SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the quarter ended June 30, 1996 Commission file number 0-12433
CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XII
(Exact name of registrant as specified in its charter)
Illinois 36-3149589
(State of organization) (IRS Employer Identification No.)
900 N. Michigan Ave., Chicago, IL 60611
(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code 312/915-1987
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes X No
TABLE OF CONTENTS
PART I FINANCIAL INFORMATION
Item 1. Financial Statements . . . . . . . . . . . . . . . 3
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations. . . . . . . . 12
PART II OTHER INFORMATION
Item 3. Defaults Upon Senior Securities. . . . . . . . . . 13
Item 5. Other Information. . . . . . . . . . . . . . . . . 14
Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . 15
<TABLE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
CONSOLIDATED BALANCE SHEETS
JUNE 30, 1996 AND DECEMBER 31, 1995
(UNAUDITED)
ASSETS
------
<CAPTION>
JUNE 30, DECEMBER 31,
1996 1995
------------- -----------
<S> <C> <C>
Current assets:
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . $ 9,565,576 10,946,150
Rents and other receivables . . . . . . . . . . . . . . . . . . . . . 228,465 560,228
Prepaid expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . -- 116,454
Escrow deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,798,988 1,645,121
------------ ------------
Total current assets. . . . . . . . . . . . . . . . . . . . . 11,593,029 13,267,953
------------ ------------
Investment properties, at cost:
Land and leasehold interest . . . . . . . . . . . . . . . . . . . . 13,500,000 17,171,695
Buildings and improvements. . . . . . . . . . . . . . . . . . . . . 77,500,070 105,732,483
------------ ------------
91,000,070 122,904,178
Less accumulated depreciation . . . . . . . . . . . . . . . . . . . 31,022,762 42,824,687
------------ ------------
Total investment properties, net of
accumulated depreciation. . . . . . . . . . . . . . . . . . . 59,977,308 80,079,491
------------ ------------
Deferred expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . 345,203 407,246
Accrued rents receivable. . . . . . . . . . . . . . . . . . . . . . . . 834,398 914,627
Venture partners' deficits in ventures. . . . . . . . . . . . . . . . . -- 6,931
Escrow deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . 612,300 612,300
------------ ------------
$ 73,362,238 95,288,548
============ ============
LIABILITIES AND PARTNERS' CAPITAL ACCOUNTS (DEFICITS)
-----------------------------------------------------
Current liabilities:
Current portion of long-term debt . . . . . . . . . . . . . . . . . . $ 1,124,242 18,878,959
Accounts payable. . . . . . . . . . . . . . . . . . . . . . . . . . . 455,891 1,164,924
Accrued interest. . . . . . . . . . . . . . . . . . . . . . . . . . . 255,919 271,246
Accrued real estate taxes . . . . . . . . . . . . . . . . . . . . . . 1,579,699 2,381,207
Other current liabilities . . . . . . . . . . . . . . . . . . . . . . 77,418 217,434
------------ ------------
Total current liabilities. . . . . . . . . . . . . . . . . . . . 3,493,169 22,913,770
Tenant security deposits. . . . . . . . . . . . . . . . . . . . . . . . 305 21,530
Long-term debt, less current portion. . . . . . . . . . . . . . . . . . 54,876,709 59,465,831
------------ ------------
Commitments and contingencies
Total liabilities. . . . . . . . . . . . . . . . . . . . . . . . 58,370,183 82,401,131
Venture partners' equity in ventures. . . . . . . . . . . . . . . . . . 645,062 547,383
Partners' capital accounts (deficits):
General partners:
Capital contributions . . . . . . . . . . . . . . . . . . . . . . . 1,000 1,000
Cumulative net earnings (losses). . . . . . . . . . . . . . . . . . (7,977,348) (8,061,836)
Cumulative cash distributions . . . . . . . . . . . . . . . . . . . (899,640) (818,228)
------------ ------------
(8,875,988) (8,879,064)
------------ ------------
Limited partners (160,005 interests):
Capital contributions, net of offering costs. . . . . . . . . . . . 141,003,683 141,003,683
Cumulative net earnings (losses). . . . . . . . . . . . . . . . . . (68,931,986) (76,536,044)
Cumulative cash distributions . . . . . . . . . . . . . . . . . . . (48,848,716) (43,248,541)
------------ ------------
23,222,981 21,219,098
------------ ------------
Total partners' capital accounts (deficits) . . . . . . . . . . 14,346,993 12,340,034
------------ ------------
$ 73,362,238 95,288,548
============ ============
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
<TABLE>
CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
CONSOLIDATED STATEMENTS OF OPERATIONS
THREE AND SIX MONTHS ENDED JUNE 30, 1996 AND 1995
(UNAUDITED)
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30 JUNE 30
-------------------------- --------------------------
1996 1995 1996 1995
----------- ---------- ----------- ----------
<S> <C> <C> <C> <C>
Income:
Rental income . . . . . . . . . . . . . . . . . $ 3,963,574 5,604,633 9,478,143 11,398,238
Interest income . . . . . . . . . . . . . . . . 156,920 213,953 307,299 567,293
----------- ---------- ----------- ----------
4,120,494 5,818,586 9,785,442 11,965,531
----------- ---------- ----------- ----------
Expenses:
Mortgage and other interest . . . . . . . . . . 1,740,914 2,270,990 3,645,289 4,557,033
Depreciation. . . . . . . . . . . . . . . . . . 644,287 860,092 1,280,691 1,720,186
Property operating expenses . . . . . . . . . . 1,628,667 2,809,535 4,019,583 5,755,149
Professional services . . . . . . . . . . . . . 65,630 71,285 165,759 187,395
Amortization of deferred expenses . . . . . . . 15,519 16,059 31,578 32,117
Management fees to corporate
general partner . . . . . . . . . . . . . . . 55,557 -- 55,557 --
General and administrative. . . . . . . . . . . 111,538 131,454 235,903 222,746
----------- ---------- ----------- ----------
4,262,112 6,159,415 9,434,360 12,474,626
----------- ---------- ----------- ----------
Operating earnings (loss). . . . . . . . . (141,618) (340,829) 351,082 (509,095)
Venture partners' share of
ventures' operations. . . . . . . . . . . . . . (42,491) 89,171 (97,679) 175,057
----------- ---------- ----------- ----------
Net operating earnings (loss). . . . . . . (184,109) (251,658) 253,403 (334,038)
Gain on sale or disposition
of investment properties, net
of venture partners share . . . . . . . . . . . 7,435,143 -- 7,435,143 --
----------- ---------- ----------- ----------
Net income (loss) . . . . . . . . . . . . 7,251,034 (251,658) 7,688,546 (334,038)
=========== ========== =========== ==========
Net earnings (loss) per limited
partnership interests:
Net operating earnings (loss) . . . . . $ (1.10) (1.51) 1.52 (2.00)
Gain on sale or disposition of
investment properties, net. . . . . . 46.00 -- 46.00 --
----------- ---------- ----------- ----------
$ 44.90 (1.51) 47.52 (2.00)
=========== ========== =========== ==========
Cash distributions per
limited partnership
interest . . . . . . . . . . . . . . . . $ 35.00 -- 35.00 145.00
=========== ========== =========== ==========
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
<TABLE>
CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
CONSOLIDATED STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED JUNE 30, 1996 AND 1995
(UNAUDITED)
<CAPTION>
1996 1995
------------ -----------
<S> <C> <C>
Cash flows from operating activities:
Net earnings (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 7,688,546 (334,038)
Items not requiring (providing) cash:
Depreciation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,280,691 1,720,186
