LIFE INSUR-
ANCE COMPANY, a Massachusetts
corporation
By: TIMOTHY A. ROSEEN
Its Timothy A. Roseen
ATTEST:
By: BARRY P. SAXON
Barry P. Saxon
Its (Assistant) Secretary
(Impress corporate seal here)
This document may be executed
in counterparts, which together
shall constitute an original.
16
STATE OF ILLINOIS )
) SS.
COUNTY OF COOK )
The foregoing instrument was acknowledged before me this ----- day
of January, 1996 by JOSEPH W. LANG - SR. VICE PRESIDENT and NANCY A. STACK
- - ASSISTANT SECRETARY President of LaSALLE NATIONAL TRUST, N.A., as
successor trustee to LaSalle National Bank, a national banking association,
on behalf of the association, as Trustee under Trust No. 100104.
---------------------------
NOTARY PUBLIC
(Impress Notarial Seal Here)
My commission expires:---------------------, 19----
COMMONWEALTH OF MASSACHUSETTS)
) SS.
COUNTY OF SUFFOLK )
The foregoing instrument was acknowledged before me this ----- day of
January, 1996 by -------------------------------, -------------------------
of JOHN HANCOCK MUTUAL LIKE INSURANCE COMPANY, a Massachusetts
corporation, on behalf of the corporation.
---------------------------
NOTARY PUBLIC
(Impress Notarial Seal Here)
My commission expires: ---------------------, 19-----
Address of Property: One Woodfield Lake
Schaumburg, Illinois
Permanent Index No: 07-14-200-037-0000
This instrument prepared by (and return after recording to):
Stephanie B. Shellenback, Esq.
Wilson & McIlvaine
500 West Madison Street
Chicago, Illinois 60661
312-715-5000
or
Box 326
17
EXHIBIT A
PARCEL 1:
THAT PART OF THE NORTH EAST 1/4 OF SECTION 14, TOWNSHIP 41 NORTH, RANGE 10,
EAST OF THE THIRD PRINCIPAL MERIDIAN, DESCRIBED AS FOLLOWS: COMMENCING AT
THE SOUTH WEST CORNER OF THE NORTH EAST 1/4 AFORESAID; THENCE NORTH 86
DEGREES 03 MINUTES 42 SECONDS EAST ALONG THE SOUTH LINE OF SAID NORTH EAST
1/4, 927.60 FEET; THENCE NORTH 3 DEGREES 56 MINUTES 18 SECONDS WEST 50.00
FEET TO THE PLACE OF BEGINNING; THENCE CONTINUING NORTH 3 DEGREES 56
MINUTES 18 SECONDS WEST 710.00 FEET; THENCE NORTH 86 DEGREES 03 MINUTES 42
SECONDS EAST ALONG A LINE 760.00 FEET NORTH OF AND PARALLEL WITH THE SOUTH
LINE OF SAID NORTH EAST 1/4, 566.00 FEET; THENCE SOUTH 8 DEGREES 26 MINUTES
11 SECONDS WEST 256.03 FEET; THENCE SOUTH 33 DEGREES 02 MINUTES 24 SECONDS
EAST 278.64 FEET; THENCE SOUTH 47 DEGREES 58 MINUTES 24 SECONDS EAST 254.55
FEET; THENCE SOUTH 3 DEGREES 56 MINUTES 18 SECONDS EAST 33.45 FEET TO THE
NORTHERLY RIGHT OF WAY LINE OF WOODFIELD ROAD; THENCE SOUTH 86 DEGREES 03
MINUTES 42 SECONDS WEST ALONG SAID RIGHT OF WAY LINE 823.58 FEET TO THE
POINT OF BEGINNING, IN COOK COUNTY, ILLINOIS
PARCEL 2
THAT PART OF THE NORTH EAST 1/4 OF SECTION 14, TOWNSHIP 41 NORTH, RANGE 10
EAST OF THE THIRD PRINCIPAL MERIDIAN, DESCRIBED AS FOLLOWS: COMMENCING AT
THE SOUTH WEST CORNER OF THE NORTH EAST 1/4 AFORESAID;
THENCE NORTH 0 DEGREES 00 MINUTES 00 SECONDS EAST ALONG THE WEST LINE OF
SAID NORTH EAST 1/4, A DISTANCE OF 50.12 FEET TO A POINT; THENCE NORTH 86
DEGREES 03 MINUTES 42 SECONDS EAST ALONG THE NORTHERLY RIGHT OF WAY LINE OF
WOODFIELD ROAD, A DISTANCE OF 924.16 FEET TO A POINT; THENCE NORTH 3
DEGREES 56 MINUTES 18 SECONDS WEST A DISTANCE OF 229.00 FEET TO A POINT OF
BEGINNING; THENCE SOUTH 86 DEGREES 03 MINUTES 42 SECONDS WEST A DISTANCE OF
59.00 FEET TO A POINT; THENCE NORTH 3 DEGREES 56 MINUTES 18 SECONDS WEST A
