SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of earliest event reported) July 22, 1996
BALCOR REALTY INVESTORS LTD.-82
------------------------------------------------------------
Exact Name of Registrant
Illinois 0-11127
- -------------------------------- --------------------------------
State or other jurisdiction Commission file number
2355 Waukegan Road
Suite A200
Bannockburn, Illinois 36-3139801
- -------------------------------- --------------------------------
Address of principal I.R.S. Employer
executive offices Identification
Number
60015
- --------------------------------
Zip Code
Registrant's telephone number, including area code:
(847) 267-1600
<PAGE>
Item 2. Acquisition or Disposition of Assets
- --------------------------------------------------
a) Eagles Pointe Apartments
In 1982, the Partnership acquired the Eagles Pointe Apartments, Norcross,
Georgia, utilizing approximately $5,305,331 in offering proceeds. The property
was acquired subject to mortgage financing of approximately $8,000,000.
On July 22, 1996, the Partnership contracted to sell the property for a sale
price of $11,075,000 to an unaffiliated party, TGM Realty Corp. #5 (the
"Purchaser"), a Delaware corporation. The Purchaser has deposited $300,000
into an escrow account as earnest money and will pay the remaining $10,775,000
at closing, which is scheduled for October 1, 1996. From the proceeds of the
sale, the Partnership will repay the existing mortgage financing which is
expected to have an outstanding balance of $7,067,753 at closing, and $161,125
to an unaffiliated party as a brokerage commission. An affiliate of the third
party providing property management services for the property will receive a
fee of $110,750 for services rendered in connection with the sale. The
Partnership will receive approximately $3,735,372 in remaining proceeds, less
closing costs. An amount not to exceed $225,000 will be retained by the
Partnership and will not be available for use or distribution by the
Partnership until 90 days after the closing. Neither the General Partner nor
any affiliate will receive a brokerage commission in connection with the sale
of the property. The General Partner will be reimbursed by the Partnership for
actual expenses incurred in connection with the sale.
Affiliates of the General Partner have recently sold or contracted to sell 4
other properties to the Purchaser.
The closing is subject to the satisfaction of numerous terms and conditions.
There can be no assurance that all of the terms and conditions will be complied
with and, therefore, it is possible the sale of the property may not occur.
b) Songbird Apartments, Phase I and Phase II
In 1982, the Partnership acquired the Songbird Apartments, Phase I and Phase II
(together, the "Property"), San Antonio, Texas, utilizing approximately
$5,641,310 in offering proceeds. The Property was acquired subject to first
mortgage financing of approximately $8,080,000. In 1988 the first mortgage
financing was refinanced with a new $5,920,000 first mortgage loan (the "Loan")
from an unaffiliated party and a $2,040,725 loan from the General Partner
("Affiliate Loan"). In 1993, the Loan was refinanced with a new first mortgage
loan in the amount of $7,325,000 from an unaffiliated party. In 1994, the
Affiliate Loan was repaid from Partnership funds.
On July 22, 1996, the Partnership contracted to sell the Property for a sale
price of $11,000,000 to an unaffiliated party, ERP Operating Limited
Partnership (the "Purchaser"), an Illinois limited partnership. The Purchaser
has deposited $300,000 into an escrow account as earnest money, and an
additional $200,000 is required to be deposited on August 15, 1996. The
Purchaser expects to assume the existing mortgage loan, which is expected to
have an outstanding balance of $7,015,499 at closing, scheduled for August 30,
<PAGE>
1996. The remainder of the purchase price will be paid in cash at closing.
From the proceeds of the sale, the Partnership will pay $220,000 to an
unaffiliated party as a brokerage commission and a fee of $110,000 to an
affiliate of the third party providing property management services for the
Property for services rendered in connection with the sale and will receive
approximately $3,654,501 in remaining proceeds, less closing costs. An amount
not to exceed $500,000 will be retained by the Partnership and will not be
available for use or distribution by the Partnership until 120 days after the
closing. Neither the General Partner nor any affiliate will receive a
brokerage commission in connection with the sale of the Property. The General
Partner will be reimbursed by the Partnership for actual expenses incurred in
connection with the sale.
Affiliates of the General Partner have recently sold or contracted to sell 25
other properties to the Purchaser.
The closing is subject to the satisfaction of numerous terms and conditions,
including the lender's consent to the assumption of the existing mortgage loan
by the Purchaser. If the lender's consent is not received on or before August
30, 1996, the agreement of sale may be terminated. There can be no assurance
that all of the terms and conditions will be complied with and, therefore, it
is possible the sale of the Property may not occur.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
- ----------------------------------------------------------------------
(a) FINANCIAL STATEMENTS AND EXHIBITS:
None
(B) PRO FORMA FINANCIAL INFORMATION:
None
(C) EXHIBITS:
(2) (a) Agreement of Sale and attachments thereto relating to the
sale of the Eagles Pointe Apartments, Norcross, Georgia.
(b) Agreement of Sale and attachments thereto relating to the
sale of the Songbird Apartments, Phase I and Phase II, San
Antonio, Texas.
No information is required under Items 1, 3, 4, 5, 6 and 8 and these items
have, therefore, been omitted.
<PAGE>
Signature
- -------------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned hereunto duly authorized.
BALCOR REALTY INVESTORS LTD.-82
By: Balcor Partners-XI, an Illinois
general partnership, its general partner
By: RGF-Balcor Associates-II, an
Illinois general partnership, a partner
By: The Balcor Company, a Delaware corporation,
a partner
By: /s/ Jerry M. Ogle
------------------------------------
Jerry M. Ogle, Vice President
and Secretary
Dated: August 5, 1996
<PAGE>
[Eagles Pointe]
AGREEMENT OF SALE
THIS AGREEMENT, entered into as of the 19th day of July, 1996, by and
between TGM Realty Corp. #5, a Delaware corporation ("Purchaser") and Balcor
Realty Investors Ltd.-82, an Illinois limited partnership ("Seller").
WITNESSETH:
1. PURCHASE AND SALE. Purchaser agrees to purchase and Seller agrees to
sell at the price (the "Purchase Price") of Eleven Million Seventy-Five
Thousand and No/100 Dollars ($11,075,000.00), all of the following property
(collectively, the "Property"):
A. That certain parcel of real property commonly known as Eagles
Pointe Apartments, Atlanta, Georgia, more particularly described on Exhibit A
attached hereto (the "Land");
B. All equipment, furnishings and other tangible personal property
owned by Seller placed or installed on or about the Land or Improvements now or
prior to "Closing" (as such term is defined in Section 8 hereof) and used as
part of or in connection with the Land and Improvements, including, the
personal property set forth on Exhibit B but excluding any computer hardware
and software (other than computer discs containing data files) (collectively,
the "Personal Property"), which Personal Property shall be transferred to
Purchaser at Closing by a Bill of Sale in the form of Exhibit F attached
hereto;
C. All rights and appurtenances pertaining to the Land, including,
without limitation, any and all rights of Seller in and to all air and
development rights, roads, alleys, easements, streets and ways adjacent to the
Land, rights of ingress and egress thereto, any strips and gores within or
bounding the Land and profits or rights or appurtenances pertaining to the
Land;
D. The buildings and all other improvements, structures and
fixtures placed, constructed or installed on the Land (collectively, the
"Improvements");
E. All leases, licenses and other occupancy agreements
(collectively, the "Leases") covering space situate at or within the Land and
Improvements and any claim or right to claim against a tenant or occupant
(collectively, the "Tenants") under any existing Lease and all security
deposits paid or deposited by Tenants in respect of the Leases;
F. All of Seller's rights in and contractual rights and intangibles
with respect to the operation, maintenance and repair of the Land and
Improvements, including service and maintenance agreements, construction,
material and labor contracts, utility agreements and other contractual
arrangements, all to the extent designated by the provisions of this Agreement
(collectively, the "Contracts"); assignable governmental permits, licenses,
certificates and approvals in connection with the ownership of the Property
<PAGE>
(collectively, the "Licenses") and warranties of any contractor, manufacturer
or materialman;
G. Seller's right, if any, to the use of the trade name "Eagles
Pointe Apartments" (the "Trade Name") in connection with the Property;
H. The right, if assignable, to the use of all telephone numbers
used by Seller at the Property; and
I. All rights to any award made or to be made or settlement in lieu
thereof for damage to the Land or Improvements by reason of condemnation,
eminent domain, exercise of police power or change of grade of any street in
accordance with the terms herein.
2. PURCHASE PRICE. The Purchase Price shall be paid as follows:
A. Within one (1) "Business Day" (as hereinafter defined) following
the Purchaser's execution of this Agreement, the sum of $300,000 (said sum,
together with all interest accrued thereon, is herein called the "Earnest
Money") payable to the "Escrow Agent" (as defined in the Escrow Agreement) to
be held in escrow by and in accordance with the provisions of the Escrow
Agreement ("Escrow Agreement") attached hereto as Exhibit C;
B. On the "Closing Date" (as hereinafter defined), the balance of
the Purchase Price, adjusted in accordance with the prorations by federally
wired "immediately available" funds to the Escrow Agent's account prior to
11:00 A.M. Eastern Time.
3. TITLE COMMITMENT AND SURVEY.
A. Seller has delivered to Purchaser a title commitment ("Title
Commitment") for an ALTA Owner's Policy (10/17/92) with extended coverage
("Title Policy") issued by Commonwealth Land Title Insurance Company ("Title
Insurer"). In addition, Seller has delivered to Purchaser copies of all items
and documents referred to in the Title Commitment (collectively, the "Backup
Documents"). The Title Policy issued to Purchaser at Closing will be in the
amount of the Purchase Price subject only to the "Permitted Exceptions" (as
hereinafter defined). On the Closing Date, Seller shall cause the Title
Insurer to issue to Purchaser the Title Policy or a "marked up" commitment in
conformity with the requirements in this Agreement for the Title Policy. The
costs of the Title Policy will be paid pursuant to Paragraph 5 of this
Agreement.
B. Purchaser acknowledges receipt of a survey ("Survey") of the
Land and the Improvements prepared by Travis Pruitt & Associates, P.C (the
"Surveyor"). Prior to the Closing, Seller will have the Survey certified to
Purchaser or its designee and the Title Insurer, which certificate shall be in
a form agreed to by Purchaser and the Surveyor prior to the expiration of the
Inspection Period. All costs relating to recertifying the Survey will be paid
pursuant to Paragraph 5 of this Agreement.
<PAGE>
C. Purchaser shall have until the "Inspection Period Expiration
Date" (as hereinafter defined) to examine the condition of title and the Survey
and to approve or disapprove the same, including, without limitation,
determining whether Purchaser is satisfied with: (a) the title endorsements
which the Title Insurer will make available to Purchaser; and (b) the
certificate from the Surveyor on the Survey. If Purchaser shall disapprove the
condition of title or the Survey, such disapproval shall be set forth in one or
more notices (each, a "Disapproval Notice") given to Seller not later than the
Inspection Period Expiration Date stating that the condition of title to the
Property or of the Survey or any of the terms, provisions or contents of the
items and documents described in Paragraphs 3A and 3B hereto are disapproved by
Purchaser. If Purchaser fails to deliver a Disapproval Notice, Purchaser shall
be presumed to have accepted the condition of title and the Survey in the
condition set forth in the most recent Title Commitment and Survey that shall
have been delivered to Alan Linder on or before the date which is three (3)
Business Days before the Inspection Period Expiration Date. Notwithstanding
the foregoing, Purchaser may deliver one or more additional Disapproval Notices
after the Inspection Period Expiration Date, if at any time after the date
which is three (3) Business Days prior to the Inspection Period Expiration
Date, Alan Linder receives (i) an amendment or revision to the Title Commitment
or the Survey containing any exception or Survey item not set forth in a
previous Title Commitment or Survey, or (ii) a Backup Document not previously
delivered to Alan Linder, provided that any such additional Disapproval Notice
shall be given, if at all, within three (3) Business Days after Alan Linder
receives such amendment, revision or additional Backup Document, as the case
may be. If necessary, the Closing shall be adjourned to provide Purchaser such
three (3) Business Day period. Seller shall have until the date which is five
(5) Business Days after the date of the Disapproval Notice (the "Title Cure
Expiration Date") in which to cure, eliminate or agree to cure or eliminate all
items which Purchaser disapproves in the Disapproval Notice, and to furnish
evidence satisfactory to Purchaser and the Title Insurer or the Surveyor,
respectively, that all such items have been cured or eliminated or that
arrangements have been made with the Title Insurer or the Surveyor,
respectively, and any parties in interest to cure or eliminate the same at or
prior to the later of: (a) Closing, or (b) five (5) Business Days following the
Title Cure Expiration Date, in which case, if necessary, the Closing Date shall
be extended to the first date on which the lender financing the Property will
accept a prepayment of the loan secured by the Property, but in no event shall
the Closing Date be extended by more than thirty (30) days therefor. If such
evidence is not received by Purchaser and the Title Insurer or the Surveyor,
respectively, on or before the Title Cure Expiration Date (all exceptions to
title or Survey items set forth in any and all Disapproval Notices are herein
called "Unpermitted Exceptions", and all exceptions to title and all Survey
items that are not Unpermitted Exceptions are herein called "Permitted
Exceptions"), then Purchaser shall have the right to elect to terminate this
Agreement, by written notice delivered on or before the Closing (the
"Termination Notice") and, upon such election, all Earnest Money shall be
immediately refunded to Purchaser, and thereupon the parties hereto shall have
no further obligations one to the other under this Agreement. If Purchaser
fails to deliver the Termination Notice as described above, the Purchaser shall
be deemed to have accepted title and Survey subject to the Unpermitted
Exceptions.