Amortization of deferred expenses . . . . . . . . . . . . . . . . . . . 31,578 32,117
Amortization of discount on long-term debt. . . . . . . . . . . . . . . 79,333 147,988
Venture partners' share of ventures' operations and gain on
sale or dispositon of investment properties . . . . . . . . . . . . . 104,610 (175,057)
Total gain on sale or disposition of investment properties. . . . . . . (7,442,074) --
Changes in:
Rents and other receivables . . . . . . . . . . . . . . . . . . . . . . 253,368 17,207
Prepaid expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . 116,454 96,129
Escrow deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . (89,295) 468,088
Accrued rents receivable. . . . . . . . . . . . . . . . . . . . . . . . 36,547 --
Accounts payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . (708,900) (50,200)
Accrued interest. . . . . . . . . . . . . . . . . . . . . . . . . . . . (15,327) 673,202
Accrued real estate taxes . . . . . . . . . . . . . . . . . . . . . . . 153,354 (218,160)
Tenant security deposits. . . . . . . . . . . . . . . . . . . . . . . . (11,331) (8,709)
Other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . (79,095) 321,687
------------ -----------
Net cash provided by (used in) operating activities . . . . . . . . 1,398,459 2,690,440
------------ -----------
Cash flows from investing activities:
Net sales and maturities (purchases) of short-term investments. . . . . . -- (6,800,891)
Additions to investment properties. . . . . . . . . . . . . . . . . . . . (1,077,064) (131,232)
Payment of deferred expenses. . . . . . . . . . . . . . . . . . . . . . . -- (1)
Escrow deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (64,572) (156,366)
Cash proceeds from sale of investment property. . . . . . . . . . . . . . 4,571,594 --
------------ -----------
Net cash provided by (used in) investing activities . . . . . . . 3,429,958 (7,088,490)
------------ -----------
Cash flows from financing activities:
Principal payments on long-term debt. . . . . . . . . . . . . . . . . . . (527,404) (820,713)
Distributions to limited partners . . . . . . . . . . . . . . . . . . . . (5,600,175) (23,200,725)
Distributions to general partners . . . . . . . . . . . . . . . . . . . . (81,412) (234,351)
------------ -----------
Net cash provided by (used in) financing activities . . . . . . . . (6,208,991) (24,255,789)
------------ -----------
Net increase (decrease) in cash and cash equivalents. . . . . . . . (1,380,574) (28,653,839)
Cash and cash equivalents, beginning of year. . . . . . . . . . . . 10,946,150 30,504,207
------------ -----------
Cash and cash equivalents, end of period. . . . . . . . . . . . . . $ 9,565,576 1,850,368
============ ===========
Supplemental disclosure of cash flow information:
Cash paid for mortgage and other interest . . . . . . . . . . . . . . . . $ 3,581,283 3,735,844
============ ===========
Non-cash investing and financing activities:
Sale of investment property:
Total sales proceeds, net of selling expenses . . . . . . . . . . . . $ 8,632,944 --
Principal balance due on mortgage payable . . . . . . . . . . . . . . (4,061,350) --
------------ -----------
Cash proceeds from sale of investment properties,
net of selling expenses . . . . . . . . . . . . . . . . . . . . $ 4,571,594 --
============ ===========
Disposition of investment property:
Balance due on long-term debt cancelled . . . . . . . . . . . . . . . $ 22,054,561 --
Discount on long-term debt cancelled. . . . . . . . . . . . . . . . . (4,220,143) --
Reduction of current assets and liabilities . . . . . . . . . . . . . 868,896 --
Reduction of investment property. . . . . . . . . . . . . . . . . . . (15,700,569) --
------------ -----------
Non-cash gain recognized due to lender realizing
upon security . . . . . . . . . . . . . . . . . . . . . . . . . $ 3,002,745 --
============ ===========
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XII
(A LIMITED PARTNERSHIP)
AND CONSOLIDATED VENTURES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1996 AND 1995
(UNAUDITED)
GENERAL
Readers of this quarterly report should refer to the Partnership's
audited financial statements for the year ended December 31, 1995 which are
included in the Partnership's 1995 Annual Report, as certain footnote
disclosures which would substantially duplicate those contained in such
audited financial statements have been omitted from this report.
The preparation of financial statements in accordance with GAAP
requires the Partnership to make estimates and assumptions that affect the
reported or disclosed amount of assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those
estimates.
Statement of Financial Accounting Standards No. 121 was adopted by the
Partnership on January 1, 1996.
TRANSACTIONS WITH AFFILIATES
The Partnership, pursuant to the Partnership Agreement, is permitted
to engage in various transactions involving the Corporate General Partner
and its affiliates including the reimbursement for salaries and salary-
related expenses of its employees, certain of its officers, and other
direct expenses relating to the administration of the Partnership and the
operation of the Partnership's investments. Fees, commissions and other
expenses required to be paid by the Partnership to the General Partners and
their affiliates as of June 30, 1996 and for the six months ended June 30,
1996 and 1995 were as follows:
Unpaid at
June 30,
1996 1995 1996
-------- ------- ---------
Property management
and leasing fees . . . . . . $113,242 468,674 --
Management fees to
corporate general
partner. . . . . . . . . . . 55,557 -- 55,557
Insurance commissions . . . . 18,052 35,909 --
Reimbursement (at cost)
for out-of-pocket
salary and salary-
related expenses
related to on-site and
other costs for the
Partnership and its
investment properties. . . . 54,089 138,407 49,679
-------- ------- -------
$240,940 642,990 105,236
======== ======= =======
Effective January 1, 1994, certain officers and directors of the
Corporate General Partner acquired interests in a company which, among
other things, has provided and continues to provide certain property
management services to certain of the properties owned by the Partnership.
Such acquisition had no effect on the fees payable by the Partnership under
any existing agreements with such company. The fees earned by such company
from the Partnership were $17,652 and $18,150 for the six months ended June
30, 1996 and 1995, respectively.
STONYBROOK APARTMENTS
On May 23, 1996, the Partnership, through the joint venture Stonybrook
Partners Limited Partnership, sold the land and related improvements known
as the Stonybrook Apartments I & II. The purchaser was not affiliated with
the Partnership or its General Partners and the sale price was determined
by arm's-length negotiations. The sale price of the land and improvements
was $8,632,944 (after deducting selling costs). A portion of the sales
proceeds was utilized to retire the mortgage debt with an outstanding
balance of $4,061,350. As a result of the sale, the Partnership recognized
a gain of $4,438,400 for financial reporting purposes and expects to
recognize a gain of approximately $7,700,000 for Federal income tax
purposes in 1996.
The property was classified as held for sale or disposition as of
January 1, 1996 and therefore was not subject to continued depreciation.
The accompanying consolidated financial statements include $782,604 and
$957,862 of revenues and $526,387 and $718,115 of operating expenses for
the six months ended June 30, 1996 and 1995. The property had a net
carrying value of $4,165,027 at December 31, 1995.