DISTANCE OF 229.00 FEET TO A POINT OF BEGINNING; THENCE SOUTH 86 DEGREES
03 MINUTES 42 SECONDS WEST A DISTANCE OF 59.00 FEET TO A POINT; THENCE
NORTH 3 DEGREES 56 MINUTES 18 SECONDS WEST A DISTANCE OF 481.00 FEET TO A
POINT; THENCE NORTH 86 DEGREES 03 MINUTES 42 SECONDS EAST A DISTANCE OF
59.00 FEET TO A POINT; THENCE SOUTH 3 DEGREES 56 MINUTES 18 SECONDS EAST A
DISTANCE OF 481.00 FEET TO THE POINT OF BEGINNING, ALL IN COOK COUNTY,
ILLINOIS
PARCEL 3:
EASEMENTS APPURTENANT TO AND FOR THE BENEFIT OF PARCELS 1 AND 2 AS CREATED
AND SET FORTH IN DECLARATION OF PROTECTIVE COVENANTS, RESTRICTIONS AND
EASEMENTS DATED JULY 2, 1979 BETWEEN LASALLE NATIONAL BANK, A NATIONAL
BANKING ASSOCIATION, NOT PERSONALLY, BUT AS TRUSTEE UNDER A TRUST AGREEMENT
DATED OCTOBER 24, 1978 AND KNOWN AS TRUST NUMBER 100103, LASALLE NATIONAL
BANK, A NATIONAL BANKING ASSOCIATION, NOT PERSONALLY, BUT AS TRUSTEE UNDER
A TRUST AGREEMENT DATED OCTOBER 24, 1978 AND KNOWN AS TRUST NUMBER 100104,
AND THE FIRST NATIONAL BANK OF CHICAGO, NO PERSONALLY, BUT AS TRUSTEE OF
THE FIRST NATIONAL BANK OF CHICAGO GROUP TRUST FOR PENSION AND PROFIT
SHARING TRUSTS, FUND "F", UNDER DECLARATION OF TRUST DATED DECEMBER 1,
1972, AND RECORDED OCTOBER
17, 1979 IN THE OFFICE OF THE RECORDER OF DEEDS OF COOK COUNTY, ILLINOIS AS
DOCUMENT NUMBER 25196718, OVER THE FOLLOWING DESCRIBED REAL PROPERTY:
PARCEL "A":
THAT PART OF THE NORTH EAST 1/4 OF SECTION 14, TOWNSHIP 41 NORTH, RANGE 10
EAST OF THE THIRD PRINCIPAL MERIDIAN, DESCRIBED AS FOLLOWS: COMMENCING AT
THE POINT OF INTERSECTION OF A LINE DRAWN 561.22 FEET (MEASURED
PERPENDICULARLY) SOUTH OF AND PARALLEL WITH THE SOUTH LINE OF GOLF ROAD AS
DESCRIBED IN DOCUMENT NUMBER 10488004 WITH THE WEST LINE OF THE AFORESAID
NORTH EAST 1/4; THENCE SOUTH 530.00 FEET ALONG SAID WEST LINE TO A POINT;
THENCE NORTH 87 DEGREES 19 MINUTES 50 SECONDS EAST, 482.00 FEET ALONG A
LINE PARALLEL WITH THE SOUTH LINE OF GOLF ROAD AFORESAID; THENCE SOUTH 14
DEGREES 43 MINUTES 48 SECONDS EAST, 112.178 FEET THENCE SOUTH 87 DEGREES 22
MINUTES 25 SECONDS EAST, 218.229 FEET; THENCE NORTH 74 DEGREES 52 MINUTES
34 SECONDS EAST, 38.33 FEET; THENCE SOUTH 79 DEGREES 22 MINUTES 49 SECONDS
EAST, 162.788 FEET; THENCE NORTH 87 DEGREES 19 MINUTES 50 SECONDS EAST,
227.00 FEET; THENCE SOUTH 49 DEGREES 05 MINUTES 46 SECONDS EAST, 155.694
FEET; THENCE NORTH 87 DEGREES 19 MINUTES 50 SECONDS EAST, 175.00 FEET;
THENCE NORTH 02 DEGREES 40 MINUTES 10 SECONDS EAST, 70.00 FEET; THENCE
NORTHEASTERLY 617.352 FEET ALONG THE ARC OF A CIRCLE OF 500.00 FEET RADIUS,
CONVEX TO THE NORTH WEST AND WHOSE CHORD BEARS NORTH 54 DEGREES 37 MINUTES
34 SECONDS EAST TO A POINT OF TANGENCY, SAID POINT OF TANGENCY BEGIN
771.913 FEET WESTERLY OF THE EAST LINE OF THE AFORESAID NORTH EAST 1/4 OF
SECTION 14, (AS MEASURED ALONG A LINE DRAWN 66.00 FEET SOUTH OF AND
PARALLEL WITH THE SOUTHERN TERMINUS AND WESTERLY EXTENSION THEREOF OF
MEACHAM ROAD AS DESCRIBED PER COURT CASE NUMBER 68-"L"-13469, IN THE WEST
1/2 OF THE NORTH WEST 1/4 OF SECTION 13, TOWNSHIP AND RANGE AFORESAID);
THENCE SOUTH 89 DEGREES 59 MINUTES 52 SECONDS WEST, 171.24 FEET ALONG THE
AFORESAID WESTERLY EXTENSION OF THE SOUTHERN TERMINUS OF MEACHAM ROAD;
THENCE NORTH 2 DEGREES 40 MINUTES 10 SECONDS WEST, 66.072 FEET; THENCE
NORTHWESTERLY 84.054 FEET ALONG THE ARC OF A CIRCLE OF 84.00 FEET RADIUS.