<PAGE>
Notwithstanding anything contained herein to the contrary, if there shall
be any Unpermitted Exceptions which (i) are, or were caused by, resulted from
or arose out of (a) a default by Seller of any of its obligations under this
Agreement, including but not limited to Seller's failure to pay real estate
taxes, or (b) any debt of Seller secured by the Property including, but not
limited to the grant by Seller to any person or entity of a mortgage, deed of
trust or other security interest affecting the Property; (c) any judgments
which are a lien against the Property; (d) any materialman's or mechanic's lien
(or similar lien) recorded against the Property, then, for a period of sixty
(60) days, Seller shall take all such actions as may be necessary (including,
without limitation, the commencement of and the diligent prosecution of legal
proceedings and the payment of money) to remove such Unpermitted Exceptions, or
cause the Title Insurer to issue a title indemnity to Purchaser in form and
substance reasonably satisfactory to Purchaser, insuring against loss or
damage; or (ii) are not of the type described in clause (i) of this sentence,
but are removable by the payment of a definite or ascertainable sum not to
exceed, in the aggregate, $25,000.00 (hereinafter referred to as the "Maximum
Amount"), then Seller shall cause such Unpermitted Exceptions to be removed
from the Title Commitment and the Title Policy, or cause the Title Insurer to
issue a title indemnity to Purchaser in form and substance reasonably
satisfactory to Purchaser, insuring against loss or damage. If Seller fails to
remove any Unpermitted Exceptions in accordance with the provisions of this
paragraph or if there exists any Unpermitted Exception which Seller is not
obligated to remove pursuant to clause (ii) above because payment of funds in
excess of the Maximum Amount would be required to cure the same, Purchaser,
nevertheless, may elect (at or prior to the Closing) to consummate the
transaction provided for herein subject to any such Unpermitted Exception as
may exist as of the Closing with a credit against the Purchase Price equal to
(a) the sum necessary to remove such Unpermitted Exceptions which can be
satisfied by a liquidated amount, and (b) the reasonably estimated reduction in
the fair market value of the Property resulting from any Unpermitted Exceptions
which cannot be satisfied by the payment of a liquidated amount (not to exceed
the Maximum Amount solely for Unpermitted Exceptions of the type described in
clause (ii) above; provided, however, if Purchaser makes such election,
Purchaser shall not be entitled to any other credit, nor shall Seller bear any
further liability, with respect to any Unpermitted Exceptions of the type
described in clause (ii) above). If Purchaser shall not so elect, Purchaser
shall be deemed to have elected to terminate this Agreement, in which case, the
Earnest Money plus all accrued interest shall be delivered to Purchaser and,
subject to the survival provisions of Paragraphs 15 and 16 herein, neither
party shall have any further liability hereunder.
4. CONDITION OF TITLE/CONVEYANCE. Seller agrees to convey fee simple
title to the Property by Special Warranty Deed ("Deed") in the form of Exhibit
D attached hereto and in recordable form subject only to the Permitted
Exceptions.
5. PAYMENT OF CLOSING COSTS. Purchaser and Seller shall each pay
one-half (1/2) of all costs related to the Title Commitment and the Title
Policy (including without limitation premium, title search fees, the costs of
extended coverage on the Title Policy and the costs of those endorsements
identified on Exhibit E attached hereto [Purchaser shall be responsible to pay
<PAGE>
for any additional endorsements]), the Survey (including the recertifying of
the Survey), the Title Insurer's escrow fees not to exceed $550, transfer
taxes, if any, recording charges for the Deed, and the cost of the "UCC Search"
(as hereinafter defined) (collectively, "Closing Costs"). Notwithstanding the
aforesaid, each party hereunder shall pay its own attorneys' fees.
6. DAMAGE, CASUALTY AND CONDEMNATION.
A. If the Property suffers damage as a result of any casualty prior
to the Closing Date and can be repaired or restored for $200,000 or less, then
Purchaser shall accept the Property in its damaged condition together with a
credit at Closing in the amount of the damaged Property. If the Property
suffers damage as a result of any casualty prior to the Closing Date and cannot
be repaired or restored for $200,000 or less, then, at Purchaser's election to
be exercised within ten (10) days after Purchaser is notified of such casualty,
this Agreement shall be terminated.
B. If condemnation proceedings ("Proceedings") have been instituted
against the Property or any governmental authority shall take any steps
preliminary thereto (by the giving of a written notice of intent to institute
such proceedings), then Purchaser can elect to either take the Property subject
to the Proceedings and an assignment of Seller's interest in the Proceedings or
terminate this Agreement. If Purchaser elects to terminate this Agreement, it
shall be by notice to Seller within ten (10) days after Seller notifies
Purchaser of the Proceedings.
C. If this Agreement is terminated pursuant to Paragraphs 6a or 6b
hereof, then all Earnest Money plus the interest accrued thereon shall be
returned to Purchaser and, subject to the survival provisions of Paragraphs 15
and 16 herein, neither party shall have any further liability hereunder.
7. AS-IS CONDITION.
A. Except as specifically set forth otherwise in this Agreement,
Purchaser acknowledges and agrees that it will be purchasing the Property based
solely upon its inspection and investigations of the Property and that
Purchaser will be purchasing the Property "AS IS" and "WITH ALL FAULTS" based
upon the condition of the Property as of the last day of Purchaser's inspection
of the Property, subject to reasonable wear and tear from such date until the
Closing Date. Without limiting the foregoing, Purchaser acknowledges that,
except as may otherwise be specifically set forth elsewhere in this Agreement,
neither Seller nor its consultants or agents have made any other
representations or warranties of any kind upon which Purchaser is relying as to
any matters concerning the Property, including, but not limited to, the
condition of the Land or any Improvements, the existence or nonexistence of
asbestos, toxic waste or any hazardous material, the Tenants of the Property or
the Leases affecting the Property, economic projections or market studies
concerning the Property, any development rights, taxes, bonds, covenants,
conditions and restrictions affecting the Property, water or water rights,
topography, drainage, soil, subsoil of the Property, the utilities serving the
Property or any zoning, environmental or building laws, rules or regulations
affecting the Property. Seller makes no representation that the Property
<PAGE>
complies with Title III of the Americans With Disabilities Act or any fire
codes or building codes. Purchaser hereby releases Seller from any and all
liability in connection with any claims which Purchaser may have against
Seller, and Purchaser hereby agrees not to assert any claims, for contribution,
cost recovery or otherwise, against Seller, relating directly or indirectly to
the existence of asbestos or hazardous materials or substances on, or
environmental conditions of, the Property, provided that nothing in this
Section 7 shall constitute a release of Seller with respect to any
representations or warranties expressly set forth in this Agreement. As used
herein, the term "Hazardous Materials" or "Hazardous Substances" means (i)
hazardous wastes, hazardous substances, hazardous constituents, toxic
substances or related materials, whether solids, liquids or gases, including
but not limited to substances defined as "hazardous wastes," "hazardous
substances," "toxic substances," "pollutants," "contaminants," "radioactive
materials," or other similar designations in, or otherwise subject to
regulation under, the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended ("CERCLA"), 42 U.S.C. Section 9601 et seq.;
the Toxic Substance Control Act ("TSCA"), 15 U.S.C. Section 2601 et seq.; the
Hazardous Materials Transportation Act, 49 U.S.C. Section 1802; the Resource
Conservation and Recovery Act ("RCRA"), 42 U.S.C. Section 9601, et seq.; the
Clean Water Act ("CWA"), 33 U.S.C. Section 1251 et seq.; the Safe Drinking
Water Act, 42 U.S.C. Section 300f et seq.; the Clean Air Act ("CAA"), 42 U.S.C.
Section 7401 et seq.; and in any permits, licenses, approvals, plans, rules,
regulations or ordinances adopted, or other criteria and guidelines promulgated
pursuant to the preceding laws or other similar federal, state or local laws,
regulations, rules or ordinance now or hereafter in effect relating to
environmental matters (collectively the "Environmental Laws"); and (ii) any
other substances, constituents or wastes subject to any applicable federal,
state or local law, regulation or ordinance, including any Environmental Law,
now or hereafter in effect, including but not limited to (A) petroleum, (B)
refined petroleum products, (C) waste oil, (D) waste aviation or motor vehicle
fuel and (E) asbestos.
B. If the Property suffers damage from a casualty prior to the
Closing Date, but is discovered by Purchaser within 90 days after the Closing
Date, then Seller shall promptly file a claim with its insurance carrier and
will assign the proceeds of that claim to Purchaser and pay Purchaser the
amount of the deductible on its policy.
C. Seller has provided to Purchaser certain unaudited historical
financial information regarding the Property relating to certain periods of
time in which Seller owned the Property. Seller and Purchaser hereby
acknowledge that such information has been provided to Purchaser at Purchaser's
request solely as illustrative material. Seller makes no representation or
warranty that such material is complete or accurate or that Purchaser will
achieve similar financial or other results with respect to the operations of
the Property, it being acknowledged by Purchaser that Seller's operation of the
Property and allocations of revenues or expenses may be vastly different than
Purchaser may be able to attain. Purchaser acknowledges that it is a
sophisticated and experienced purchaser of real estate and further that
Purchaser will rely upon its own investigation and inquiry with respect to the
operation of the Property and releases Seller from any liability with respect
to such historical information.
<PAGE>
8. CLOSING. The closing ("Closing") of this transaction shall be on
October 1, 1996 or on such other date mutually agreed upon by the parties
("Closing Date"), at which time Seller shall deliver possession of the Property
to Purchaser in accordance with this Agreement. Closing shall occur at the
offices of Purchaser's counsel. The parties acknowledge and agree the Closing
will be a "New York Style" Closing such that Seller will receive the Purchase
Price on the Closing Date upon (i) Seller's unconditional delivery of the
documents set forth in Paragraph 9(b) herein, and (ii) the Title Insurer's
delivery to Purchaser of the Title Policy or a "marked-up" commitment in
conformity with the requirements in this Agreement for the Title Policy.
9. CLOSING DOCUMENTS.
A. On the Closing Date, Purchaser shall deliver to Seller an
executed closing statement prepared by the Title Insurer and approved by
Purchaser, the Assignment and Assumption of Service Contracts in the form of
Exhibit G attached hereto, the Assignment and Assumption of Leases in the form
of Exhibit H attached hereto, the notice to the Tenants in the form of Exhibit
I attached hereto, the Post-Closing Adjustment Letter in the form of Exhibit J
attached hereto, the balance of the Purchase Price (after crediting the Earnest
Money), and such other documents as may be reasonably required by the Title
Insurer in order to consummate the transaction as set forth in this Agreement.