PERMIAN MALL
In anticipation of necessary major repairs and potential leasing
costs, the Partnership initiated discussions with the mortgage lender
regarding a modification of the loan. The Partnership was unable to secure
any such modification. Due to these facts, the Partnership was unable to
pay the 1995 real estate taxes assessed on the property in the amount of
$770,000 due in January, 1996 nor did it remit all of the scheduled debt
service payments since December 1995. Consequently, the Partnership
received a notice of default from the lender in February 1996, and as a
result, the lender then realized upon its security on April 2, 1996. As a
result of the disposition of the property, the Partnership recognized a
gain of $2,996,743 for financial reporting purposes and expects to realize
a gain of approximately $14,800,000 for Federal income tax purposes with no
corresponding distributable proceeds.
The property was classified as held for sale or disposition as of
January 1, 1996 and therefore was not subject to continued depreciation.
The accompanying consolidated financial statements include $1,515,221 and
$3,106,356 of revenues and $1,596,279 and $3,380,162 of operating expenses
for the six months ended June 30, 1996 and 1995. The property had a net
carrying value of $15,700,569 at December 31, 1995.
NATIONAL CITY CENTER
A tenant who occupies approximately 66,000 square feet (12.5% of the
building) whose lease is scheduled to expire in late 1996 has informed the
venture that it intends to vacate a major portion (approximately 41,000
square feet) upon expiration of its existing lease. The venture is
currently exploring its options with this space. However, there can be no
assurance that the venture will be able to obtain a renewal for any of the
space, or what the terms of any such renewal will be.
In addition, the venture was notified in August 1995 of the intention
of a tenant who occupies approximately 12,500 square feet and is currently
operating a restaurant on the building's plaza level, to terminate its
current lease effective August 31, 1996. Though the venture had been
negotiating with the current restaurant manager since August 1995 to
execute a new long term lease, the restaurant manager now intends to cease
operations on August 31, 1996 due to the restaurant's inability to generate
sufficient income to cover its increasing costs. The tenant will owe the
venture a lease termination fee of $45,000. The venture is currently
exploring its options and is negotiating with several replacement
restaurant tenants. However, there can be no assurance a replacement
tenant will be obtained.
ADJUSTMENTS
In the opinion of the Corporate General Partner, all adjustments
(consisting solely of normal recurring adjustments) necessary for a fair
presentation have been made to the accompanying figures as of June 30, 1996
and for the three and six months ended June 30, 1996 and 1995.
PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Reference is made to the notes to the accompanying financial
statements for additional information concerning the Partnership's
investments.
During the second quarter some of the Limited Partners in the
Partnership received from an unaffiliated third party an unsolicited tender
offer to purchase up to 7,639 Interests in the Partnership at $50 per
Interest. The Partnership recommended against acceptance of this offer on
the basis that, among other things, the offer price was inadequate. In
June such offer expired with approximately 1,211 Interests being purchased
by such unaffiliated third party pursuant to such offer. Subsequent to the
end of the quarter, an additional unaffiliated third party commenced an
unsolicited tender offer to purchase up to 7,840 Interests in the
Partnership at $55 per Interest. As of the date of this report, the
Partnership has not issued its recommendation on this new offer and such
offer remains outstanding. In addition, the Partnership has, from time to
time, received inquires from other third parties that may consider making
offers for Interests, including requests for the list of Limited Partners
in the Partnership. These inquiries are generally preliminary in nature.
There is no assurance that any other third party will commence an offer for
Interests, the terms of any such offer or whether any such offer, if made,
will be consummated, amended or withdrawn. The board of directors of JMB
Realty Corporation ("JMB") the corporate general partner of the
Partnership, has established a special committee (the "Special Committee")
consisting of certain directors of JMB to deal with all matters relating to
tender offers for Interests in the Partnership, including any and all
responses to such tender offers. The Special Committee has retained
independent counsel to advise it in connection with any potential tender
offers for Interests and has retained Lehman Brothers Inc. as financial
advisor to assist the Special Committee in evaluating and responding to any
additional potential tender offers for Interests. Expenses incurred in
connection with the previous tender offer and additional potential tender
offers for Interests are expected to increase Partnership operating
expenses in the third quarter.
In May 1996, the Partnership paid a distribution of previously
undistributed sales proceeds of $4,800,150 ($30 per interest) to the
Limited Partners and $48,486 to the General Partners and an operating
distribution of $800,250 ($5 per interest) to the Limited Partners and
$33,334 to the General Partners. At June 30, 1996, the Partnership had
cash and cash equivalents of approximately $9,566,000. In August 1996, the
Partnership expects to distribute approximately $4,000,000 ($25 per
interest) to the Limited Partners of proceeds related to the sale of the
Stonybrook Apartments. Such remaining funds are available for distribution
subject to future capital improvements and working capital requirements.
The General Partners of the Partnership expect to be able to conduct
an orderly liquidation of its remaining investment portfolio as quickly as
practicable. Therefore, the affairs of the Partnership are expected to be
wound up no later than 1999 (sooner if the properties are sold or disposed
of in the near term), barring unforeseen economic developments. Without a
dramatic improvement in market conditions, the Limited Partnership will
receive substantially less than half of their original investment.
RESULTS OF OPERATIONS
The decrease in cash and cash equivalents at June 30, 1996 as compared
to December 31, 1995 is primarily due to the distribution of sales proceeds
and operations as discussed above. This was offset by the cash proceeds
received (approximately $4,500,000) from the sale of the Stonybrook
Apartments.
The decrease in rents and other receivables, prepaid expenses, land
and leasehold interest, buildings and improvements, accumulated
depreciation, deferred expenses, current portion of long-term debt, accrued
real estate taxes, other current liabilities, tenant security deposits, and
long-term debt, less current portion at June 30, 1996 as compared to
December 31, 1995 is due primarily to the lender realizing upon its
security in the Permian Mall and the sale of the Stonybrook Apartments.
The increase in escrow deposits at June 30, 1996 as compared to
December 31, 1995 is primarily due to additional payments into the escrow
accounts for current and future leasing costs required by terms of the loan
secured by National City Center Building.
The decrease in accounts payable at June 30, 1996 as compared to
December 31, 1996 is primarily due to the January 1996 repayment of a
$604,570 bank overdraft in the Partnership's bank account at December 1995.
The decrease in rental income, mortgage and other interest, and
property operating expenses for the three and six months ended June 30,
1996 as compared to the same periods in 1995 is due primarily to the lender
realizing upon its security in the Permian Mall and the sale of the
Stonybrook Apartments.
The decrease in interest income for the three and six months ended
June 30, 1996 as compared to the same period in 1995 is primarily due to
the temporary investment of the First Interstate sale proceeds
(approximately $23,000,000) prior to the distribution to the partners in
February 1995.
The decrease in depreciation for the three and six months ended June
30, 1996 as compared to the same period in 1995 is primarily due to the
classification of the Permian Mall and the Stonybrook Apartments as assets
held for sale or disposition and therefore not subject to continued
depreciation.
The decrease in venture partner's share of venture's operations for
the three and six months ended June 30, 1996 as compared to the same period
in 1995 is primarily due to the sale of Carlyle Seattle's remaining
interest in First Interstate in December 1995.