CONVEX TO THE SOUTH WEST AND WHOSE CHORD BEARS NORTH 61 DEGREES 20 MINUTES
11 SECONDS WEST, TO A POINT OF TANGENCY; THENCE NORTH 32 DEGREES 40 MINUTES
10 SECONDS WEST, 256.717 FEET ALONG A LINE TANGENT TO THE LAST DESCRIBED
ARC TO A POINT OF CURVATURE; THENCE NORTHWESTERLY 157.079 FEET ALONG THE
ARC OF A CIRCLE OF 150.00 FEET RADIUS, WHICH ARC IS TANGENT TO THE
AFORESAID 561.22 FEET PARALLEL LINE AT A POINT 1404.175 FEET (AS MEASURED
ALONG SAID PARALLEL LINE), EASTERLY OF THE POINT OF BEGINNING, CONVEX TO
THE NORTH EAST AND HAS A CHORD BEARING OF NORTH 62 DEGREES 40 MINUTES 10
SECONDS WEST, TO SAID PARALLEL LINE; THENCE SOUTH 87 DEGREES 19 MINUTES 50
SECONDS WEST, 1404.175 FEET ALONG SAID PARALLEL LINE TO THE POINT OF
BEGINNING, (EXCEPTING THAT PART OF THE AFORESAID PARCEL FALLING WITHIN
DEDICATED STREETS AND HIGHWAYS AS SHOWN ON DOCUMENT NUMBER 22935012
RECORDED DECEMBER 12, 1974) IN COOK COUNTY, ILLINOIS;
PARCEL "B":
THAT PART OF THE NORTH EAST 1/4 OF SECTION 14, TOWNSHIP 41 NORTH, RANGE 10
EAST OF THE THIRD PRINCIPAL MERIDIAN, DESCRIBED AS FOLLOWS: COMMENCING AT
THE INTERSECTION OF THE WEST LINE OF THE SAID NORTH EAST 1/4 OF SECTION 14
WITH A LINE BEING 561.22 FEET (MEASURED PERPENDICULARLY) SOUTH OF AND
PARALLEL WITH THE SOUTH LINE OF GOLF ROAD, PER DOCUMENT NUMBER 10488004;
THENCE SOUTH ALONG THE WEST LINE OF
A-2
THE SAID NORTH EAST 1/4, A DISTANCE OF 530.00 FEET TO THE POINT OF
BEGINNING; THENCE EASTWARD ALONG A LINE BEING PARALLEL WITH THE SOUTH LINE
OF GOLF ROAD AFORESAID, NORTH 87 DEGREES 19 MINUTES 50 SECONDS EAST, A
DISTANCE OF 482.00 FEET; THENCE SOUTH 14 DEGREES 43 MINUTES 48 SECONDS
EAST, A DISTANCE OF 112.178 FEET; THENCE SOUTH 87 DEGREES 22 MINUTES 25
SECONDS EAST, A DISTANCE OF 218.229 FEET; THENCE NORTH 74 DEGREES 52
MINUTES 34 SECONDS EAST, A DISTANCE OF 38.33 FEET; THENCE SOUTH 79 DEGREES
22 MINUTES 49 SECONDS EAST, A DISTANCE OF 162.788 FEET; THENCE NORTH 87
DEGREES 19 MINUTES 50 SECONDS EAST, A DISTANCE OF 227.00 FEET; THENCE SOUTH
49 DEGREES 05 MINUTES 46 SECONDS EAST, A DISTANCE OF 97.198 FEET; THENCE
SOUTH 62 DEGREES 27 MINUTES 08 SECONDS WEST, A DISTANCE OF 54.06 FEET;
THENCE SOUTH 37 DEGREES 44 MINUTES 07 SECONDS EAST, A DISTANCE OF 95.78
FEET; THENCE SOUTH 64 DEGREES 50 MINUTES 51 SECONDS EAST, A DISTANCE OF
127.53 FEET; THENCE SOUTH 23 DEGREES 37 MINUTES 15 SECONDS EAST, A DISTANCE
OF 244.51 FEET; THENCE SOUTH 8 DEGREES 26 MINUTES 11 SECONDS WEST, A
DISTANCE OF 334.05 FEET; THENCE SOUTH 33 DEGREES 02 MINUTES 24 SECONDS
EAST, A DISTANCE OF 278.64 FEET; THENCE SOUTH 47 DEGREES 58 MINUTES 24
SECONDS EAST, A DISTANCE OF 254.55 FEET; THENCE SOUTH 3 DEGREES 56 MINUTES