B. On the Closing Date, Seller shall deliver to Purchaser
possession of the Property in accordance with this Agreement; and duplicate
originals of all of the following: the Deed (in the form of Exhibit D attached
hereto) subject only to the Permitted Exceptions and those Unpermitted
Exceptions waived in writing by Purchaser, if any, which Deed shall contain the
legal description in conformity with the legal description shown on the final
Survey; an inventory of the Personal Property which shall include all Personal
Property set forth on Exhibit B and a Bill of Sale for the same (in the form of
Exhibit F attached hereto); an executed closing statement prepared by the Title
Insurer and approved by Purchaser; an executed Assignment and Assumption of
Service Contracts (in the form of Exhibit G attached hereto) together with
originals (or copies if originals are not in Seller's possession) of all
instruments evidencing the rights assigned; an executed Assignment and
Assumption of Leases (in the form of Exhibit H attached hereto) together with
originals of all Leases assigned (which Leases will be at the managing agent's
office at the Property); an updated rent roll certified by Seller to be
correct; a notice to the Tenants of the transfer of title (in the form of
Exhibit I attached hereto, which notice shall be delivered to the Tenants by
Purchaser); a non-foreign affidavit (in the form of Exhibit K attached hereto);
the Post-Closing Adjustment Letter dated as of the Closing Date (in the form of
Exhibit J annexed hereto); an assignment of intangibles (in the form of Exhibit
L annexed hereto); an assignment of the Licenses (in the form of Exhibit M
annexed hereto), together with originals or copies of originals which are not
in Seller's possession, of all instruments evidencing the rights assigned; an
assignment of all existing assignable warranties and guarantees (the
"Assignment of Warranties and Guarantees") relating to the Property dated as of
the Closing Date (in the form of Exhibit N annexed hereto), together with
available originals or copies if originals are not in Seller's possession, of
all instruments evidencing the rights assigned, the Information for Real Estate
<PAGE>
1099-S Report Filing (in the form of Exhibit O annexed hereto); an
acknowledgement of receipt of the Information for Real Estate 1099-S Report
Filing by the Title Insurer (in the form of Exhibit P attached hereto);
evidence acceptable to the Title Insurer, authorizing the consummation by
Seller of the transaction which is the subject of this Agreement and the
execution and delivery of all documents on behalf of Seller; all keys and
combinations to all locks on the Improvements which will be at the Property;
all plans, specifications, mechanical, electrical and plumbing layouts,
operating manuals, purchase orders, brochures, marketing materials and
advertisements which are owned by Seller and are located at the Property,
Tenant lease files, and other files and records in the possession of Seller at
the leasing office at the Property and Seller's managing agent (including,
without limitation, hard copy print outs of the information contained on the
computer data discs delivered to Purchaser at Closing) and utilized in
connection with the operation and maintenance of the Land and Improvements;
current tax bills and, if available, to the extent in Seller's possession, tax
bills for each of the years of Seller's ownership of the Property an instrument
assigning to Purchaser any reduction or refund of real or personal property
taxes assessed against any portion of the Property for the fiscal year in which
the Closing takes place (it being agreed that any reduction or refund for such
year shall be prorated when received) and for subsequent years; affidavits and
certificates as to facts within the knowledge of Seller as required by the
Title Insurer as to the condition of title or the due performance by Seller of
its obligations under this Agreement, the Title Policy or the "marked-up"
commitment for the Title Policy in conformity with the requirements in this
Agreement; UCC searches conducted by a UCC search company reasonably acceptable
to Purchaser at the County and State level, searching Seller's name, the name
of any other entity which may have owned the Property during the past five (5)
years and the Trade Name, dated to a date not more than thirty (30) days prior
to the Closing evidencing that no portion of the Personal Property is subject
to any UCC filing (the "UCC Search") unless a UCC-3 Termination Statement for
same has been provided for at the Closing; telephone transfer form; and such
other documents as may be reasonably required by the Title Insurer in order to
consummate the transaction as set forth in this Agreement.
C. Seller shall deliver to Alan Linder, not less than five (5) days
prior to the Closing Date, execution originals of all of the conveyance
documents which are to be executed by Purchaser.
10. DEFAULT BY PURCHASER. ALL EARNEST MONEY DEPOSITED INTO THE ESCROW IS
TO SECURE THE TIMELY PERFORMANCE BY PURCHASER OF ITS OBLIGATIONS AND
UNDERTAKINGS UNDER THIS AGREEMENT, INCLUDING ITS OBLIGATIONS TO MAKE ALL
DEPOSITS ON OR BEFORE THE DATES PROVIDED FOR HEREIN. IN THE EVENT THE CLOSING
DOES NOT OCCUR AS A RESULT OF ANY DEFAULT OF PURCHASER UNDER THE PROVISIONS OF
THIS AGREEMENT, SELLER SHALL RETAIN ALL OF THE EARNEST MONEY AND THE INTEREST
THEREON AS LIQUIDATED DAMAGES, AND AS SELLER'S SOLE RIGHT TO DAMAGES OR ANY
OTHER REMEDY. THE PARTIES HAVE AGREED THAT SELLER'S ACTUAL DAMAGES, IN THE
EVENT OF A DEFAULT BY PURCHASER, WOULD BE EXTREMELY DIFFICULT OR IMPRACTICAL TO
DETERMINE. THEREFORE, BY PLACING THEIR INITIALS BELOW, THE PARTIES ACKNOWLEDGE
THAT THE EARNEST MONEY HAS BEEN AGREED UPON, AFTER NEGOTIATION, AS THE PARTIES'
REASONABLE ESTIMATE OF SELLER'S DAMAGES.
<PAGE>
11. SELLER'S DEFAULT. IF THIS SALE IS NOT COMPLETED BECAUSE OF SELLER'S
INABILITY TO PERFORM ITS OBLIGATIONS UNDER THIS AGREEMENT, PURCHASER' S SOLE
REMEDY SHALL BE THE RETURN OF ALL EARNEST MONEY TOGETHER WITH ANY INTEREST
ACCRUED THEREON, PLUS ACTUAL DAMAGES NOT TO EXCEED $150,000.00, AND, SUBJECT TO
THE SURVIVAL PROVISIONS OF PARAGRAPHS 15 AND 16 HEREIN, THIS AGREEMENT SHALL
TERMINATE AND THE PARTIES SHALL HAVE NO FURTHER LIABILITY TO EACH OTHER AT LAW
OR IN EQUITY. NOTWITHSTANDING ANYTHING CONTAINED HEREIN TO THE CONTRARY, IF
SELLER'S DEFAULT IS ITS REFUSAL TO DELIVER THE DEED OR ANY OF THE OTHER
DOCUMENTS ENUMERATED IN PARAGRAPH 9(b) OF THIS AGREEMENT, THEN PURCHASER WILL
BE ENTITLED TO SUE FOR SPECIFIC PERFORMANCE.
12. PRORATIONS. The following are to be prorated or adjusted (as
appropriate), as of 11:59 P.M. on the day preceding the Closing Date (the
"Proration Date"):
A. Rents, as and when collected. If as of the Proration Date there
are rents owed by Tenants for the month in which the Closing occurs, then the
first monies received from said Tenant or Tenants shall be received on account
of or in payment of such past due rents and (i) if Purchaser receives said past
due rents, Seller's aforesaid share thereof shall be remitted by Purchaser to
Seller within three (3) Business Days, and (ii) if Seller receives such past
due rents, Purchaser's aforesaid share thereof shall be remitted by Seller to
Purchaser within three (3) Business Days. With respect to any arrears for
periods prior to the month in which the Closing occurs, Purchaser shall pay
such arrears to Seller as and when collected from the monies received from such
Tenant provided such Tenant is otherwise current in its rent. With respect to
rents for any period subsequent to the month in which the Closing occurs that
may be received by Seller, Seller shall promptly remit such rents to Purchaser.
B. Real estate and personal property taxes, if any, on the basis of
the fiscal year for which assessed and in which the Proration Date occurs. If
the Closing shall occur before the tax rate or assessment is fixed for the
fiscal year in which the Closing occurs, then the apportionment of such real
estate and personal property taxes at the Closing shall be upon the basis of
103% of the most recent available tax bill. Seller has advised Purchaser that
Seller is contesting the 1996 assessed value of the Property. Seller hereby
retains the rights to continue to pursue such contest. Any tax savings which
are applicable to the period of time prior to Closing shall be the property of
Seller. Any tax savings which are applicable to the period of time from and
after the Closing shall be the property of Purchaser. If the contest results
in a reduced 1996 assessed value for the Property, Purchaser shall promptly
remit to Seller the difference between the tax credit given to Purchaser for
1996 real estate taxes at Closing and the amount the credit would have been
based on the new reduced assessed value for the Property. Seller covenants
that Purchaser shall have no responsibility to pay any portion of the fees or
expenses of Seller's tax protest consultant and that no such fees or expenses
shall be deducted from any tax credit or refund applicable to the period of
time from and after the Closing. Purchaser shall not be obliged to assume
such consultant's contract with Seller, at Closing or at any other time.
C. Water, sewer charges, electricity and gas on the basis of the
most recent bills available, but if there are meters on the Property, Seller,
to the extent the same is obtainable, shall obtain a reading effective as of
the Proration Date.
<PAGE>
D. Tax and utility company deposits, if any, and if assignable and
assigned.
E. Fuel, if any, based on a fuel company letter showing measurement
no more than two (2) days prior to Closing and valued at current prices.
F. Amounts paid or payable in respect of any Contracts assigned to
Purchaser, including, but not limited to, any up-front "bonus" payments made in
consideration of entering into any Contract, net of any commissions paid by
Seller (which up-front "bonus" payments, if any, shall be prorated based upon
the unexpired term of the Contract; provided, however, such bonus payments
shall only be prorated if actually received by Seller and only to the extent
any fee was not used to improve the applicable facilities at the Property
related to the applicable contract);
G. Purchaser shall receive a credit against the cash due at Closing
in an amount equal to all refundable Tenants security deposits and accrued
interest to which Tenants may be entitled pursuant to the Leases which are to
be assigned to Purchaser at the time of Closing.
H. If, at Closing, the Property or any part thereof shall be or
shall have been affected by an assessment or assessments which are or may
become payable in installments, then for purposes of this Agreement, all unpaid
installments of any such assessment, including those which are to become due
and payable and to be liens upon the Property shall be paid and discharged by
Purchaser. In addition, the parties agree to prorate any prepaid assessments
at Closing.
I. If such prorations result in a payment due Purchaser, then the
portion of the Purchase Price payable at Closing shall be reduced by such sum.
J. If such prorations result in a payment due Seller, then the same
shall be paid to Seller in addition to the portion of the Purchase Price
payable at Closing.
K. The parties hereto shall endeavor to prepare a schedule of
prorations no less than one (1) Business Day prior to Closing.
L. The parties hereto shall correct any arithmetic errors in
prorations as soon after the Closing as amounts are finally determined. The
parties hereto shall enter into the Post-Closing Adjustment Letter at the
Closing in the form of Exhibit J annexed hereto.
M. Except as set forth in Paragraph 12(b) hereof, if the amount of
any of the items to be prorated is not then ascertainable, the adjustment
thereof shall be on the basis of the most recent ascertainable data. Except
with reference to arithmetic errors, all prorations will be final.
N. The provisions of this Paragraph 12 shall survive the Closing.
13. RECORDING. This Agreement shall not be recorded and the act of
recording by Purchaser shall be an act of default hereunder by Purchaser and
shall be subject to the provisions of Paragraph 10.
<PAGE>
14. ASSIGNMENT. Purchaser shall have the right to assign its interest in
this Agreement, provided such assignment is effected at least five (5) days
prior to the Closing Date. In the event of any such assignment, Seller agrees
to deliver any documents referred to in this Agreement to Purchaser's designee
and agrees that all surviving representations and warranties of Seller
hereunder shall be deemed to run in favor of, and be enforceable by said
designee as if it were Purchaser hereunder. Upon any assignment, Purchaser
agrees that it shall continue to be bound by all of Purchaser's indemnities
under this Agreement. The provisions of this Paragraph shall survive the
Closing.
15. BROKER. The parties hereto acknowledge that Apartment Realty
Advisors ("Broker") is the only real estate broker involved in this
transaction. Purchaser has not paid and will not pay at any time before, at or
after the Closing, any fee, commission or compensation whatsoever to any person
whomsoever directly or indirectly on account of this Agreement, its
negotiation, or the sale hereby contemplated. Seller agrees to pay Broker a
commission or fee ("Fee") pursuant to a listing agreement between Seller and
Broker. Seller represents that this Fee is due and payable only from the
proceeds of the Purchase Price received by Seller. Purchaser agrees to
indemnify, defend and hold harmless Seller and any partner, affiliate, parent
of Seller, and all shareholders, employees, officers and directors of Seller or
Seller's partner, parent or affiliate (each of the above is individually
referred to as a "Seller Indemnitee") from all claims, including attorneys'
fees and costs incurred by a Seller Indemnitee as a result of anyone (other
than Broker) claiming by or through Purchaser, as a result of Purchaser's
actions, any fee, commission or compensation on account of this Agreement, its
negotiation or the sale hereby contemplated. Purchaser does now and shall at
all times consent to a Seller Indemnitee's reasonable approval of defense
counsel selected by Purchaser. Seller agrees to indemnify, defend and hold
harmless Purchaser and all shareholders, employees, officers and directors of
Purchaser or Purchaser's parent or affiliate (each of the above is individually
referred to as a "Purchaser Indemnitee") from all claims, including attorneys'
fees and costs incurred by a Purchaser Indemnitee as a result of anyone
claiming by or through Seller, as a result of Seller's actions, including but
not limited to Broker, any fee, commission or compensation on account of this
Agreement, its negotiation or the sale hereby contemplated. Seller does now
and shall at all times consent to a Purchaser Indemnitee's reasonable selection
of defense counsel. The provisions of this Paragraph will survive the Closing
and delivery of the Deed and any prior termination of this Agreement.