The gain on sale of investment property for the three and six months
ended June 30, 1996 is due to the sale of the Stonybrook Apartments in May
1996 and to the lender realizing upon its security in the Permian Mall in
April 1996.
PART II. OTHER INFORMATION
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Reference is made to the Notes to Consolidated Financial Statements
filed with this report for discussions of default under, and the
unsuccessful attempt to obtain refinancing, modification or extension of
the mortgage loan secured by the Permian Mall which discussions are hereby
incorporated herein by reference.
<TABLE>
ITEM 5. OTHER INFORMATION
OCCUPANCY
The following is a listing of approximate occupancy levels by quarter for the Partnership's investment
properties owned during 1996.
<CAPTION>
1995 1996
------------------------------------- ------------------------------
At At At At At At At At
3/31 6/30 9/30 12/31 3/31 6/30 9/30 12/31
---- ---- ---- ----- ---- ---- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1. Stonybrook Apartments
I & II
Tucson, Arizona (a) . . 94% 77% 79% 86% 91% N/A
2. Permian Mall
Odessa, Texas (b). . . . 91% 92% 93% 92% 88% N/A
3. National City Center
Office Building
Cleveland, Ohio. . . . . 97% 98% 98% 97% 97% 97%
<FN>
- ------------
An "N/A" indicates that the property was not owned by the Partnership at the end of the quarter.
(a) Reference is made to the Notes for a description of the sale of this investment property in May 1996.
(b) Reference is made to the Notes for a description of the lender obtaining title to this property in April
1996.
</TABLE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits
3-A. The Prospectus of the Partnership dated June 21, 1982, as
supplemented on August 24, 1982, October 21, 1982, November 1, 1982,
December 22, 1982 and February 18, 1983, as filed with the Commission
pursuant to Rules 424(b) and 424(c), is hereby incorporated herein by
reference to the Partnership's Registration Statement on Form S-11 (File
No. 2-76443) dated June 21, 1982.
3-B. Amended and Restated Agreement of Limited Partnership set
forth as Exhibit A to the Prospectus, is incorporated by reference to the
Partnership's Registration Statement on Form S-11 (File No. 2-76443) dated
June 21, 1982.
3-C. Acknowledgement of rights and duties of the General Partners
of the Partnership between ABPP Associates, L.P. (a successor Associated
General Partner of the Partnership) and JMB Realty Corporation as of
December 31, 1995 is filed herewith.
4-A. Mortgage loan agreement between Carlyle/National City
Associates and New York Life Insurance Company dated November 15, 1983,
relating to the National City Center Office Building is hereby incorporated
herein by reference to the Partnership's report for December 31, 1992 on
Form 10-K (File No. 0-12433) dated March 19, 1993.
4-B. Amended and Restated Promissory Note, dated April 30, 1994,
between Carlyle/National City Associates and New York Life Insurance
Company relating to the National City Center Office Building is hereby
incorporated herein by reference to the Partnership's report for March 31,
1994 on Form 10-Q (File No. 0-12433) dated May 11, 1994.
4-C. Bondowner, Borrower, Remarketing Agent, Issuer and Trustee
Waiver, Appointment of and Acceptance by Successor Remarketing Agent,
Bondowner Election to Retain Bonds and Notice of Remarketing Rate, dated
October 1, 1994 relating to the refinancing of the first mortgage note
relating to the Stonybrook Apartments II is hereby incorporated by
reference to the Partnership's report on Form 10-K for December 31, 1995
(File No. 0-12433) dated March 27, 1995.
10-A. Acquisition documents including the venture agreement
relating to the purchase by the Partnership of an interest in the National
City Center Office Building in Cleveland, Ohio are hereby incorporated by
reference to the Partnership's report on Form 8-K (File No. 2-76443), dated
August 8, 1983.
10-B. Letter Agreement Regarding Option Closing between Carlyle
Seattle Associates and 999 Third Avenue, Ltd. relating to the First
Interstate Center in Seattle, Washington is hereby incorporated herein by
reference to the Partnership's report for January 26, 1996 on Form 8-K
(File No. 0-12433) dated December 15, 1995.
10-C. Assignment and Assumption of Partnership Interest between
Carlyle Seattle Associates and Wright Runstad Properties, L.P. is hereby
incorporated herein by reference to the Partnership's report for January
26, 1996 on Form 8-K (File No. 0-12433) dated December 15, 1995.
10-D. Sale documents and exhibits thereto relating to the
Partnership's sale of the Stonybrook Apartments in Tucson, Arizona are
filed herewith.
10-E. Substitute Trustee's deed and bill of sale related to the
Partnership's disposition of the Permian Mall in Odessa, Texas is filed
herewith.
27. Financial Data Schedule
(b) The following reports on Form 8-K were filed since the beginning of
the period covered by this report.
(i) The Partnership's Report on Form 8-K (File No. 0-
12433) for April 2, 1996 (describing the conveyance
of title of the Permian Mall in Odessa, Texas) was filed. This report was
dated April 17, 1996.
(ii) The Partnership's Report on Form 8-K (File No. 0-
12433) for May 23, 1996 (describing the sale of the
Stonybrook Apartments in Tucson, Arizona) was filed. This report was dated
June 4, 1996.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Company has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XII
BY: JMB Realty Corporation
(Corporate General Partner)
By: GAILEN J. HULL
Gailen J. Hull, Senior Vice President
Date: August 9, 1996
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following person in the capacity
and on the date indicated.
GAILEN J. HULL
Gailen J. Hull, Principal Accounting Officer
Date: August 9, 1996
EXHIBIT 3-C.
CARLYLE REAL ESTATE LIMITED PARTNERSHIP-XII
ACKNOWLEDGEMENT
This Acknowledgement is made and executed as of the 31st day of
December, 1995 by ABPP Associates, L.P., a limited partnership organized
under the laws of the State of Illinois ("ABPP"), and JMB Realty
Corporation, a Delaware corporation ("JMBRC").
WHEREAS, ABPP has acquired all of the partnership interests in Realty
Associates-XII, L.P., an Illinois limited partnership ("Realty-XII"), which
has served as the Associate General Partner of Carlyle Real Estate Limited
Partnership-XII, an Illinois limited partnership (the "Partnership"), and
ABPP has elected to continue the business of Realty-XII and has agreed to
continue as the Associate General Partner of the Partnership; and
WHEREAS, JMBRC has agreed to continue as the Corporate General
Partner of the Partnership.
NOW, THEREFORE, the parties hereby agree and acknowledge as follows:
1. ABPP and JMBRC both shall continue as general partners of the
Partnership, each with all of the rights and powers of general partners
therein, as set forth in the agreement of limited partnership of the
Partnership, as amended to date (the "Partnership Agreement") and in the
Revised Uniform Limited Partnership Act of the State of Illinois, and the
Partnership and its business shall be continued in all respects.
2. ABPP hereby agrees that it is a signatory to the Partnership
Agreement, together with JMBRC, and adopts and agrees to be bound by all of
the provisions of the Partnership Agreement, as amended from time to time
in accordance with the provisions of the Partnership Agreement.