18 SECONDS EAST, A DISTANCE OF 83.45 FEET TO A POINT ON THE SOUTH LINE OF
THE NORTH EAST 1/4 OF SAID SECTION 14; THENCE WESTWARD ALONG THE SAID SOUTH
LINE, SOUTH 86 DEGREES 03 MINUTES 42 SECONDS WEST, A DISTANCE OF 1751.19
FEET TO THE SOUTH WEST CORNER OF THE SAID NORTH EAST 1/4 OF SECTION 14;
THENCE NORTH ALONG THE WEST LINE OF THE SAID NORTH EAST 1/4, A DISTANCE OF
1486.043 FEET TO THE POINT OF BEGINNING, ALL IN COOK COUNTY, ILLINOIS,
EXCEPTING THEREFROM THAT PART OF THE FOREGOING PARCEL DESCRIBED AS FOLLOWS:
THAT PART OF THE NORTH EAST 1/4 OF SECTION 14, TOWNSHIP 41 NORTH, RANGE 10,
EAST OF THE THIRD PRINCIPAL MERIDIAN, DESCRIBED AS FOLLOWS: COMMENCING AT
THE SOUTH WEST CORNER OF THE NORTH EAST 1/4 AFORESAID; THENCE NORTH 86
DEGREES 03 MINUTES 42 SECONDS EAST ALONG THE SOUTH LINE OF SAID NORTH EAST
1/4 927.60 FEET; THENCE NORTH 3 DEGREES 56 MINUTES 18 SECONDS WEST 50.00
FEET TO THE PLACE OF BEGINNING; THENCE CONTINUING NORTH 3 DEGREES 56
MINUTES 18 SECONDS WEST 710.FEET; THENCE NORTH 86 DEGREES 03 MINUTES 42
SECONDS EAST ALONG A LINE 760.00 FEET NORTH OF AND PARALLEL WITH THE SOUTH
LINE OF SAID NORTH EAST 1/4 566.00 FEET; THENCE SOUTH 8 DEGREES 26 MINUTES
11 SECONDS WEST 256.03 FEET; THENCE; SOUTH 33 DEGREES 02 MINUTES 24 SECONDS
EAST 278.64 FEET; THENCE SOUTH 47 DEGREES 58 MINUTES 24 SECONDS EAST 254.55
FEET; THENCE SOUTH 3 DEGREES 56 MINUTES 18 SECONDS EAST 33.45 FEET TO THE
NORTHERLY RIGHT-OF-WAY LINE OF WOODFIELD ROAD; THENCE SOUTH 86 DEGREES 03
MINUTES 42 SECONDS WEST ALONG SAID RIGHT OF WAY LINE 823.58 FEET TO THE
POINT OF BEGINNING, IN COOK COUNTY, ILLINOIS;
AND ALSO
THAT PART OF THE NORTH EAST 1/4 OF SECTION 14, TOWNSHIP 41 NORTH, RANGE 10
EAST OF THE THIRD PRINCIPAL MERIDIAN, DESCRIBED AS FOLLOWS: COMMENDING AT
THE SOUTH WEST CORNER OF THE NORTH EAST 1/4 AFORESAID; THENCE NORTH 0
DEGREES 00 MINUTES 00 SECONDS EAST ALONG THE WEST LINE OF SAID NORTH EAST
1/4, A DISTANCE OF 50.12 FEET TO A POINT; THENCE NORTH 86 DEGREES 03
MINUTES 42 SECONDS EAST ALONG THE NORTHERLY RIGHT-OF-WAY LINE OF WOODFIELD
ROAD, A DISTANCE OF 924.16 FEET TO A POINT; THENCE NORTH 3 DEGREES 56
MINUTES 18 MINUTES 18 SECONDS WEST A DISTANCE OF 229.00 FEET TO A POINT OF
BEGINNING; THENCE SOUTH 86 DEGREES 03 MINUTES 42 SECONDS WEST A DISTANCE OF
59.00 FEET TO A POINT; THENCE NORTH 3 DEGREES 56 MINUTES 18 SECONDS WEST A
DISTANCE OF 481.00 FEET TO A POINT; THENCE NORTH 86 DEGREES 03 MINUTES 42
SECONDS EAST A DISTANCE OF 59.00 FEET TO A POINT; THENCE SOUTH 3 DEGREES 56
MINUTES 18 SECONDS EAST A DISTANCE OF 481.00 FEET TO POINT OF BEGINNING, IN
COOK COUNTY, ILLINOIS;
A-3
PARCEL "C":