16. INSPECTION OF PROPERTY.
A. During the period (the "Inspection Period") commencing on the
date hereof and ending at 5:00 p.m. Chicago time on August 26, 1996 (said date
of expiration of the Inspection Period being referred to herein as the
"Inspection Period Expiration Date"), Purchaser and the agents, engineers,
employees, contractors and surveyors retained by Purchaser may enter upon the
Property, at any reasonable time and upon reasonable prior notice to Seller, to
inspect the Property, including a review at the Property of the Leases and to
conduct and prepare such studies, tests and surveys as Purchaser may deem
reasonably necessary and appropriate. In connection with Purchaser's review of
<PAGE>
the Property, Seller agrees to deliver to Purchaser copies of the current rent
roll for the Property, the most recent tax and insurance bills, utility account
numbers, service contracts and unaudited year end 1994 and 1995 operating
statements. During the Inspection Period, Seller will reasonably cooperate
with Purchaser in its inspection of the Property including, but not limited to,
furnishing (or making available) to Purchaser such information, materials and
documents which Purchaser may reasonably request and which are in Seller's
possession.
B. Except as set forth in Section 5 hereof, all of the foregoing
tests, investigations and studies to be conducted under this Paragraph 16 by
Purchaser shall be at Purchaser's sole cost and expense, and Purchaser shall
restore the Property substantially to the condition existing prior to the
performance of such tests or investigations by or on behalf of Purchaser.
Purchaser shall defend, indemnify and hold Seller and any affiliate, parent of
Seller, and all shareholders, employees, officers and directors of Seller or
Seller's affiliate or parent (hereinafter collectively referred to as
"Affiliate of Seller") harmless from any and all liability, cost and expense
(including without limitation, reasonable attorney's fees, court costs and
costs of appeal) suffered or incurred by Seller or Affiliates of Seller for
injury to persons or property to the extent caused by Purchaser's
investigations and inspection of the Property. Purchaser shall undertake its
obligation to defend set forth in the preceding sentence using attorneys
selected by Purchaser and reasonably acceptable to Seller.
C. If Purchaser is dissatisfied with the results of the tests,
studies or investigations performed or information received pursuant to this
Paragraph 16, in Purchaser's sole judgment for any reason or for no reason,
Purchaser shall have the right to terminate this Agreement by giving written
notice of such termination to Seller at any time prior to the expiration of the
Inspection Period. If written notice is not given by Purchaser pursuant to
this Paragraph 16 prior to the expiration of the Inspection Period, then the
right of Purchaser to terminate this Agreement pursuant to this Paragraph 16
shall be waived. If Purchaser terminates this Agreement by written notice to
Seller prior to the expiration of the Inspection Period: (i) Purchaser shall
promptly deliver to Seller copies of all studies, reports and other
investigations obtained by Purchaser and prepared by third parties (to the
extent that such delivery shall not constitute a breach of contract) in
connection with its due diligence during the Inspection Period; (ii) the
Earnest Money deposited by Purchaser shall be immediately paid to Purchaser,
together with any interest earned thereon and (iii) this Agreement shall
terminate and neither Purchaser nor Seller shall have any right, obligation or
liability under this Agreement, except for Purchaser's obligation to indemnify
Seller and restore the Property, as more fully set forth in this Paragraph 16.
Notwithstanding anything contained herein to the contrary, Purchaser's
obligation to indemnify Seller and restore the Property, as more fully set
forth in this Paragraph 16, shall survive the Closing, the delivery of the Deed
and the termination of this Agreement.
<PAGE>
17. SELLER'S REPRESENTATIONS AND WARRANTIES AND LIABILITY.
A. Any reference herein to Seller's knowledge or to the best of
Seller's knowledge or to any representation, warranty or notice of any matter
or thing, shall only mean such knowledge or notice that has actually been
received by Phillip Schechter, and any representation or warranty of the Seller
is based upon those matters of which Phillip Schechter has actual knowledge,
provided that the representations and warranties made in (vi) and (vii) of
Paragraph 17B hereof are not so limited to Phillip Schechter's knowldege except
where specifically noted in subsection (vii) of Paragraph 17B. Any knowledge
or notice given, had or received by any of Seller's agents, servants or
employees shall not be imputed to Seller or the individual partners or the
general partner of Seller.
B. Subject to the limitations set forth in Paragraph 17a above,
Seller hereby makes the following representations and warranties, all of which
are made to the best of Seller's knowledge, each of which shall be deemed made
as of the Closing and survive the Closing and delivery of the Deed for ninety
(90) days except for subparagraphs (vi) and (vii) which shall survive for the
statutory period:
(i) The present use and occupancy of the Property conform with
applicable building and zoning laws and Seller has received no notice that
any such laws, rules or regulations are being violated.
(ii) The rent rolls which Seller has submitted to Purchaser and
updated as of the Closing Date are true and accurate.
(iii) Except as set forth on Exhibit Q, Seller has no knowledge
of any pending or threatened litigation, claim, cause of action or
administrative proceeding concerning the Property.
(iv) Except as set forth in Paragraph 12B hereof, there are no
real estate tax protests or proceedings affecting the Property.
(v) Seller has received no written notice of any pending or
threatened condemnation or similar proceeding or pending public
improvements in or adjoining the Land which will in any manner affect the
Property.
(vi) Each person executing and delivering this Agreement and all
documents to be executed and delivered in regard to the consummation of
the transaction which is the subject of this Agreement on behalf of Seller
represents to Purchaser that he has due and proper authority to execute
and deliver same. Seller has the full right, power and authority to sell
and convey the Property to Purchaser as provided herein and to carry out
its obligations hereunder. The consummation by Seller of the transaction
which is the subject of this Agreement will not conflict with or result in
a breach of any of the terms of any agreement or instrument to which
Seller is a party or by which Seller is bound or constitute a default
thereunder. No other party has any right to purchase the Property, or any
part thereof.
<PAGE>
(vii) Neither Seller nor any of Seller's general partners is the
subject of any existing or pending or to the actual knowledge of Phillip
Schechter threatened or contemplated bankruptcy, solvency or other debtor's
relief proceeding.
(viii) Seller does not have any employees at the Property.
C. As a condition precedent to Purchaser's obligations at Closing
and regardless of the provisions of Paragraph 17A hereof , all representations
and warranties provided in this Agreement to be made by Seller as of the
Closing shall be true as of the Closing, whether or not Phillip Schecther has
actual knowledge that any representation or warranty is not true.
18. LIMITATION OF SELLER'S LIABILITY. No general or limited partner of
Seller, nor any of its respective beneficiaries, shareholders, partners,
officers, agents, employees, heirs, successors or assigns shall have any
personal liability of any kind or nature for or by reason of any matter or
thing whatsoever under, in connection with, arising out of or in any way
related to this Agreement and the transaction contemplated herein, and
Purchaser hereby waives for itself and anyone who may claim by, through or
under Purchaser any and all rights to sue or recover on account of any such
alleged personal liability. This provision shall not preclude Purchaser from
instituting and maintaining any legal action against Seller; provided, however,
notwithstanding the foregoing to the contrary, the maximum liability of Seller
hereunder is $250,000. Seller shall not distribute $250,000 of the net
proceeds of the Purchase Price to its partners until ninety (90) days after the
Closing Date.
19. TIME OF ESSENCE. Time is of the essence of this Agreement.
20. NOTICES. Any notice or demand which either party hereto is required
or may desire to give or deliver to or make upon the other party shall be in
writing signed by the party giving the same or by its attorneys and may be
personally delivered or given or made by overnight courier such as Federal
Express or by facsimile or made by United States registered or certified mail
addressed as follows:
TO SELLER: c/o The Balcor Company
Bannockburn Lake Office Plaza
2355 Waukegan Road
Suite A200
Bannockburn, Illinois 60015
Attn: Ilona Adams
847/267-1600
847/317-4462 (FAX)
with copies to: The Balcor Company
Bannockburn Lake Office Plaza
2355 Waukegan Road
Suite A200
Bannockburn, Illinois 60015
Attn: Al Lieberman
847/317-4360
847/317-4462 (FAX)
<PAGE>
and
Andrew D. Small Esq.
Katten Muchin & Zavis
Suite 1600
525 West Monroe Street
Chicago, Illinois 60661
312/902-5489
312/902-1061 (FAX)
TO PURCHASER: Mr. Thomas Gochberg
c/o TGM Associates L.P.
650 Fifth Avenue
28th Floor
New York, New York 10019
212/830-9300
212/399-6310 (FAX)
with a copy to: Alan E. Linder, Esq.
Bachner, Tally, Polevoy & Misher LLP
380 Madison Avenue
New York, New York 10017-2590
212/503-2090
212/682-5729 (FAX)
subject to the right of either party to designate a different address for
itself by notice similarly given. Any notice or demand so given shall be deemed
to be delivered or made on the next Business Day if sent by overnight courier,
or on the same day if sent by facsimile or on the 4th Business Day after the
same is deposited in the United States Mail as registered or certified mail,
addressed as above provided, with postage thereon fully prepaid. Any such
notice, demand or document not given, delivered or made by registered or
certified mail or by overnight courier or by facsimile as aforesaid shall be
deemed to be given, delivered or made upon receipt of the same by the party to
whom the same is to be given, delivered or made. Copies of all notices shall
be served upon the Escrow Agent.
21. EXECUTION OF AGREEMENT AND ESCROW AGREEMENT. Purchaser will execute
three (3) counterparts of this Agreement and three (3) counterparts of the
Escrow Agreement and forward them to Seller for Seller's execution. Seller
will forward one (1) fully executed counterpart of the executed Agreement to
Purchaser's attorneys and will forward the following to the Escrow Agent:
A. One (1) fully executed copy of this Agreement; and
B. Three (3) copies of the Escrow Agreement signed by the parties
with a direction to execute two (2) counterparts of the Escrow Agreement and
deliver a fully executed counterpart to Purchaser's attorneys and Seller.
Purchaser shall deliver the Earnest Money to Escrow Agent on the same day
that Purchaser executes the Escrow Agreement. If Purchaser's attorney has not
received one fully executed counterpart of this Agreement and the Escrow
<PAGE>
Agreement within four (4) Business Days after Purchaser delivers the Earnest
Money to Escrow Agent, then at Purchaser's election, the Earnest Money and the
executed counterparts of this Agreement shall be returned to Purchaser.
22. GOVERNING LAW. The provisions of this Agreement shall be governed by
the laws of the State of Georgia.
23. ENTIRE AGREEMENT. This Agreement and the attached Exhibits
constitute the entire agreement between the parties with respect to the subject
matter hereof and supersedes all other negotiations, understandings and
representations made by and between the parties and the agents, servants and
employees.
24. COUNTERPARTS. This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original but all of which shall
constitute one and the same instrument.
25. CAPTIONS. Paragraph or Exhibit titles or captions contained herein
are inserted as a matter of convenience and for reference, and in no way
define, limit, extend or describe the scope of this Agreement or any provision
hereof.
26. MODIFICATIONS. This Agreement cannot be changed, modified,
discharged or terminated by any oral agreement or any other agreement and there
cannot be any waiver of the warranties, representations and covenants expressly
contained in this Agreement unless the same is in writing and signed by the
party against whom enforcement of the change, modification, discharge,
termination or waiver is sought.
27. SUCCESSORS AND ASSIGNS. This Agreement shall be binding on, and the
benefits hereof shall inure to, the successors and assigns of the parties
hereto.
28. INVALIDITY. If any term or provision of this Agreement, or any part
of such term or provision, or the application thereof to any person or
circumstance shall to any extent be held invalid or unenforceable, the
remainder of this Agreement or the application of such term or provision or
remainder thereof to persons or circumstances other than those as to which it
is held invalid and unenforceable shall not be affected thereby and each term
and provision of this Agreement shall be valid and enforceable to the fullest
extent permitted by law.
29. EXHIBITS. All Exhibits which are annexed to this Agreement are part
of this Agreement and are incorporated herein by reference.
30. NO THIRD PARTY BENEFICIARY. The provisions of this Agreement are for
the sole benefit of the parties to this Agreement and their successors and
assigns and shall not give rise to any rights by or on behalf of anyone other
than such parties.
<PAGE>
31. ATTORNEYS' FEES. In the event that any litigation arises under this
Agreement, the prevailing party shall be entitled to recover, as a part of its
judgment, reasonable attorneys' fees.
32. CORRECTION DEED. Seller will, whenever reasonably requested so to do
by Purchaser, execute, acknowledge and deliver, or cause to be executed,
acknowledged and delivered, a correction deed as may be reasonably necessary in
order to complete the transaction which is the subject of this Agreement and to
carry out the intent and purposes of this Agreement. Such correction deed
shall be satisfactory to the attorneys for Purchaser. The provisions of this
Paragraph shall survive the Closing.
33. BUSINESS DAYS. If the date for performance of any act pursuant to
the Agreement is not a Business Day, then such act shall be performed on the
next succeeding Business Day. The term "Business Days" shall mean all days,
except Saturdays, Sundays and all days observed by the Federal Government as
legal holidays.