3. ABPP and JMBRC agree that JMBRC is hereby authorized and
empowered, on behalf of ABPP, JMBRC, the Partnership or any of the
foregoing, to execute any and all documents, enter into any and all
agreements, or take any and all other actions (in each case in accordance
with and subject to the terms of the Partnership Agreement), in the name of
the Partnership or otherwise, as shall be necessary or appropriate in
connection with the business of the Partnership at any time. It is further
understood and agreed that the Chairman, President or any Vice President of
JMBRC (including any partner of ABPP who is Chairman, President or Vice
President of JMBRC) may act for and in the name of JMBRC in the exercise by
JMBRC of any of its rights and powers hereunder. In dealing with JMBRC (or
the Chairman, President or any Vice President thereof) so acting on behalf
of ABPP, JMBRC or the Partnership, no person shall be required to inquire
into the authority of JMBRC or such individual to bind the Partnership.
Persons dealing with the Partnership are entitled to rely conclusively upon
the power and authority of JMBRC (and of the Chairman, President or any
Vice President of JMBRC) as set forth herein.
4. ABPP and JMBRC agree to take any and all other actions as shall
be necessary or appropriate to reflect the continuation of the
Partnership's business, including the filing with any agency of any
document which shall be necessary or appropriate in connection therewith.
5. Nothing contained herein or contemplated hereby shall be deemed
to render ABPP or JMBRC liable for any obligations for which they would
otherwise not be liable as general partners of the Partnership.
IN WITNESS WHEREOF, the parties hereto have executed this
Acknowledgement as of the date first above written.
ABPP ASSOCIATES, L.P.
By: JMB Realty Corporation
General Partner
By: ______________________
Its:
JMB REALTY CORPORATION
By: ______________________
Its:
CARLYLE - XII - EXHIBIT D
PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS
(Stonybrook Apartments; Tucson, Arizona)
THIS AGREEMENT is made and entered into as of March __, 1996 by and
between STONYBROOK PARTNERS LIMITED PARTNERSHIP, an Illinois limited
partnership (hereinafter called "SELLER"), and PRIME RESIDENTIAL, L.P., a
Delaware limited partnership (hereinafter called "BUYER").
R E C I T A L S
A. Seller is the owner of that certain real property located at
4225 North First Avenue, in the City of Tucson, County of Pima, State of
Arizona, consisting primarily of a 411-unit apartment complex (the
"PREMISES") commonly known as "Stonybrook Apartments."
B. Buyer desires to purchase, and Seller desires to sell, such
Premises on the terms and conditions hereinafter documented.
NOW, THEREFORE, in consideration of the mutual undertakings of the
parties hereto, it is hereby agreed as follows:
1. PURCHASE AND SALE. Seller shall sell to Buyer, and Buyer shall
purchase from Seller, the land (the "LAND") described in Exhibit "A",
attached hereto and made a part hereof, together with all right, title and
interest of Seller in and to all improvements, structures, supplies and
fixtures located upon the Land, all right, title and interest of Seller in
and to those items of personal property located upon or about the Land and
described in Exhibit "B", attached hereto and made a part hereof (provided,
however, the Personal Property shall not include any computer equipment,
computer programs or related software), all right, title and interest of
Seller in and to the name "Stonybrook Apartments", and, to the extent
assignable, all right, title and interest of Seller in and to all leases,
contract rights, agreements, tenant lists, advertising material, telephone
exchange numbers, as-built plans and specifications for the improvements,
any and all guaranties, warranties, permits, approvals, licenses, and
certificates of occupancy respecting the Property (hereinafter,
collectively, the "PROPERTY"), all upon the terms, covenants and conditions
hereinafter set forth.
2. PURCHASE PRICE. The purchase price (the "PURCHASE PRICE") for
the Property shall be the sum of $10,250,000.
3. PAYMENT OF PURCHASE PRICE. The Purchase Price shall be paid to
Seller by Buyer as follows:
A. ESCROW DEPOSIT. Within three (3) business days of execution of
this Agreement by all parties, Buyer shall deliver $100,000 (which deposit,
together with all interest thereon earned while such deposit is held by
"Escrow Holder", as hereinafter defined, is herein called the "ESCROW
DEPOSIT") to Near North National Title Corporation, 222 North LaSalle
Street, Chicago, Illinois 60601, Attention: Ms. Lisa Novak (which company,
in its capacity as escrow holder hereunder, is called "ESCROW HOLDER").
The Escrow Deposit shall be delivered to Escrow Holder by wire transfer of
immediately available federal funds or by check evidencing good funds. The
amounts deposited hereunder shall be held by Escrow Holder as a deposit
against the Purchase Price in accordance with the terms and provisions of
this Agreement. At all times that the Escrow Deposit is being held by the
Escrow Holder, the Escrow Deposit shall be invested by Escrow Holder in the
following investments ("APPROVED INVESTMENTS"): (i) United States Treasury
obligations, (ii) United States Treasury-backed repurchase agreements
issued by a major money center banking institution reasonably acceptable to
Seller and Buyer, or (iii) such other manner as may be reasonably agreed to
by Seller and Buyer. The Escrow Deposit shall be disbursed by Escrow
Holder only as provided in this Agreement.
B. ASSUMPTION OF BOND FINANCING. A portion of the Purchase Price
shall be payable by Buyer assuming the obligations of Seller under the
"Bond Documents" (as defined in Exhibit "C" attached hereto and made apart
hereof), such portion of the Purchase Price so payable being an amount
equal to the outstanding principal balance of the Bond Documents as of the
"Closing Date", as hereinafter defined (such amount being herein called the
"OUTSTANDING BOND AMOUNT"). The Outstanding Bond Amount as of the Closing
Date is anticipated to be approximately $4,046,350.
C. CLOSING PAYMENT. The Purchase Price (i.e., $10,250,000 minus
the Outstanding Bond Amount), as adjusted by the prorations and credits
specified herein, shall be paid in cash on the Closing Date (the amount to
be paid under this subparagraph C being herein called the "CLOSING
PAYMENT"). The Closing Payment is anticipated to be approximately
$6,203,650 (prior to adjustment for the prorations and credits provided for
in this Agreement).