THAT PART OF THE NORTH EAST 1/4 OF SECTION 14, TOWNSHIP 41 NORTH, RANGE 10
EAST OF THE THIRD PRINCIPAL MERIDIAN, DESCRIBED AS FOLLOWS: COMMENCING AT
THE SOUTH WEST CORNER OF THE SAID NORTH EAST 1/4 OF SECTION 14; THENCE
EASTWARD ALONG THE SOUTH LINE OF THE SAID NORTH EAST 1/4, NORTH 86 DEGREES
03 MINUTES 42 SECONDS EAST, A DISTANCE OF 1751.19 FEET TO THE POINT OF
BEGINNING; THENCE NORTH 3 DEGREES 56 MINUTES 18 SECONDS WEST, A DISTANCE OF
83.45 FEET; THENCE NORTH 47 DEGREES 58 MINUTES 24 SECONDS WEST, A DISTANCE
OF 254.55 FEET; THENCE NORTH 33 DEGREES 02 MINUTES 24 SECONDS WEST, A
DISTANCE OF 278.64 FEET; THENCE NORTH 8 DEGREES 26 MINUTES 11 SECONDS EAST,
A DISTANCE OF 334.05 FEET; THENCE NORTH 23 DEGREES 37 MINUTES 15 SECONDS
WEST, A DISTANCE OF 244.51 FEET; THENCE NORTH 64 DEGREES 50 MINUTES 51
SECONDS WEST, A DISTANCE OF 127.53 FEET; THENCE NORTH 37 DEGREES 44 MINUTES
07 SECONDS WEST, A DISTANCE OF 95.78 FEET; THENCE NORTH 62 DEGREES 27
MINUTES 08 SECONDS EAST, A DISTANCE OF 54.06 FEET; THENCE SOUTH 49 DEGREES
05 MINUTES 46 SECONDS EAST, A DISTANCE OF 58.496 FEET; THENCE NORTH 87
DEGREES 19 MINUTES 50 SECONDS EAST, A DISTANCE OF 175.00 FEET; THENCE SOUTH
5 DEGREES 02 MINUTES 21 SECONDS EAST, A DISTANCE OF 298.79 FEET; THENCE
SOUTH 10 DEGREES 25 MINUTES 51 SECONDS EAST, A DISTANCE OF 447.39 FEET;
THENCE SOUTH 42 DEGREES 49 MINUTES 50 SECONDS EAST, A DISTANCE OF 502.73
FEET TO A POINT ON THE NORTHERLY LINE OF WOODFIELD ROAD AS DEDICATED AS
DOCUMENT NUMBER 22935012; THENCE SOUTH 3 DEGREES 56 MINUTES 18 SECONDS
EAST, A DISTANCE OF 50.00 FEET TO A POINT ON THE SOUTH LINE OF THE SAID
NORTH EAST 1/4 OF SECTION 14; THENCE WESTWARD ALONG THE SAID WORTH LINE,
SOUTH 86 DEGREES 03 MINUTES 42 SECONDS WEST, A DISTANCE OF 150.00 FEET TO
THE POINT OF BEGINNING, EXCEPTING THEREFROM THAT PART DEDICATED FOR ROAD
PURPOSES BY PLAT OF DEDICATION FOR PUBLIC STREET DATED JULY 9, 1974 AND
RECORDED DECEMBER 12, 1974 AS DOCUMENT NUMBER 22935012, ALL IN COOK COUNTY,
ILLINOIS
PARCEL "D":
THAT PART OF THE NORTH EAST 1/4 OF SECTION 14, TOWNSHIP 41 NORTH, RANGE 10
EAST OF THE THIRD PRINCIPAL MERIDIAN, DESCRIBED AS FOLLOWS: COMMENCING AT
THE POINT OF INTERSECTION OF A LINE DRAWN 561.22 FEET (MEASURED
PERPENDICULARLY) SOUTH OF AND PARALLEL WITH THE SOUTH LINE OF GOLF ROAD AS
DESCRIBED IN DOCUMENT NUMBER 10488004 WITH THE WEST LINE OF THE AFORESAID
NORTH EAST 1/4; THENCE SOUTH 530.00 FEET ALONG SAID WEST LINE TO THE PLACE
OF BEGINNING OF THE HEREIN DESCRIBED PROPERTY; THENCE NORTH 87 DEGREES 19
MINUTES 50 SECONDS EAST 482.00 FEET ALONG A LINE PARALLEL WITH THE SOUTH
LINE OF GOLF ROAD AFORESAID; THENCE SOUTH 14 DEGREES 43 MINUTES 48 SECONDS