34. OPERATIONS PRIOR TO CLOSING. Seller agrees that between the date
hereof and the Closing Date, Seller will:
A. continue to operate the Property as heretofore operated;
B. afford Purchaser and its representatives full access to the
Property and to Seller's books, records and files relating to and maintained at
the Property, at reasonable times, upon forty- eight (48) hours prior notice
and during normal business hours, including but not limited to the date of the
Closing;
C. not enter into any new Lease, nor amend, modify or terminate
any existing Lease without having obtained the prior written consent of
Purchaser in each such instance; notwithstanding the foregoing, Seller may
enter into Leases of not more than one year upon market rents and upon
commercially reasonable terms;
D. not apply any Tenant's security deposits to the discharge of
such Tenant's obligations unless such Tenant has vacated or been evicted from
such Tenant's demised premises;
E. advise Purchaser promptly of any litigation or governmental
proceeding to which Seller becomes a party affecting the Property (it shall be
a condition precedent to Purchaser's obligation to accept title, that there
shall be no such litigation or proceeding pending at Closing having a potential
adverse effect upon the Property or Seller's ability to convey the Property to
Purchaser);
F. not permit any alteration, structural modification or additions
to the Property;
G. not create (or agree to create) any exception to or covenant,
restriction, easement or other lien on the Property; and
H. not enter into any new Contract, nor amend, modify or terminate
any existing Contract.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date set forth above.
Executed by Purchaser on PURCHASER:
July , 1996.
TGM REALTY CORP. #5, a Delaware corporation
By: /s/ Thomas Gochberg
----------------------------------
Name: Thomas Gochberg
----------------------------------
Title: President
----------------------------------
Executed by Seller on SELLER:
July 22, 1996.
BALCOR REALTY INVESTORS, LTD.-82,
an Illinois limited partnership
By: Balcor Partners-XI, an Illinois general
partnership, its general partner
By: RGF-Balcor Associates-II, an Illinois
general partnership, a general partner
By: The Balcor Company, a Delaware
corporation, a general partner
By: /s/ Alan G. Lieberman
-----------------------------
Name: Alan G. Lieberman
-----------------------------
Title: Senior Vice President
-----------------------------
<PAGE>
of Apartment Realty Advisors, ("Broker")
executes this Agreement in its capacity as a real estate broker and
acknowledges that the fee or commission ("Fee") due it as a result of the
transaction described in this Agreement is the amount as set forth in the
listing agreement between Broker and Seller. Such Fee and any other amounts
due Broker shall be paid solely by Seller, and Purchaser shall have no
liability whatsoever to Broker under any circumstances, whether or not the
Closing occurs. Broker also acknowledges that payment of the aforesaid Fee is
conditioned upon the Closing and the receipt of the Purchase Price by Seller.
Broker agrees to deliver a receipt to Seller at the Closing for the Fee and a
release stating that no other fees or commissions are due to Listing Broker
from Seller or Purchaser. A copy of broker's receipt and release will be
delivered to Purchaser at the Closing.
APARTMENT REALTY ADVISORS
By:
-----------------------------------
Tax I.D. Number
-------------------------
<PAGE>
EXHIBITS
A - Legal
B - Personal Property
C - Escrow Agreement
D - Deed
E - Endorsements
F - Bill of Sale
G - Assignment of Service Contracts
H - Assignment of Leases and Security Deposits
I - Notice to Tenants
J - Post-Closing Adjustment Letter
K - Non-Foreign Affidavit
L - Assignment of Intangibles
M - Assignment of Licenses and/or Permits
N - Assignment of Warranties and Guarantees
O - Information for Real Estate 1099-S Report Filing
P - Acknowledgment of Title Insurer with regard to
Real Estate 1099-S Report Filing
Q - Litigation
<PAGE>
AGREEMENT OF SALE
THIS AGREEMENT, entered into as of the 19th day of July, 1996, by and
between ERP OPERATING LIMITED PARTNERSHIP, an Illinois limited partnership
("Purchaser") and SONG I LIMITED PARTNERSHIP, an Illinois limited partnership
("Seller").
WITNESSETH:
1. PURCHASE AND SALE. Purchaser agrees to purchase and Seller agrees to
sell at the price of Eleven Million and No/100 Dollars ($11,000,000.00), that
certain property ("Property") in San Antonio, Texas more particularly described
on Exhibit A attached hereto, which Property is known as Songbird Apartments
and contains 262 units and approximately 15 acres. Included in the "Purchase
Price" (as hereinafter defined) is all of Seller's right, title and interest in
the personal property set forth on Exhibit B, which shall be transferred to
Purchaser at "Closing" (as hereinafter defined) by a Bill of Sale; and all
right, title and interest of Seller (whether now or hereafter existing) in and
to any land lying in the bed of any street, alley, road or avenue (whether
open, closed or proposed) within, in front of, behind or otherwise adjoining
the Property or any of it; and all right, title and interest of Seller (whether
now or hereafter existing) in and to any award made or to be made as a result
of or in lieu of condemnation, and in and to any award for damage to the
Property or any part thereof by reason of casualty (all of the foregoing being
included within the term "Property"); and all of the building, structures,
fixtures, facilities, installations and all of Seller's right, title and
interest in other improvements of every kind and description now or hereafter
in, on, over and under the land, including, without limitation, any and all
recreational buildings, structures and facilities, plumbing, airconditioning,
heating, ventilating, mechanical, electrical and other utility systems, parking
lots, landscaping, sidewalks, swimming pools, signs and light fixtures which
are not owned by tenants under leases (all of the foregoing being included
within the term "Property"); and all of Seller's right, title and interest in
all of the following which are in Seller's possession: existing surveys, blue
prints, drawings, plans and specifications (including, without limitation,
structural, HVAC, mechanical and plumbing, water and sewer plans and
specifications); all available tenant lists and data, correspondence with
present and prospective tenants, vendors, suppliers, utility companies and
other third parties, booklets, manuals and promotional and advertising
materials concerning the Property or any part thereof (all of the foregoing
being included within the term "Property"); and all right, title and interest
of Seller in and to the intangible personal property now or hereafter owned by
Seller and used in connection with or arising from the business now or
hereafter conducted on or from the Property or any part thereof, including,
without limitation, claims, choses in action, lease and other contract rights,
names and telephone exchange numbers (all of the foregoing being included
within the term "Property"). The computer software located at the Property is
not included in the conveyance to Purchaser.
<PAGE>
2. PURCHASE PRICE. The purchase price (the "Purchase Price") shall be
paid as follows:
A. Upon the execution of this Agreement, the sum of $300,000.00
("Initial Earnest Money") to be held in escrow by the Escrow Agent (as that
term is defined in the "Escrow Agreement" [as hereinafter defined]) by and in
accordance with the provisions of the Escrow Agreement ("Escrow Agreement")
attached hereto as Exhibit C;
B. On August 15, 1996 the additional sum of $200,000 to be held in
escrow by the Escrow Agent by and in accordance with the provisions of the
Escrow Agreement (in such event, said $200,000 when deposited together with the
Initial Earnest Money shall be referred to herein together as the "Earnest
Money");
C. The assumption by Purchaser of the obligations of Seller, as
borrower, under the "Loan Documents" (as hereinafter defined);
D. On the "Closing Date" (as hereinafter defined), the balance of
the Purchase Price (i.e $11,000,000 less the outstanding principal amount of
the "Loan" [as hereinafter defined]) adjusted in accordance with the prorations
by federally wired "immediately available" funds delivered to the "Title
Insurer" (as hereinafter defined) no later than 12:00 Noon on the Closing Date.
If the funds are not received by 12:00 Noon, then, on the Closing Date,
Purchaser shall pay Seller an amount equal to any additional mortgage per diem
interest costs incurred by the Seller.
3. TITLE COMMITMENT AND SURVEY.
A. Attached hereto as Exhibit D is a copy of a title commitment for
an owner's standard title insurance policy issued by Lawyers Title Insurance
Corporation (hereinafter referred to as "Title Insurer") dated June 24, 1996
for the Property (the "Title Commitment"). For purposes of this Agreement,
"Permitted Exceptions" shall mean: (a) general real estate taxes, association
assessments, special assessments, special district taxes and related charges
not yet due and payable; (b) matters shown on the "Survey" (hereinafter
defined); (c) matters caused by the actions of Purchaser; (d) the title
exceptions set forth in Section II of Schedule B of the Title Commitment as
Numbers 2 through 8 inclusive and 10 through 18 inclusive, to the extent that
same affect the Property; and (e) the "Loan Documents" (as hereinafter
defined). All other exceptions to title shall be referred to as "Unpermitted
Exceptions". The Title Commitment shall be conclusive evidence of good title
as therein shown as to all matters to be insured by the title policy, subject
only to the exceptions therein stated. On the Closing Date, Title Insurer
shall deliver to Purchaser a standard title policy in conformance with the
previously delivered Title Commitment, subject to Permitted Exceptions and
"Unpermitted Exceptions" (as hereinafter defined) which have been waived by
Purchaser (the "Title Policy"). Seller and Purchaser shall divide evenly the
costs of the Title Commitment and Title Policy (including all endorsements,
other than endorsements obtained by Seller to insure over a title defect noted
by Purchaser which shall be paid for by Seller).
<PAGE>
B. Purchaser acknowledges receipt of a survey ("Existing Survey")
of the Property prepared by Galbraith Engineering Consultants, Inc. dated
9/23/93 under Job #16022. Seller has ordered an update of the Existing Survey
(the "Updated Survey"). Purchaser shall have ten (10) days from the date of
receipt of the Updated Survey to approve the Updated Survey. If Purchaser
disapproves the Updated Survey because it contains matters which are not
acceptable to Purchaser ("Survey Defects"), then upon notice delivered to
Seller by Purchaser within ten (10) days from the date of receipt of the
Updated Survey, Seller shall have five (5) days to either: (i) cause the Survey
Defects to be removed from the Updated Survey or (ii) cause the title Insurer
to insure against loss or damage resulting from the Survey Defects ("Title
Indemnity"). If Seller is unwilling to do either (i) or (ii) above, then
Purchaser shall have the right to elect to terminate this Agreement. Purchaser
shall notify Seller of its election within five (5) days after receipt of
notice from Seller that the Survey Defects will not be removed or that the
Title Insurer will not issue the Title Indemnity. If Purchaser fails to make
the election within the aforesaid five (5) days, then it shall be conclusively
presumed that Purchaser has elected to take title to the Property subject to
the Survey Defects. If Purchaser elects to terminate this Agreement pursuant
to this Paragraph, then the Earnest Money plus all accrued interest shall be
delivered to Purchaser immediately following Seller's receipt of the Reports.
If Purchaser desires any modifications to the Updated Survey, Seller will
reasonably cooperate with Purchaser to cause the surveyor to make such
modifications.
4. CONDITION OF TITLE/CONVEYANCE. Seller agrees to convey fee simple
title to the Property by Special Warranty Deed in the form of Exhibit E
attached hereto (the "Deed") in recordable form subject only to the Permitted
Exceptions. If Seller is unable to convey title to the Property subject only
to the Permitted Exceptions because of the existence of an additional title
exception ("Unpermitted Exception"), then Purchaser can elect to take title to
the Property subject to the Unpermitted Exception or terminate this Agreement.
Notwithstanding the aforesaid, Seller shall be required to remove all
Unpermitted Exceptions which are liens of a definite or ascertainable amount.
If Purchaser elects to terminate this Agreement, then the Earnest Money plus
all accrued interest shall be delivered to the Purchaser.
5. PAYMENT OF CLOSING COSTS. Purchaser and Seller hereby agree to
divide evenly the costs of the documentary stamps (if any) to be paid with
reference to the Deed and all other stamps, intangible, documentary, recording,
sales tax and surtax imposed by law with reference to any other documents
delivered in connection with this Agreement as well as for all costs of the
Title Commitment, Title Policy (including all endorsements, other than
endorsements obtained by Seller to insure over a title defect noted by
Purchaser which shall be paid for by Seller), Updated Survey (subject to the
last sentence of this paragraph), escrow charges and all other charges of the
Title Insurer in connection with this transaction. Purchaser and Seller shall
be responsible for the costs of their respective attorneys. Purchaser agrees
to pay for any fees and charges required by the lender in connection with the
assumption of the Loan by the Purchaser. Notwithstanding the foregoing to the
contrary, if Purchaser elects to terminate this Agreement and as a consequence
of such termination Purchaser is entitled to receive the Earnest Money,
including interest thereon, following Seller's receipt of the "Reports," then
so long as Purchaser delivers the Reports to Seller, Seller shall be
responsible to pay for the Updated Survey.