4. CONDITIONS PRECEDENT
A. TITLE MATTERS.
(1) TITLE REPORT. Seller has ordered (and promptly upon receipt
shall deliver to Buyer) a copy of a preliminary title report ("PRELIMINARY
TITLE REPORT") covering the Property from First American Title Insurance
Company (which company, in its capacity as title insurer hereunder, is
herein called the "TITLE COMPANY"), together with copies of all exceptions
to title or documents referenced or related thereto. In addition, Seller
has ordered (and promptly upon receipt shall deliver to Buyer) updates of
those certain ALTA as-built surveys of the Property dated August, 1982 and
April, 1983, prepared by Stitzer Johnson & Associates, which surveys
(collectively, the "SURVEY") shall be dated and certified after the date of
this Agreement, shall be certified to Buyer and Title Company and shall be
in conformance with the requirements set forth in Exhibit "D" attached
hereto and made a part hereof. In addition, Seller shall obtain (and
promptly upon receipt shall deliver to Buyer) searches of all Uniform
Commercial Code financing statements and tax liens related to the Property
filed against Seller, as debtor, in the appropriate State of Arizona or
Pima County public offices. If Buyer shall fail to deliver written notice
("TITLE OBJECTION NOTICE") setting forth those title, UCC and tax lien
search and survey matters to which Buyer objects on or before the date
which is ten (10) business days following Buyer's receipt of the last of
the Preliminary Title Report, UCC and tax lien searches and the Survey (the
"TITLE REVIEW PERIOD"), Buyer shall be deemed to have approved the
exceptions to title shown on the Preliminary Title Report, the matters
disclosed by the UCC and tax lien searches, and the matters disclosed on
the Survey. If Buyer shall timely deliver a Title Objection Notice
hereunder, Seller shall use commercially reasonable efforts to either (a)
cause such disapproved matter to be removed on the Closing Date, or
(b) obtain a title endorsement (if available and subject to Buyer's
reasonable approval) insuring over such disapproved matter; provided,
however, Seller shall have no liability if, after using commercially
reasonable efforts as aforesaid, such exceptions are not removed or insured
over for any reason as of the Closing Date (and in such event, unless the
same shall be waived by Buyer, the obligation of Seller to sell, and Buyer
to buy, the Property as herein provided shall terminate, Buyer shall
receive a return of the Escrow Deposit and Seller and Buyer shall have no
further obligations in connection herewith). Notwithstanding anything to
the contrary contained in this Agreement, such commercially reasonable
efforts shall not include any obligation to institute legal proceedings or
to expend any monies in connection therewith; provided, however, Seller
shall be obligated to remove (or cause the Title Company to affirmatively
insure over) at Seller's expense: (i) any deeds of trust securing any
financing obtained by Seller (other than Bond Documents), (ii) any
mechanic's or materialmen's liens for work done by or on behalf of Seller,
(iii) any tax or judgment liens against Seller, and (iv) any other monetary
liens against Seller (provided Seller shall not be obligated to expend more
than $50,000 in connection with this clause (iv)). Approval by Buyer of
any additional exceptions to title or additional UCC and tax lien search or
survey matters disclosed after the end of the Title Review Period shall be
a condition precedent to Buyer's obligation to purchase the Property.
Unless Buyer gives written notice that it disapproves any such additional
exceptions to title or UCC and tax lien search or survey matters, stating
the exceptions so disapproved, on or before the sooner to occur of ten (10)
business days after receipt of written notice thereof or the Closing Date,
Buyer shall be deemed to have approved said exceptions or survey matters.
If for any reason, on or before the Closing Date Seller does not cause such
exceptions to title or UCC and tax lien search survey matters which Buyer
disapproves (to the extent Buyer is permitted hereunder to so disapprove)
to be removed at no cost or expense to Buyer (Seller having the right but
not the obligation to do so), the obligation of Seller to sell, and Buyer
to buy, the Property as herein provided shall terminate (and Seller and
Buyer shall have no further obligations in connection herewith). Buyer
shall have the option to waive the condition precedent set forth in this
paragraph 4A(1) by notice to Seller. In the event of such waiver, such
condition shall be deemed satisfied. All matters set forth on the
Preliminary Title Report which are not timely objected to by Buyer are
herein called the "PERMITTED EXCEPTIONS". The term "Permitted Exceptions"
shall additionally include (i) any title matters objected to by Buyer,
which objections are subsequently waived in writing by Buyer, and (ii) any
title matters objected to by Buyer, which objections are cured to Buyer's
satisfaction as herein provided.
(2) EXCEPTIONS TO TITLE. Buyer shall be obligated to accept title
to the Property, subject to the following exceptions to title:
(a) Real estate taxes and assessments not yet due and payable;
(b) The Bond Documents; and
(c) The Permitted Exceptions.
Conclusive evidence of the availability of such title shall be the
willingness of Title Company to issue to Buyer on the Closing Date an ALTA
owner's title insurance policy with "extended coverage" in the standard
form issued by Title Company on the State of Arizona ("OWNER'S POLICY"), in
the face amount of the Purchase Price, which policy shall (i) show title to
the Property to be vested of record in Buyer, (ii) show the Permitted
Exceptions to be the only exceptions to title, and (iii) contain such
endorsements as Buyer shall require (and the Title Company shall agree to
issue) prior to the expiration of the Title Review Period.
B. DUE DILIGENCE REVIEWS. Except for title and survey matters
(which shall be subject to the provisions of paragraph 4A above), Buyer
shall have until 5:00 p.m. (Central time) on May 1, 1996 (the "DUE
DILIGENCE PERIOD") within which to complete all of Buyer's due diligence
examinations, reviews and inspections of all matters pertaining to the
purchase of the Property, including but not limited to all leases, bond
documents (including complete copies of any and all Bond Documents,
including but not limited to any amendments, modifications or extensions
relating thereto), service contracts, and all physical, environmental and
compliance matters and conditions respecting the Property. During the Due
Diligence Period, Seller shall continue to provide Buyer with reasonable
access to the Property upon reasonable advance notice and either has or
shall hereafter make available to Buyer, to the extent in Seller's
possession, true and correct copies of such leases, bond documents, service
contracts and other contracts and agreements known to Seller which
presently affect the Property (and such other documents reasonably
requested by Buyer and reasonably agreed to by Seller). Buyer shall
promptly commence, and shall diligently and in good faith pursue, its due
diligence review hereunder. Buyer shall at all times conduct its due
diligence review, inspections and examinations in a manner so as to not
cause damage, loss, cost or expense to Seller or the Property and so as to
not unreasonably interfere with or disturb any tenant at the Property, and
Buyer will indemnify, defend, and hold Seller and the Property harmless
from and against any such damage, loss, cost or expense caused by Buyer,
its agents or representatives (the foregoing obligation surviving any
termination of this Agreement). In no event shall Buyer make any intrusive
physical testing (environmental, structural or otherwise) at the Property
(such as soil borings or the like) without Seller's prior written consent,
which consent shall not be unreasonably withheld or unduly delayed (and
shall in all events promptly return the Property to its prior condition and
repair thereafter). Without limitation on the foregoing, in no event shall
Buyer contact any tenant of the Property without Seller's consent. Seller
shall have the right, at its option, to cause a representative of Seller to
be present at all inspections, reviews and examinations conducted
hereunder. In the event of termination of this Agreement, Buyer shall
return all documents and other materials furnished to or on behalf of Buyer
by Seller hereunder. Buyer shall keep all information or data received or
discovered in connection with any of the inspections, reviews or
examinations strictly confidential; provided, however, that Buyer shall be
entitled to disclose such information to Buyer's attorneys, accountants and
prospective debt and equity financing sources who reasonably need to be
informed in connection with Buyer's determinations hereunder (and who
shall, in turn, be required to keep such information confidential). If, on
or before the expiration of the Due Diligence Period, based upon such
review, examination or inspection, Buyer shall determine, in its sole and
absolute discretion, that it intends to acquire the Property, then Buyer
shall promptly notify Seller of such determination in writing (such notice
being herein called the "APPROVAL NOTICE"). If Buyer shall fail to deliver
the Approval Notice to Seller on or before the expiration of the Due
Diligence Period, Buyer shall be deemed to have elected not to proceed with
the acquisition of the Property, whereupon this Agreement, and the
obligations of the parties hereunder, shall terminate and the Escrow
Deposit shall be promptly returned to Buyer (and, thereafter, Buyer shall
have no further right to terminate this Agreement pursuant to this
paragraph 4B).