EAST 112.178 FEET; THENCE SOUTH 87 DEGREES 22 MINUTES 25 SECONDS EAST,
218.229 FEET; THENCE NORTH 74 DEGREES 52 MINUTES 34 SECONDS EAST 38.33
FEET; THENCE SOUTH 79 DEGREES 22 MINUTES 49 SECONDS EAST, 162.788 FEET;
THENCE NORTH 87 DEGREES 19 MINUTES 50 SECONDS EAST 227.00 FEET; THENCE
SOUTH 49 DEGREES 05 MINUTES 46 SECONDS EAST 155.694 FEET; THENCE NORTH 87
DEGREES 19 MINUTES 50 SECONDS EAST 175.00 FEET; THENCE NORTH 02 DEGREES 40
MINUTES 10 SECONDS EAST 70.00 FEET; THENCE NORTHEASTERLY 617.352 FEET ALONG
THE ARC OF A CIRCLE OF 500.00 FEET RADIUS, CONVEX TO THE NORTH WEST AND
WHOSE CORD BEARS NORTH 54 DEGREES 37 MINUTES 34 SECONDS EAST TO A POINT OF
TANGENCY, SAID POINT OF TANGENCY BEING 771.913 WESTERLY OF THE EAST LINE OF
THE AFORESAID NORTH EAST 1/4 OF SECTION 14 (AS MEASURED ALONG A LINE DRAWN
66.00 FEET SOUTH OF AND PARALLEL WITH THE SOUTHERN
A-4
TERMINUS AND THE WESTERLY EXTENSION THEREOF OF MEACHAM ROAD AS DESCRIBED
PER COURT CASE NUMBER 68-"L"-13469 IN THE WEST 1/2 OF THE NORTH WEST 1/4
SECTION 13, TOWNSHIP AND RANGE AFORESAID); THENCE NORTH 89 DEGREES 59
MINUTES 52 SECONDS EAST 771.913 FEET ALONG SAID EXTENSION TO THE EAST LINE
OF THE AFORESAID NORTH EAST 1/4 OF SECTION 14; THENCE SOUTH 0 DEGREES 04
MINUTES 02 SECONDS EAST 1506.436 FEET ALONG SAID EAST LINE OF THE NORTH
EAST 1/4 TO THE SOUTH EAST CORNER THEREOF; THENCE SOUTH 86 DEGREES 03
MINUTES 42 SECONDS WEST 2699.57 FEET ALONG THE SOUTH LINE OF SAID NORTH
EAST 1/4 TO THE SOUTH WEST CORNER THEREOF; THENCE NORTH 1486.043 FEET ALONG
THE WEST LINE OF SAID NORTH EAST 1/4 TO THE PLACE OF BEGINNING, IN COOK
COUNTY, ILLINOIS, EXCEPTING THEREFROM THOSE PARTS OF THE FOREGOING PARCEL
DESCRIBED AS FOLLOWS:
THAT PART OF THE NORTH EAST 1/4 OF SECTION, TOWNSHIP 41 NORTH, RANGE 10
EAST OF THE THIRD PRINCIPAL MERIDIAN, DESCRIBED AS FOLLOWS: COMMENCING AT
THE INTERSECTION OF THE WEST LINE OF THE SAID NORTH EAST 1/4 OF SECTION 14
WITH A LINE BEING 561.22 FEET (MEASURED PERPENDICULARLY) SOUTH OF AND
PARALLEL WITH THE SOUTH LINE OF GOLF ROAD, PER DOCUMENT NUMBER 10488004;
THENCE SOUTH ALONG THE WEST LINE OF THE SAID NORTH EAST 1/4, A DISTANCE OF
530.00 FEET TO THE POINT OF BEGINNING; THENCE EASTWARD ALONG A LINE BEING
PARALLEL WITH THE SOUTH LINE OF GOLF ROAD AFORESAID, NORTH 87 DEGREES 19
MINUTES 50 SECONDS EAST, A DISTANCE OF 482.00 FEET; THENCE SOUTH 14 DEGREES
43 MINUTES 48 SECONDS EAST, A DISTANCE OF 112.178 FEET; THENCE SOUTH 87
DEGREES 22 MINUTES SECONDS EAST, A DISTANCE OF 218.229 FEET; THENCE NORTH
74 DEGREES 52 MINUTES 34 SECONDS EAST, A DISTANCE OF 38.33 FEET; THENCE
SOUTH 79 DEGREES 22 MINUTES 49 SECONDS EAST, A DISTANCE OF 162.788 FEET;