<PAGE>
6. DAMAGE, CASUALTY AND CONDEMNATION.
A. If the Property suffers damage as a result of any casualty prior
to the Closing Date and can be repaired or restored in the case of real
property for $110,000 or less, or in the case of Personal Property, for
$25,000.00 or less, as determined by Seller in good faith, then Seller shall
either repair such damage prior to Closing or, at Purchaser's option (which
shall be exercised by Purchaser within ten (10) days after notice of such
casualty), allow Purchaser a credit against the Purchase Price in an amount
equal to the reasonably estimated cost of repair. Seller shall retain all
insurance proceeds. If the cost of repair or restoration exceeds the aforesaid
amounts (as determined by Seller in good faith), then Purchaser can, upon
notice to Seller within ten (10) days after notice of such casualty, elect to
either: (a) cause Seller to repair and restore same, in which event the Closing
Date will be extended until such date as may reasonably be required to complete
the repair or restoration; or (b) terminate this Agreement upon notice to
Seller served within ten (10) days of notice of such casualty or (c) accept the
Property in its damaged condition together with an assignment from Seller of
all insurance proceeds and receive a credit at Closing in the amount of the
deductible.
B. If condemnation proceedings ("Proceedings") have been instituted
against the Property and such Proceedings are in an amount less than $100,000,
then Purchaser shall take the Property subject to the Proceedings and an
assignment of Seller's interest in the Proceedings. If the Proceedings are in
excess of $100,000.00, then Purchaser can elect to either take the Property
subject to the Proceedings and an assignment of Seller's interest in the
Proceedings or terminate this Agreement. If Purchaser elects to terminate this
Agreement, it shall be by notice to the Seller within five (5) days after
Seller notifies Purchaser of the Proceedings.
C. If the Agreement is terminated pursuant to this Paragraph, then
the Earnest Money plus all accrued interest shall be delivered to the
Purchaser.
7. AS-IS CONDITION.
A. Except as may hereinafter be specifically set forth in this
Agreement, Purchaser is not relying on Seller having made any inquiry as to the
condition of the Property or the leases. Purchaser acknowledges and agrees
that, except as may hereinafter be specifically set forth in this Agreement, it
will be purchasing the Property based solely upon its inspection and
investigations of the Property and that Purchaser will be purchasing the
Property "AS IS" and "WITH ALL FAULTS" based upon the condition of the Property
as of the date of this Agreement, subject to reasonable wear and tear and loss
by fire or other casualty or condemnation from the date of this Agreement until
the Closing Date. Without limiting the foregoing, Purchaser acknowledges that,
except as may otherwise be specifically set forth elsewhere in this Agreement,
neither Seller nor its consultants, brokers or agents have made any other
representations or warranties of any kind upon which Purchaser is relying as to
any matters concerning the Property, including, but not limited to, the
condition of the land or any improvements, the existence or nonexistence of
asbestos, lead in water, lead in paint, radon, underground or above ground
<PAGE>
storage tanks, petroleum, toxic waste or any "Hazardous Materials" or
"Hazardous Substances" (as such terms are defined below), the tenants of the
Property or the leases affecting the Property, economic projections or market
studies concerning the Property, any development rights, taxes, bonds,
covenants, conditions and restrictions affecting the Property, water or water
rights, topography, drainage, soil, subsoil of the Property, the utilities
serving the Property or any zoning, environmental or building laws, rules or
regulations affecting the Property. Seller makes no representation that the
Property complies with Title III of the Americans With Disabilities Act and,
except as may hereinafter be specifically set forth in this Agreement, Seller
makes no representation that the Property complies with any fire codes or
building codes. Purchaser hereby releases Seller from any and all liability in
connection with any claims which Purchaser may have against Seller, and
Purchaser hereby agrees not to assert any claims, for damage, loss,
compensation, contribution, cost recovery or otherwise, against Seller, whether
in tort, contract, or otherwise, relating directly or indirectly to the
existence of asbestos or Hazardous Materials or Hazardous Substances on, or
environmental conditions of, the Property, or arising under the "Environmental
Laws" (as such term is hereinafter defined), or relating in any way to the
quality of the indoor or outdoor environment at the Property. This release
shall survive the Closing. As used herein, the term "Hazardous Materials" or
"Hazardous Substances" means (i) hazardous wastes, hazardous materials,
hazardous substances, hazardous constituents, toxic substances or related
materials, whether solids, liquids or gases, including but not limited to
substances defined as "hazardous wastes," "hazardous materials," "hazardous
substances," "toxic substances," "pollutants," "contaminants," "radioactive
materials," or other similar designations in, or otherwise subject to
regulation under, the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended ("CERCLA"), 42 U.S.C. Section 9601 et seq.;
the Toxic Substance Control Act ("TSCA"), 15 U.S.C. Section 2601 et seq.; the
Hazardous Materials Transportation Act, 49 U.S.C. Section 1802; the Resource
Conservation and Recovery Act ("RCRA"), 42 U.S.C. Section 9601, et seq.; the
Clean Water Act ("CWA"), 33 U.S.C. Section 1251 et seq.; the Safe Drinking
Water Act, 42 U.S.C. Section 300f et seq.; the Clean Air Act ("CAA"), 42 U.S.C.
Section 7401 et seq.; and in any permits, licenses, approvals, plans, rules,
regulations or ordinances adopted, or other criteria and guidelines promulgated
pursuant to the preceding laws or other similar federal, state or local laws,
regulations, rules or ordinance now or hereafter in effect relating to
environmental matters (collectively the "Environmental Laws"); and (ii) any
other substances, constituents or wastes subject to any applicable federal,
state or local law, regulation or ordinance, including any Environmental Law,
now or hereafter in effect, including but not limited to (A) petroleum, (B)
refined petroleum products, (C) waste oil, (D) waste aviation or motor vehicle
fuel, (E) asbestos, (F) lead in water, paint or elsewhere, (G) radon, (H)
Polychlorinated Biphenyls (PCB's) and (I) ureaformaldehyde.
B. Seller has provided to Purchaser certain unaudited historical
financial information regarding the Property relating to certain periods of
time in which Seller owned the Property. Seller and Purchaser hereby
acknowledge that such information has been provided to Purchaser at Purchaser's
request solely as illustrative material. Except as may hereinafter be
specifically set forth in this Agreement, Seller makes no representation or
<PAGE>
warranty that such material is complete or accurate or that Purchaser will
achieve similar financial or other results with respect to the operations of
the Property, it being acknowledged by Purchaser that Seller's operation of the
Property and allocations of revenues or expenses may be vastly different than
Purchaser may be able to attain. Purchaser acknowledges that it is a
sophisticated and experienced purchaser of real estate and further that
Purchaser has relied upon its own investigation and inquiry with respect to the
operation of the Property and releases Seller from any liability with respect
to such historical information.
8. ASSUMPTION OF LOAN. The Property is currently encumbered by that
certain Mortgage (the "Mortgage") by Seller for the benefit of Berkshire
Mortgage Finance Limited Partnership (the "Lender"), dated as of October 7,
1993, which secured that certain Promissory Note (the "Note") made by Seller in
favor of Lender in the original principal amount of $7,325,000 (the Mortgage
and the Note, together with all other documents or instruments entered into in
connection with the Mortgage and the Note, are hereinafter referred to as the
"Loan Documents").
Notwithstanding anything contained in this Agreement to the contrary,
Purchaser and Seller agree that the obligation of each party to consummate the
transactions contemplated by this Agreement are contingent upon the occurrence
of the following (the "Condition Precedent") on or before August 30, 1996 (the
"Deadline Date"): Lender consenting, in writing, to (i) the assumption by
Purchaser of Seller's obligations under the Loan Documents and (ii) a release
by Lender of Seller from any liability under the Loan Documents (together, the
"Lender Consent"); provided, however, if the Lender will not provide such a
release, then Purchaser shall provide, and Seller will accept in lieu of such a
release, an indemnification by Purchaser of Seller for all liability under the
Loan and the Loan Documents arising after the Closing Date. Seller and
Purchaser shall jointly pursue obtaining the Lender Consent, with the Seller
having primary responsibility therefor. Seller shall keep Purchaser advised of
and allow Purchaser to participate in the process of obtaining the Lender
Consent and Purchaser agrees to cooperate with Seller in Seller's efforts to
obtain the Lender Consent. In connection therewith, Purchaser shall provide
Lender (or Seller for delivery to Lender) any and all documentation reasonably
requested by Seller or Lender in connection with obtaining the Lender Consent.
If Seller and Purchaser are unable to obtain the Lender Consent on or
before the Deadline Date, then this Agreement shall be automatically
terminated. If this Agreement is terminated in accordance with the immediately
preceding sentence, then the Earnest Money deposited by Purchaser, together
with any interest earned thereon, shall be paid to Purchaser promptly following
delivery of the Reports to Seller and neither Purchaser nor Seller shall have
any right, obligation or liability under this Agreement, except for Purchaser's
obligation to indemnify Seller and restore the Property, as more fully set
forth in Paragraph 7 hereof.
Provided the Lender Consent is obtained, then at the Closing (i) Purchaser
shall assume all of Seller's obligations under the Loan Documents and (ii)
Seller shall be released from any liability under the Loan Documents (or
Purchaser shall provide to Seller the indemnification identified above).
<PAGE>
In connection therewith, Purchaser and Seller agree to execute customary and
necessary documents (the "Assumption Documents") reflecting such assumption and
such release reasonably required by the Lender and reasonably acceptable to
Purchaser and Seller.
9. CLOSING. The closing ("Closing") of this transaction shall be on
August 30, 1996 ("Closing Date"), at the office of the Seller's attorney, at
which time Seller shall deliver possession of the Property to Purchaser.
10. CLOSING DOCUMENTS.
A. On the Closing Date, Purchaser shall deliver to Seller an
executed closing statement, the balance of the Purchase Price, and such other
documents as may be reasonably required in order to consummate the transaction
as set forth in this Agreement, including, without limitation, the Assumption
Documents.
B. On the Closing Date, Seller shall deliver to Purchaser
possession of the Property; counterparts of the Assumption Documents, the Deed
subject to the Permitted Exceptions and those Unpermitted Exceptions waived by
Purchaser; a UCC search from appropriate jurisdictions reflecting no liens
against Seller, or a termination statement as to any lien secured by a UCC
filing; an inventory of the Personal Property and a Bill of Sale for the same
(in the form of Exhibit F attached hereto); an executed closing statement; an
executed assignment and assumption of all service contracts (in the form of
Exhibit G attached hereto); an executed assignment and assumption of all leases
and security deposits (in the form of Exhibit H attached hereto); updated rent
roll; a notice to the tenants of the transfer of title and the assumption by
Purchaser of the landlord's obligations under the leases and the obligation to
refund the security deposits (in the form of Exhibit I attached hereto), the
original leases to be delivered to Purchaser at the Property; a non-foreign
affidavit (in the form of Exhibit J attached hereto) and such other documents
as may be reasonably required by the Title Insurer in order to consummate the
transaction as set forth in this Agreement and shall cause the Title Company to
deliver the Title Policy subject only to Permitted Exceptions and Unpermitted
Exceptions waived by Purchaser.
11. DEFAULT BY PURCHASER. ALL EARNEST MONEY DEPOSITED INTO THE ESCROW IS
TO SECURE THE TIMELY PERFORMANCE BY PURCHASER OF ITS OBLIGATIONS AND
UNDERTAKINGS UNDER THIS AGREEMENT. IN THE EVENT THIS TRANSACTION FAILS TO
CLOSE DUE TO THE DEFAULT OF THE PURCHASER UNDER THE PROVISIONS OF THIS
AGREEMENT, SELLER SHALL RETAIN ALL OF THE EARNEST MONEY AND THE INTEREST
THEREON AS SELLER'S SOLE RIGHT TO DAMAGES OR ANY OTHER REMEDY. THE PARTIES
HAVE AGREED THAT SELLER'S ACTUAL DAMAGES, IN THE EVENT OF A DEFAULT BY
PURCHASER, WOULD BE EXTREMELY DIFFICULT OR IMPRACTICAL TO DETERMINE.
THEREFORE, BY PLACING THEIR INITIALS BELOW, THE PARTIES ACKNOWLEDGE THAT THE
EARNEST MONEY HAS BEEN AGREED UPON, AFTER NEGOTIATION, AS THE PARTIES'
REASONABLE ESTIMATE OF SELLER'S DAMAGES.