C. BOND FINANCING MATTERS.
(1) ASSUMPTION OF BOND DOCUMENTS. Receipt of the written
consent of all parties under the Bond Documents whose consent to the
assumption by Buyer of such Bond Documents is required thereunder,
including approval of the form of any assignment and assumption agreements
and any forms or agreements related to the transfer of the Bonds
(collectively, the "BOND ASSIGNMENT, ASSUMPTION AND TRANSFER AGREEMENTS")
on or before May 1, 1996, ("BOND APPROVAL PERIOD") shall be a condition
precedent to Seller's obligation to sell, and Buyer's obligation to
purchase, the Property; provided, however, if the foregoing consents have
not theretofore been obtained then Buyer shall have the right to extend the
Bond Approval Period for an additional fifteen (15) days (i.e., until
May 15, 1996) by giving written notice thereof to Seller on or before
May 1, 1996. Buyer shall pay any transfer, assumption, letter of credit or
other similar fees and costs (including reasonable attorneys' fees) imposed
by any of the parties from whom consent is required under the Bond
Documents with respect to such consent and assumption (it being understood
that Buyer shall have the right to determine whether such costs will be
acceptable to Buyer during the Bond Approval Period). Buyer shall
reasonably cooperate with Seller in connection with such consent,
assumption and letter of credit replacement contemplated herein. Without
limitation therein, Buyer shall within ten (10) days of the date of this
Agreement make formal bond assumption application and in connection
therewith shall promptly deliver such information, including financial
information, respecting Buyer as any of such parties may request. Seller's
sole obligation in connection with the consent matters herein contemplated
shall be to utilize reasonable efforts to assist Buyer in obtaining all
consents to the transactions contemplated hereby which may be required
under the Bond Documents. While such reasonable efforts obligation does
not include any obligation to institute legal proceedings or to pay any
monies to any person or entity in order to obtain such consent, any
expenses incurred by Seller, including but not limited to attorneys' fees,
associated with Seller's cooperation hereunder shall be paid by Seller. If
Buyer shall determine that all consents (including the costs attendant
thereto) are acceptable to Buyer, Buyer shall promptly give Seller written
notice thereof (such notice being herein called the "BOND APPROVAL
NOTICE"). If Buyer shall fail to deliver the Bond Approval Notice prior to
the expiration of the Bond Approval Period, the obligation of Seller to
sell, and Buyer to purchase, the Property shall terminate, and the Escrow
Deposit shall be promptly returned to Buyer.
(2) ACQUISITION OF BONDS. The acquisition of the "Bonds" (as
defined in Exhibit "C" hereto) by Buyer or its "Permitted Assignee" (as
hereinafter defined) on the Closing Date shall be a condition to the
obligations of Seller to sell, and Buyer to purchase, the Property.
Concurrently with, and as a part of its obtaining the consents to the
assumption of the Bond Documents as provided above, Buyer shall determine,
in its sole and absolute discretion, whether the terms applicable to
Buyer's acquisition of the Bonds as aforesaid (including all costs and
expenses in connection therewith, which costs and expenses shall be paid by
Buyer) will be acceptable to Buyer. If Buyer shall deliver the Bond
Approval Notice as set forth above, Buyer shall be deemed to have approved
the terms of Buyer's acquisition of the Bonds. If Buyer shall fail to
deliver the Bond Approval Notice on or before the expiration of the Bond
Approval Period, or if at closing, the Bonds shall not be transferred to
Buyer as contemplated herein, the obligation of Seller to sell, and Buyer
to purchase, the Property shall terminate, and the Escrow Deposit shall be
promptly returned to Buyer. Without limitation thereon, in no event shall
Buyer have any obligation to acquire the Bond Documents if for any reason
the Property is not transferred to Buyer on the Closing Date as
contemplated herein.
D. PERFORMANCE BY SELLER. The performance and observance, in all
material respects, by Seller of all covenants and agreements of this
Agreement to be performed or observed by Seller prior to or on the Closing
Date shall be a condition precedent to Buyer's obligation to purchase the
Property. In addition, in the event that the "Seller Closing Certificate"
(as hereinafter defined) shall disclose any material adverse changes in the
representations and warranties of Seller contained in paragraph 7A below
which are not otherwise permitted or contemplated by the terms of this
Agreement (and which are not cured within ten (10) days after written
notice from Buyer specifying such unpermitted changes is received by
Seller), then Buyer shall have the right to terminate this Agreement.
Buyer shall have the option to waive the condition precedent set forth in
this paragraph 4D by written notice to Seller. In the event of such
waiver, such condition shall be deemed satisfied.
E. PERFORMANCE BY BUYER. The performance and observance, in all
material respects, by Buyer of all covenants and agreements of this
Agreement to be performed or observed by it prior to or on the Closing Date
shall be a condition precedent to Seller's obligation to sell the Property.
In addition, in the event that the "Buyer Closing Certificate" (as
hereinafter defined) shall disclose any material adverse changes in the
representations and warranties of Buyer contained in paragraph 7B below
which are not permitted or contemplated by the terms of this Agreement (and
which are not cured within ten (10) days after written notice from Buyer
specifying such unpermitted changes is received by Buyer), then Seller
shall have the right to terminate this Agreement. Seller shall have the
option to waive the condition precedent set forth in this paragraph 4E by
written notice to Buyer. In the event of such waiver, such condition shall
be deemed satisfied.
5. CLOSING PROCEDURE TRANSACTIONS. Subject to satisfaction (or
waiver) of all covenants and agreements provided for in this Agreement in
the manner contemplated herein, the sale and purchase herein provided shall
be consummated at a closing conference ("CLOSING CONFERENCE"), which shall
be held on the Closing Date at the offices of Escrow Holder in Chicago,
Illinois. As used herein, "CLOSING DATE" means May 15, 1996, or such
earlier date as may be agreed upon by Buyer and Seller in writing.
A. ESCROW. By the Closing Date, the parties shall deliver to
Escrow Holder, on behalf of the Title Company, the following: (1) by
Seller, a duly executed and acknowledged original special warranty deed
("DEED") in favor of Buyer or its Permitted Assignee, in the form of
Exhibit "E" attached hereto and made a part hereof (subject only to the
Permitted Exceptions), and (2) by Buyer, the Closing Payment in immediately
available federal funds. Such deliveries shall be made pursuant to closing
procedure instructions ("CLOSING PROCEDURE INSTRUCTIONS") to be executed
among Buyer, Seller and Title Company in form reasonably acceptable to such
parties in order to effectuate the intent hereof. The conditions to the
closing of such escrow shall include the Title Company's receipt of the
Deed, the Closing Payment, the commitment of the Title Company to issue the
Owner's Policy in the form specified in paragraph 4A(2) hereof, and an
authorization notice from each of Buyer and Seller (and each of Buyer and
Seller shall be obligated to deliver such authorization notice at the
Closing Conference as soon as it is reasonably satisfied that the other
party is in a position to deliver the items to be delivered by such other
party under subparagraph B below).