THENCE NORTH 87 DEGREES 19 MINUTES 50 SECONDS EAST, A DISTANCE OF 227.00
FEET; THENCE SOUTH 49 DEGREES 05 MINUTES 46 SECONDS EAST, A DISTANCE OF
97.198 FEET; THENCE SOUTH 62 DEGREES 27 MINUTES 08 SECONDS WEST A DISTANCE
OF 54.06 FEET; THENCE SOUTH 37 DEGREES 44 MINUTES 07 SECONDS EAST, A
DISTANCE OF 95.78 FEET; THENCE SOUTH 64 DEGREES 50 MINUTES 51 SECONDS EAST,
A DISTANCE OF 127.53 FEET; THENCE SOUTH 23 DEGREES 37 MINUTES 15 SECONDS
EAST, A DISTANCE OF 244.51 FEET; THENCE SOUTH 8 DEGREES 26 MINUTES 11
SECONDS WEST, A DISTANCE OF 334.05 FEET; THENCE SOUTH 33 DEGREES 02 MINUTES
24 SECONDS EAST, A DISTANCE OF 278.64 FEET; THENCE SOUTH 47 DEGREES 58
MINUTES 24 SECONDS EAST, A DISTANCE OF 254.55 FEET; THENCE SOUTH 3 DEGREES
56 MINUTES 18 SECONDS EAST, A DISTANCE OF 83.45 FEET TO A POINT ON THE
SOUTH LINE OF THE NORTH EAST 1/4 OF SAID SECTION 14; THENCE WESTWARD ALONG
THE SAID SOUTH LINE, SOUTH 86 DEGREES 03 MINUTES 42 SECONDS WEST, A
DISTANCE OF 1751.19 FEET TO THE SOUTH WEST CORNER OF THE SAID NORTH EAST
1/4 OF SECTION 14; THENCE NORTH ALONG THE WEST LINE OF THE SAID NORTH EAST
1/4, A DISTANCE OF 1486.043 FEET TO THE POINT OF BEGINNING, ALL IN COOK
COUNTY, ILLINOIS, AND ALSO EXCEPT
THAT PART OF THE NORTH EAST 1/4 OF SECTION 14, TOWNSHIP 41 NORTH, RANGE 10
EAST OF THE THIRD PRINCIPAL MERIDIAN, DESCRIBED AS FOLLOWS: COMMENCING AT
THE SOUTH WEST CORNER OF THE SAID NORTH EAST 1/4 OF SECTION 14; THENCE
EASTWARD ALONG THE SOUTH LINE OF THE SAID NORTH EAST 1/4 NORTH 86 DEGREES
03 MINUTES 42 SECONDS EAST, A DISTANCE OF 1751.19 FEET TO THE POINT OF
BEGINNING, THENCE NORTH 3 DEGREES 56 MINUTES 18 SECONDS WEST, A DISTANCE OF
83.45 FEET; THENCE NORTH 47 DEGREES 58 MINUTES 24 SECONDS WEST, A DISTANCE
OF 254.55 FEET; THENCE NORTH 33 DEGREES 02 MINUTES 24 SECONDS WEST, A
DISTANCE OF 278.64 FEET; THENCE NORTH 8 DEGREES 26 MINUTES 11 SECONDS EAST,
A DISTANCE OF 334.05 FEET;
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THENCE NORTH 23 DEGREES 37 MINUTES 15 SECONDS WEST, A DISTANCE OF 244.51
FEET; THENCE NORTH 64 DEGREES 50 MINUTES 51 SECONDS WEST, A DISTANCE OF
127.53 FEET; THENCE NORTH 37 DEGREES 44 MINUTES 07 SECONDS WEST, A DISTANCE
OF 95.78 FEET; THENCE NORTH 6 DEGREES 27 MINUTES 08 SECONDS EAST, A
DISTANCE OF 54. 06 FEET; THENCE SOUTH 49 DEGREES 05 MINUTES 46 SECONDS
EAST, A DISTANCE OF 58.496 FEET; THENCE NORTH 87 DEGREES 19 MINUTES 50
SECONDS EAST, A DISTANCE OF 175.00 FEET; THENCE SOUTH 5 DEGREES 02 MINUTES
21 SECONDS EAST, A DISTANCE OF 298.79 FEET; THENCE SOUTH 10 DEGREES 25
MINUTES 51 SECONDS EAST, A DISTANCE OF 447.39 FEET; THENCE SOUTH 42 DEGREES
49 MINUTES 50 SECONDS EAST, A DISTANCE OF 502.73 FEET TO A POINT ON THE