12. SELLER'S DEFAULT. IF THIS SALE IS NOT COMPLETED BECAUSE OF SELLER'S
DEFAULT, PURCHASER'S SOLE REMEDY SHALL BE ACTUAL DAMAGES NOT TO EXCEED THE
AMOUNT OF THE EARNEST MONEY THEN ON DEPOSIT WITH THE ESCROW AGENT, PLUS THE
RETURN OF ALL EARNEST MONEY TOGETHER WITH ANY INTEREST ACCRUED THEREON, AND
<PAGE>
THIS AGREEMENT SHALL TERMINATE AND THE PARTIES SHALL HAVE NO FURTHER LIABILITY
TO EACH OTHER AT LAW OR IN EQUITY. NOTWITHSTANDING ANYTHING CONTAINED HEREIN
TO THE CONTRARY, IF SELLER'S DEFAULT IS ITS REFUSAL TO DELIVER THE DEED, THEN
PURCHASER WILL BE ENTITLED TO SUE FOR SPECIFIC PERFORMANCE.
13.
A. PRORATIONS. Rents for the month of the Closing (exclusive of
delinquent rents, but including prepaid rents); any previously paid signing
bonus or similar payment relating to any laundry room, cable, telephone or
similar agreement in effect as of the Closing, refundable security deposits
with interest if required by local law (which will be assigned to and assumed
by Purchaser and credited to Purchaser at Closing); refundable and
non-refundable pet and cleaning fees and deposits, water and other utility
charges; fuels; prepaid operating expenses; real and personal property taxes
(as provided for in the next following sentence); and other similar items shall
be adjusted ratably as of 12:01 A.M. on the Closing Date ("Proration Date"),
and credited or debited to the balance of the cash due at Closing. Real
property taxes shall be prorated based on the following information in the
following circumstances: (i) if the current tax bill is available, real
property taxes shall be prorated based on that tax bill; (ii) if the tax bill
for the current tax year is not available, real property taxes shall be
prorated based on an assessed valuation for the Property of $7,987,500
multiplied by a tax rate equal to 101% of the tax rate for the prior tax year
multiplied by the equalization factor for the prior tax year, if applicable.
In addition, interest accruing under the Loan Documents shall be prorated and
Seller shall receive as a credit from Purchaser the amount of any escrow and
reserve accounts relating to the Loan (including, without limitation, debt
service escrow accounts, tax escrow accounts, replacement reserves, repair
reserves and insurance escrow accounts). Purchaser shall receive as a credit
at Closing any amounts, if any, then owing by the Seller to the Lender which
are unrelated to the assumption of the Loan by the Purchaser or the release of
Seller under the Loan. If the amount of any of the items to be prorated is not
then ascertainable, the adjustment thereof shall be on the basis of the most
recent ascertainable data. All prorations will be final except as to
Delinquent Rents referred to in 13B below, and errors in calculation on the
closing statement. If special assessments have been levied against the
Property for completed improvements, then the amount of any installments which
are due prior to the Closing Date shall be paid by the Seller; and the amount
of installments which are due after the Closing Date shall be paid by the
Purchaser. All assessments for incomplete improvements shall be paid by
Purchaser.
B. DELINQUENT RENTS. If, as of the Closing Date, any rent is in
arrears ("Delinquent Rent") for thirty (30) days or less, then the first rent
collected by Purchaser will be delivered to Seller for the Delinquent Rent. If
Delinquent Rent is in arrears for more than thirty (30) days, then rents
collected by Purchaser shall first be applied to current rent and then to
Delinquent Rent. Purchaser shall deliver Seller's pro rata share within 10
days of Purchaser's receipt of that Delinquent Rent. Within 120 days after the
Closing Date, Purchaser shall deliver to Seller a reconciliation statement of
rents collected by Purchaser through the first 90 days after the Closing Date.
<PAGE>
Seller retains the right to conduct an audit, at reasonable times and upon
reasonable notice, of Purchaser's books and records to verify the accuracy of
the reconciliation statement and if such audit discloses that additional funds
are owing , then the party owing such funds shall promptly pay such sums to the
party so owed. This subparagraph of this Agreement shall survive the Closing
and the delivery and recording of the Deed.
14. RECORDING. This Agreement shall not be recorded and the act of
recording by Purchaser shall be an act of default hereunder by Purchaser and
shall be subject to the provisions of Paragraph 11.
15. ASSIGNMENT. The Purchaser shall not have the right to assign its
interest in this Agreement without the prior written consent of the Seller,
except to an entity directly or indirectly controlled by Purchaser. Any
non-permitted assignment or transfer of, or attempt to assign or transfer,
Purchaser's interest in this Agreement shall be an act of default hereunder by
Purchaser and subject to the provisions of Paragraph 11. Seller hereby
consents to an assignment to an entity which is an affiliate of Purchaser,
provided Purchaser notifies Seller of the assignment at least five (5) business
days prior to the Closing Date.
16. BROKER. The parties hereto hereby each represent and warrant to
the other that neither has retained the services of a broker in connection with
this transaction except for PW Real Estate Group ("Broker") retained by Seller
and whose commission will be paid by Seller. Purchaser agrees to indemnify,
defend and hold harmless the Seller and any partner, affiliate, parent of
Seller, and all shareholders, employees, officers and directors of Seller or
Seller's partner, parent or affiliate (each of the above is individually
referred to as a "Seller Indemnitee") from all claims, including attorneys'
fees and costs incurred by a Seller Indemnitee as a result of anyone's claiming
by or through Purchaser any fee, commission or compensation on account of this
Agreement, its negotiation or the sale hereby contemplated (except for Broker).
Seller agrees to indemnify, defend and hold harmless the Purchaser and any
partner, affiliate, parent of Purchaser and all shareholders, employees,
officers and directors of Purchaser or Purchaser's parent or affiliate (each of
the above is individually referred to as a "Purchaser Indemnitee") from all
claims, including attorneys' fees and costs incurred by a Purchaser Indemnitee
as a result of anyone's claiming by or through Seller any fee, commission or
compensation on account of this Agreement, its negotiation or the sale hereby
contemplated.
17. DOCUMENTS, INSPECTION OF PROPERTY AND APPROVAL PERIOD.
A. Seller has delivered to Purchaser copies of the most recent
available tax bills, rent rolls, insurance premiums, service contracts, utility
account numbers, year-end 1995 and year-to-date 1996 operating statements
(collectively the "Documents"). All of the Documents shall be subject to
approval by Purchaser by the close of business (5:00 P.M. Central Daylight
Time) on August 19, 1996 ("Approval Period"). During the Approval Period, upon
reasonable notice to the Seller, the Purchaser shall have the right to inspect
and approve the condition of the Property including the interior of the
apartments, during normal business hours. Purchaser shall maintain public
<PAGE>
liability insurance policies insuring against claims arising as a result of the
inspections of the Property being conducted by Purchaser. Purchaser agrees to
indemnify, defend, protect and hold Seller harmless from any and all loss,
costs, including attorneys' fees, liability or damages which Seller may incur
or suffer as a result of Purchaser's conducting its inspection and
investigation of the Property including the entry of Purchaser, its employees
or agents and its Lender onto the Property, including without limitation,
liability for mechanics' lien claims.
B. Purchaser agrees to defend and hold Seller harmless from any
injuries, damages or claims of any nature whatsoever which Purchaser's
servants, agents or employees may have as a result of Purchaser's inspection of
the Property. Purchaser further agrees to restore any damage to the Property
which may arise as a result of Purchaser's inspection of the Property.
C. If Purchaser disapproves the Documents or the condition of the
Property, in its sole and absolute discretion, it must be by a notice ("Notice
of Disapproval") delivered to Seller and the Escrow Agent prior to the
expiration of the Approval Period. The Notice of Disapproval delivered to
Seller shall be accompanied by copies of all third-party reports ("Reports")
which Purchaser has received during the Approval Period. Upon receipt of the
Notice of Disapproval and copies of the Reports, the Earnest Money plus the
interest accrued thereon shall be returned to the Purchaser. If Purchaser does
not timely deliver a Notice of Disapproval and copies of the Reports to Seller,
then it shall be conclusively presumed that Purchaser has approved the
Documents and the condition of the Property and all Earnest Money plus the
interest accrued thereon shall belong to Seller unless Seller is in default
hereunder.
In addition, on August 20, 1996, Purchaser shall deposit with the Escrow
Agent the additional $200,000 of Earnest Money required to be deposited by
Paragraph 2B of this Agreement. If Purchaser fails to so deposit said $200,000
with the Escrow Agent, Purchaser shall be in default hereunder.
18. SURVIVAL OF INDEMNITY. Notwithstanding anything in this Agreement to
the contrary, the parties' obligations to indemnify, defend and hold each other
harmless under various provisions of this Agreement shall forever survive the
termination of this Agreement or the Closing and delivery and recording of the
Deed.
19. SELLER'S REPRESENTATIONS, WARRANTIES AND COVENANTS.
A. Any reference herein to Seller's knowledge, representation,
warranty or notice of any matter or thing, shall only mean such knowledge or
notice that has actually been received by Alan Lieberman and Phillip Schechter,
and any representation or warranty of the Seller is based upon those matters of
which Alan Lieberman and Phillip Schechter have actual knowledge. A copy of
this Paragraph 19 shall be delivered to the resident manager of the Property
within two (2) days after the execution by Seller of this Agreement, with a
request to advise Phillip Schechter within five (5) business days after receipt
by the resident manager as to the accuracy and truthfulness of the
representations and warranties. Phillip Schechter shall notify Purchaser as to
<PAGE>
the response of the resident manager by July 31, 1996 if the resident manager
indicated that any of the representations or warranties were incorrect. If Mr.
Schechter fails to so notify Purchaser, Purchaser shall be entitled to conclude
that the resident manager reviewed the representations and warranties and that
they are correct. Any knowledge or notice given, had or received by any of
Seller's agents, servants or employees shall not be imputed to Seller or the
individual partners or the general partner of Seller.
B. Subject to the limitations set forth in subparagraph "A" above,
Seller hereby makes the following representations and warranties, all of which
are made to the Seller's knowledge. The parties agree that the representations
contained herein shall survive Closing for a period of 120 days (i.e. the
claiming party shall have no right to make any claims against the other party
for a breach of a representation or warranty after the expiration of 120 days
immediately following Closing.)
(1) Except as set forth on Exhibit K attached hereto, the
present use and occupancy of the Property conform with applicable building
and zoning laws and Seller has received no written notice that any such
laws, rules or regulations are being violated.
(2) The rent roll attached hereto as Exhibit L and which shall
be updated as of the Closing Date is true and accurate. No tenant under
any lease has any option or right of first refusal to acquire any
ownership interest in the Property or any right to terminate its lease or
is entitled to any rebate or concession except as set forth in its lease
or on Exhibit L.
(3) Except as set forth on Exhibit K attached hereto, Seller
has no knowledge of any pending or threatened litigation, claim, cause of
action or administrative proceeding concerning the Property.
(4) Attached hereto as Exhibit M are copies of all licenses and
permits which are in Seller's possession and all service contracts
affecting the Property (none of which is in default), except for the
management agreement which shall be terminated as of the Closing Date; and
Seller shall not enter into any new service contracts which cannot be
terminated within 30 days written notice or modify or extend any existing
service contracts without the prior consent of Purchaser which consent
shall not be unreasonably withheld or delayed.
(5) Seller has not received any written notice from any tenant
occupying the Property that Seller is in default under that tenant's
lease.
(6) Except as set forth on Exhibit K attached hereto, Seller
has not received from any governmental authority, any written notice of
zoning, building, fire, health code or other violations with respect to
the Property, or any part thereof, that will not have been corrected prior
to Closing solely at Seller's expense.
<PAGE>
(7) Seller is duly organized, validly existing, qualified and
empowered to conduct its business, and has full power and authority to
perform and comply with the terms of this Agreement. Neither the
execution and delivery of this Agreement nor its performance will conflict
with or result in the breach of Seller's partnership agreement or any
contract or agreement to which Seller is a party or by which Seller is
bound.
(8) This Agreement is valid and enforceable against Seller in
accordance with its terms and each instrument to be executed by Seller
pursuant to this Agreement or in connection herewith will, when executed
and delivered, be valid and enforceable against Seller in accordance with
its terms.
(9) Seller has not received written notice from any
governmental authority alleging that the Property presently contains
Hazardous Materials or Hazardous Substances.
(10) As of the Closing Date, no leasing commissions will be due
subsequent to the Closing Date.
(11) None of the on-site employees is employed by the Seller.
(12) Through the Closing Date, Seller shall continue to operate,
manage and maintain the Property in the same manner as prior to the
execution of this Agreement.
(13) Seller shall not extend or otherwise renew any lease
without the prior written consent of Purchaser, except for any renewal or
other extension of a lease providing for a monthly rental of not less than
the monthly rental being presently charged for a similar apartment and for
a period of time not to exceed twelve (12) months.
(14) Seller agrees not to distribute the net proceeds of the
Purchase Price up to a maximum amount of $500,000 to its partners for one
hundred twenty (120) days after the Closing Date.
(15) Exhibit B attached hereto is a list of all the personal
property owned by Seller and used in the operation of the Property. The
computer software used at the Property will not be transferred to the
Purchaser.
(16) The unaudited operating statements heretofore or hereafter
delivered to Purchaser by Seller are and shall be true, complete and
correct in all material respects.
(17) Seller has previously delivered to Purchaser a true,
correct and complete copy of the material Loan Documents. Furthermore,
except as disclosed by Seller to Purchaser, Seller has not received notice
from the Lender that the Loan is in default. Seller has not entered into
any written modifications of the Loan since January 1, 1996 which have not
been delivered to Purchaser.
<PAGE>
C. For the period commencing with the execution of this Agreement,
and expiring at the earlier of a termination of this Agreement or the Closing
Date, Seller will not offer the Property for sale to any other third party.
D. Seller shall furnish to Purchaser unaudited operating
statements, rent rolls and a leasing status report on a monthly basis.
E. Upon at least two (2) days' prior notice, Purchaser shall have
the right, during normal business hours, to visit the Property and the
interiors of the apartments.
F. Seller shall not apply security deposits towards delinquent rent
except for (i) those tenants who have vacated their apartments or (ii) tenants
who are in arrears for rent for more than thirty (30) days and Seller has
commenced the process of evicting the tenant.
G. Seller hereby agrees to remake the aforesaid representations and
warranties at Closing. If at any time after the execution of this Agreement,
Seller becomes aware of information which makes a representation or warranty
contained in this Agreement to become untrue in any material respect, Seller
shall promptly disclose said information to Purchaser. Provided the
representation or warranty was true when made and further provided that Seller
did not take any deliberate actions to cause the representation or warranty in
question to become untrue in any material respect, Seller shall not be in
default under this Agreement and the sole remedy of Purchaser shall be to
terminate this Agreement. Notwithstanding anything contained herein to the
contrary, if the status of any of the tenancies changes from the date of the
rent roll attached hereto and the date of the rent roll delivered at Closing,
provided the change in status is not caused by a breach of Seller's covenants
contained herein, then Purchaser shall not have the right to terminate this
Agreement or make any claim for a breach of a representation or warranty
hereunder involving the rent roll or tenancies thereunder. Purchaser and
Seller are prohibited from making any claims against the other party hereto
after the Closing with respect to any breaches of the other party's
representations and warranties contained in this Agreement that the claiming
party had actual knowledge of prior to Closing.
20. PURCHASER'S REPRESENTATIONS AND WARRANTIES. Purchaser hereby
represents and warrants to Seller that Purchaser has the full right, power and
authority to execute this Agreement and consummate the transactions
contemplated herein.
21. ENVIRONMENTAL REPORT. Attached to this Agreement as Exhibit N is the
following report (the "Environmental Report") of the Property, which Seller is
delivering to Purchaser, at Purchaser's request: Phase I Environmental Site
Assessment dated August 16, 1993 under Astex Report Number 00840493 prepared by
Krupp Mortgage Company Limited Partnership. Seller makes no representation or
warranty that the Environmental Report is accurate or complete. Purchaser
hereby releases Seller from any liability whatsoever with respect to the
Environmental Report or, including, without limitation, the matters set forth
in the Environmental Report, the accuracy and/or completeness of the
Environmental Report.
<PAGE>
22. LIMITATION OF SELLER'S LIABILITY. No general or limited partner of
Seller, nor any of its respective beneficiaries, shareholders, partners,
officers, agents, employees, heirs, successors or assigns shall have any
personal liability of any kind or nature for or by reason of any matter or
thing whatsoever under, in connection with, arising out of or in any way
related to this Agreement and the transactions contemplated herein, and
Purchaser hereby waives for itself and anyone who may claim by, through or
under Purchaser any and all rights to sue or recover on account of any such
alleged personal liability. Notwithstanding the foregoing to the contrary, for
any claims against Seller following Closing, if Seller fails to retain the net
proceeds of the Purchase Price up to a maximum amount of $500,000 (the "Cap")
for 120 days after the Closing Date, then the general partner of Seller shall
be liable for actual damages sustained by Purchaser as a result of Seller's
breach of a representation or warranty contained in Paragraph 19 of this
Agreement in an amount not to exceed the Cap. The foregoing Cap on liability
for a claim against the Seller following Closing shall not apply, and Seller's
general partner shall be liable, if Seller has entered into leases at the
Property for more than one year in breach of the representation identified in
Paragraph 19(B)(2) hereof and Purchaser makes a claim against Seller for a
breach of said representation within 120 days immediately following Closing.
23. ORGANIZATIONAL DOCUMENTS.
A. On or before the Closing Date, Purchaser will provide Seller's
attorney with copies of its organizational documents, including a certified
copy of its recorded certificate of limited partnership and a true copy of its
Partnership Agreement or a certified copy of its Articles of Incorporation,
corporate resolutions authorizing the transaction, and an incumbency
certificate, whichever is applicable.
B. On or before the Closing Date, Seller will deliver copies of its
partnership agreement and appropriate certificates of authority to the
Purchaser.
24. TIME OF ESSENCE. Time is of the essence of this Agreement.
25. NOTICES. Any notice or demand which either party hereto is required
or may desire to give or deliver to or make upon the other party shall be in
writing and may be personally delivered or given or made by overnight courier
such as Federal Express or by facsimile or made by United States registered or
certified mail addressed as follows:
TO SELLER: c/o The Balcor Company
2355 Waukegan Road
Suite A200
Bannockburn, Illinois 60015
Attn: Ilona Adams
with copies to: The Balcor Company
2355 Waukegan Road
Suite A200
Bannockburn, Illinois 60015
Attn: Al Lieberman
708/267-1600
708/317-4462 (FAX)
<PAGE>
and
Andrew D. Small, Esq.
Katten Muchin & Zavis
Suite 2100
525 W. Monroe Street
Chicago, Illinois 60661
312/902-5532
312/222-1061 (FAX)
TO PURCHASER: Alan George
c/o Equity Residential Properties Trust
Two North Riverside Plaza
Suite 450
Chicago, Illinois 60606-2639
312/466-3932
312/454-9678 (FAX)
with a copy to: Bruce Strohm
c/o Equity Residential Properties Trust
Two North Riverside Plaza
Suite 450
Chicago, Illinois 60606-2639
312/466-3624
312/454-0434 (FAX)
subject to the right of either party to designate a different address for
itself by notice similarly given. Any notice or demand so given shall be
deemed to be delivered or made on the next business day if sent by overnight
courier, or on the same day if sent by facsimile before the close of business,
or the next day if sent by facsimile after the close of business, or on the 4th
business day after the same is deposited in the United States Mail as
registered or certified matter, addressed as above provided, with postage
thereon fully prepaid. Any such notice, demand or document not given,
delivered or made by registered or certified mail or by overnight courier or by
facsimile as aforesaid shall be deemed to be given, delivered or made upon
receipt of the same by the party to whom the same is to be given, delivered or
made. Copies of all notices shall be served upon the Escrow Agent.
26. EXECUTION OF AGREEMENT AND ESCROW AGREEMENT. Purchaser will execute
three (3) copies of this Agreement and three (3) copies of the Escrow Agreement
and forward them to Seller for execution. Seller will forward one (1) copy of
the executed Agreement to Purchaser and will forward the following to the
Escrow Agent:
A. One (1) fully executed copy of this Agreement, and
B. Three (3) copies of the Escrow Agreement signed by the parties
with a direction to execute two (2) copies of the Escrow Agreement and deliver
a fully executed copy to the Purchaser and the Seller. Purchaser shall deposit
the initial $300,000 of Earnest Money immediately following receipt by
Purchaser of a fully executed Purchase Agreement and Escrow Agreement.
<PAGE>
27. GOVERNING LAW. The provision contained herein with reference to
retention of the Earnest Money in the event of Purchaser's default shall be
governed by the laws of the State of Illinois. The remaining provisions of
this Agreement shall be governed by the laws of the State of Florida.
28. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the parties and supersedes all other negotiations, understandings and
representations made by and between the parties and the agents, servants and
employees.
29. COUNTERPARTS. This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original but all of which shall
constitute one and the same instrument.
30. CAPTIONS. Paragraph titles or captions contained herein are inserted
as a matter of convenience and for reference, and in no way define, limit,
extend or describe the scope of this Agreement or any provision hereof.
31. FINANCIAL STATEMENTS. Seller acknowledges that audited financial
statements pertaining to the Property for one prior calendar year of operation
and the portion of the calendar year in which the Closing occurs up to the
Closing Date are required to be filed by the Purchaser with the Securities and
Exchange Commission after the Closing. Accordingly, Seller agrees that for a
period of six (6) months after the Closing Date it shall provide Purchaser and
its representatives with access to Seller's books and records after the Closing
upon reasonable advance notice in order to conduct the required audit, which
shall be done at Purchaser's cost and expense.
32. CONVEYANCE OF PARTNERSHIP INTERESTS. If requested to do so by
Purchaser, Seller hereby agrees, at no cost or expense to Seller, to cooperate
in good faith with Purchaser in structuring the conveyance of Property by the
Seller to Purchaser as a conveyance of title to such Property by the Seller
into a partnership or limited liability company having the Seller and/or
affiliates of the Seller as its sole partners (or members) and then, at
Closing, assigning to Purchaser the partnership (or membership) interests in
the partnership (or limited liability company). In such case, the Purchaser
hereby agrees to indemnify and hold the Seller harmless from and against any
and all loss, cost, expense, liability or damage (including reasonable
attorneys fees) incurred by Seller arising out of Seller's conveyance in and
out of such partnership (or limited liability company) provided that such loss,
cost, expense, liability or damage (including reasonable attorneys fees) would
not have been suffered or incurred by such Seller if such Property had been
conveyed directly by Seller to Purchaser. This Paragraph 32 shall survive the
Closing and the delivery of the Deed.
33. CONSIDERATION. On or before the execution of this Agreement,
Purchaser shall deliver to Seller One Hundred And No/100 Dollars ($100.00) cash
(the "Independent Contract Consideration"), which amount has been bargained for
and agreed to as consideration for Purchaser's right to purchase the Property
pursuant to this Agreement and for Seller's execution and delivery of this
Agreement. The Independent Contract Consideration is in addition to and
independent of all other consideration provided in this Agreement, and is
nonrefundable in all events.
<PAGE>
34. WAIVER OF DECEPTIVE TRADE PRACTICES-CONSUMER PROTECTION ACT.
Purchaser waives its rights under the Deceptive Trade Practices-Consumer
Protection Act, Section 17.41 et seq., Business & Commerce Code, a law that
gives consumers special rights and protections. After consultation with an
attorney/legal counsel of Purchaser's own selection, Purchaser voluntarily
consents to this waiver. Purchaser covenants, represents and warrants that
such attorney/legal counsel was not directly or indirectly identified,
suggested, or selected by Seller or an agent of Seller.
IN WITNESS WHEREOF, the parties hereto have put their hand and seal as of
the date set forth above.
Executed by Purchaser on PURCHASER:
July 22, 1996.
ERP OPERATING LIMITED PARTNERSHIP,
an Illinois limited partnership
By: Equity Residential Properties Trust,
a Maryland real estate investment trust
By: /s/ Alan W. George
------------------------------------
Name: Alan W. George
------------------------------------
Title: Senior Vice President
------------------------------------
Executed by Seller on SELLER:
July , 1996.
SONG I LIMITED PARTNERSHIP,
an Illinois limited partnership
By: Song I of Illinois, Inc., an Illinois
corporation, its general partner
By: /s/ Alan G. Lieberman
------------------------------------
Name: Alan G. Lieberman
------------------------------------
Title: Senior Vice President
------------------------------------
<PAGE>
BROKER JOINDER
Songbird Apartments
of PW Real Estate Group ("Seller's Broker") executed this
Agreement in its capacity as a real estate broker and acknowledges that the fee
or commission due it from Seller as a result of the transaction described in
this Agreement is as set forth in that certain Listing Agreement, dated April
23, 1996 between Seller and Seller's Broker (the "Listing Agreement").
Seller's Broker also acknowledges that payment of the aforesaid fee or
commission is conditioned upon the Closing and the receipt of the Purchase
Price by the Seller. Seller's Broker agrees to deliver a receipt to the Seller
at the Closing for the fee or commission due Seller's Broker and a release, in
the appropriate form, stating that no other fees or commissions are due to it
from Seller or Purchaser.
PW REAL ESTATE GROUP
By:
------------------------------------
<PAGE>
EXHIBITS
A - Legal
B - Personal Property
C - Escrow Agreement
D - Title Commitment
E - Deed
F - Bill of Sale
G - Assignment of Service Contracts
H - Assignment of Leases and Security Deposits
I - Notice to Tenants
J - Non-Foreign Affidavit
K - Compliance with Laws and Notice of Litigation
L - Rent Roll
M - Licenses, Permits and Service Contracts
N - Environmental Report
<PAGE>