NORTHERLY LINE OF WOODFIELD ROAD AS DEDICATED. AS DOCUMENT NUMBER
22935012; THENCE SOUTH 3 DEGREES 56 MINUTES 18 SECONDS EAST, A DISTANCE OF
50.00 FEET TO A POINT ON THE SOUTH LINE OF SAID NORTH EAST 1/4 OF SECTION
14; THENCE WESTWARD ALONG SAID SOUTH LINE, SOUTH 86 DEGREES 03 MINUTES 42
SECONDS WEST, A DISTANCE OF 150.00 FEET TO THE POINT OF BEGINNING,
EXCEPTING THEREFROM THAT PART DEDICATED FOR ROAD PURPOSES BY PLAT OF
DEDICATION FOR PUBLIC STREET DATED JULY 9, 1974 AND RECORDED DECEMBER 12,
1974 AS DOCUMENT 22935012, ALL IN COOK COUNTY, ILLINOIS
PARCEL 4:
EASEMENT APPURTENANT TO AND FOR THE BENEFIT OF PARCELS 1 AND 2 AS CREATED
AND SET FORTH IN EASEMENT GRANT DATED JUNE 3, 1980 BETWEEN LASALLE NATIONAL
BANK, A NATIONAL BANKING ASSOCIATION, NOT PERSONALLY, BUT AS TRUSTEE UNDER
TRUST AGREEMENT DATED OCTOBER 24, 1978 AND KNOWN AS TRUST NUMBER 100103,
GRANTOR, AND LASALLE NATIONAL BANK, A NATIONAL BANKING ASSOCIATION, NOT
PERSONALLY, BUT AS TRUSTEE UNDER TRUST AGREEMENT DATED OCTOBER 24, 1978 AND
KNOWN AS TRUST NUMBER 100104, GRANTEE, AND RECORDED JULY 14, 1980 IN THE
OFFICE OF THE RECORDER OF DEEDS OF COOK COUNTY, ILLINOIS AS DOCUMENT
25513407 FOR PARKING OF MOTOR VEHICLES AND FOR ACCESS AND INGRESS OVER THE
FOLLOWING DESCRIBED REAL PROPERTY:
THAT PART OF THE NORTH EAST 1/4 OF SECTION 14, TOWNSHIP 41 NORTH, RANGE 10,
EAST OF THE THIRD PRINCIPAL MERIDIAN, DESCRIBED AS FOLLOWS;
COMMENCING AT THE SOUTH WEST CORNER OF THE NORTH EAST 1/4 AFORESAID; THENCE
DUE NORTH ALONG THE WEST LINE OF THE NORTH EAST 1/4 OF SAID SECTION 14, A
DISTANCE OF 50.12 FEET TO A POINT; THENCE NORTH 86 DEGREES, 03 MINUTES, 42
SECONDS EAST ALONG THE NORTHERLY RIGHT-OF-WAY LINE AS WOODFIELD ROAD AND
ITS WESTERLY EXTENSION A DISTANCE OF 924.16 FEET TO A POINT; THENCE NORTH 3
DEGREES, 56 MINUTES, 18 SECONDS WEST A DISTANCE OF 229.00 FEET TO A POINT;
THENCE SOUTH 86 DEGREES, 03 MINUTES, 42 SECONDS WEST A DISTANCE OF 59.00
FEET TO A POINT; THENCE NORTH 3 DEGREES, 56 MINUTES, 18 SECONDS WEST A
DISTANCE OF 60.00 FEET TO THE POINT OF BEGINNING OF THE HEREIN DESCRIBED
PARCEL OF LAND; THENCE CONTINUING NORTH 3 DEGREES, 56 MINUTES, 18 SECONDS
WEST A DISTANCE OF 72.00 FEET TO A POINT; THENCE SOUTH 86 DEGREES, 03
MINUTES, 42 SECONDS WEST ALONG A LINE PERPENDICULAR TO THE LAST DESCRIBED
COURSE, A DISTANCE OF 72.00 FEET TO A POINT; THENCE SOUTH 3 DEGREES, 56
MINUTES, 18 SECONDS EAST, A DISTANCE OF 72.00 FEET TO A POINT; THENCE NORTH
86 DEGREES, 03 MINUTES, 42 SECONDS EAST A DISTANCE OF 72.00 FEET TO THE
HEREINABOVE DESIGNATED POINT OF BEGINNING, ALL IN COOK COUNTY, ILLINOIS.
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