B. DELIVERY TO PARTIES. Upon the satisfaction of the conditions
set forth in the Closing Procedure Instructions, then on the Closing Date
(1) the Deed shall be delivered to Buyer by Title Company's depositing the
same for recordation, (2) the Closing Payment shall be delivered to Seller
(3) the Escrow Deposit shall be returned to Buyer, and (4) at the Closing
Conference, the following items shall be delivered:
(1) SELLER DELIVERIES. Seller shall deliver to Buyer the
following:
(a) A duly executed and acknowledged bill of sale, assignment and
assumption agreement ("GENERAL ASSIGNMENT AND ASSUMPTION AGREEMENT") in the
form of Exhibit "F" attached hereto and made a part hereof;
(b) Appropriate documentation to evidence the assignment and
assumption of the Bond Documents as may be reasonably required by Buyer or
the parties thereto in order to effectuate the release, assignment and
assumption transactions respecting the Bond Documents as contemplated in
this Agreement, including the original Bond and the Bond Assignment,
Assumption and Transfer Agreements;
(c) A certificate of Seller ("SELLER CLOSING CERTIFICATE") updating
the representations and warranties contained in paragraph 7A hereof to the
Closing Date (and including an updated certified rent roll) and noting any
changes thereto;
(d) Duly executed and acknowledged certificates regarding the "non-
foreign" status of Seller satisfying both federal and state law
requirements;
(e) A letter to each tenant regarding the sale of the Property;
(f) Executed originals (or certified copies if the originals are
not in Seller's possession) of the leases and service contracts will either
be delivered at the closing or retained on Buyer's behalf at the Property
along with the Leases and other on-going operating files for the Property
(including all lease files maintained by Seller for all current tenants and
all tenants who have vacated the Property within 90 days prior to closing;
(g) Evidence reasonably satisfactory to Buyer and Escrow Holder
respecting the due organization of Seller and the due authorization and
execution of this Agreement and the documents required to be delivered
hereunder; and
(h) Such additional documents as may be reasonably required by
Buyer and Title Company in order to consummate the transactions hereunder
(which documents shall be subject to Seller's reasonable approval).
(2) BUYER DELIVERIES. Buyer shall deliver to Seller the following:
(a) A duly executed and acknowledged General Assignment and
Assumption Agreement;
(b) Appropriate documentation to evidence the assignment and
assumption of the Bond Documents as may be reasonably required by Buyer or
the parties thereto in order to effectuate the release, assignment and
assumption transactions respecting the Bond Documents as contemplated in
this Agreement, including the original Bond and the Bond Assignment,
Assumption and Transfer Agreements;
(c) A certificate of Buyer ("BUYER CLOSING CERTIFICATE") updating
the representations and warranties contained in paragraph 7B hereof to the
Closing Date and noting any changes thereto;
(d) Evidence reasonably satisfactory to Seller and Escrow Holder
respecting the due organization of Buyer and the due authorization and
execution of this Agreement and the documents required to be delivered
hereunder; and
(e) Such additional documents as may be reasonably required by
Seller and Title Company in or to consummate the transactions hereunder
(which documents shall be subject to Buyer's reasonable approval).
C. ADDITIONAL DELIVERIES. The Owner's Policy shall be delivered
to Buyer in the manner contemplated and the Bonds shall be assigned to
and/or acquired by Buyer or its Permitted Assignee, as herein contemplated.
D. CLOSING COSTS. Seller shall pay (i) the recording charges
attributable to the Deed, (ii) one-half of the escrow fees of Escrow
Holder, (iii) the title insurance premiums (at a rate not in excess of
standard issue rates) attributable to the ALTA "extended coverage" provided
in the Owner's Policy, and (iv) the costs of the Survey. Buyer shall pay
(i) one-half of the escrow fees of Escrow Holder, (ii) all title insurance
premiums attributable to the Owner's Policy for any endorsements to the
Owner's Policy, to the extent any of the foregoing is requested by Buyer,
and (iii) all costs and expenses related to Buyer's due diligence
examinations, reviews and inspections. Seller and Buyer shall each pay its
respective shares of prorations as hereinafter provided.
E. PRORATIONS.
(1) ITEMS TO BE PRORATED. The following shall be prorated between
Seller and Buyer as of the Closing Date:
(a) All real estate taxes and assessments on the Property for the
current year. In no event shall Seller be charged with or be responsible
for any increase in the taxes on the Property resulting from the sale of
the Property or from any improvements made or leases entered into on or
after the Closing Date. In the event that any assessments on the Property
are payable in installments, then the installment for the current period
shall be prorated (with Buyer assuming the obligation to pay any
installments due after the Closing Date).
(b) All fixed and additional rentals under the tenant leases,
security deposits and other tenant charges. Seller shall deliver or
provide a credit in an amount equal to all prepaid rentals for periods
after the Closing Date and all security deposits (to the extent the
foregoing were made by tenants under the tenant leases and are not applied
or forfeited prior to the Closing Date) to Buyer on the Closing Date. In
connection therewith, Seller agrees not to apply any security deposits
between the date hereof and the Closing Date except with respect to leases
which terminate (and the premises demised thereby vacated) prior to the
Closing Date. Rents which are delinquent as of the Closing Date shall not
be prorated on the Closing Date. Buyer shall include such delinquencies in
its normal billing and shall diligently pursue the collection thereof in
good faith after the Closing Date (but Buyer shall not be required to
litigate or declare a default in any Lease). To the extent Buyer receives
rents on or after the Closing Date, such payments shall be applied first
toward then current rent owed to Buyer in connection with the applicable
Lease for which such payments are received, and any excess monies received
shall be applied toward the payment of any delinquent rents, with Seller's
share thereof being promptly delivered to Seller. Buyer may not waive any
delinquent rents nor modify a tenant lease so as to reduce or otherwise
affect amounts owed thereunder for any period in which Seller is entitled
to receive a share of charges or amounts without first obtaining Seller's
written consent (unless the amounts due Seller with respect to such tenant
lease shall be paid concurrently therewith). Seller hereby reserves the
right to pursue any remedy against any tenant owing delinquent rents and
any other amounts to Seller for 60 days or more as of the Closing Date.
Buyer shall reasonably cooperate with Seller (at Seller's expense) in any
collection efforts hereunder (but shall not be required to litigate or
declare a default in any tenant lease). With respect to delinquent rents
and any other amounts or other rights of any kind respecting tenants who
are no longer tenants of the Property as of the Closing Date, Seller shall
retain all rights relating thereto.
(c) The interest portion of the monthly amortization payment,
together with any other regular monthly payments, under the Bond Documents.
(d) All utility costs shall be paid by Seller up to the Closing
Date with the obtaining of final meter readings through the Closing Date.
(e) Any and all prepaid items (including lump sum payments, if any,
under Service Agreements or other similar agreements assumed by Buyer
hereunder).
(f) Such additional adjustments as are normally made in connection
with the sale of property similar to the Property in Pima County, Arizona
to the extent not otherwise in this Agreement.
(2) CALCULATION. The prorations and payments shall be made on the
basis of a written statement submitted to Buyer and Seller by Escrow Holder
prior to the Close of Escrow and approved by Buyer and Seller (and shall be
determined based on the appropriate income and expenses for periods prior
to the Closing Date being allocated to Seller, and appropriate income and
expenses for periods on or after the Closing Date being allocated to
Buyer). In the event any prorations or apportionments made under this
subparagraph D shall prove to be incorrect for any reason, then any party
shall be entitled to an adjustment to correct the same. Any item which
cannot be finally prorated because of the unavailability of information
shall be tentatively prorated on the basis of the best data then available
and reprorated when the information is available. The obligations of
Seller and Buyer under this paragraph 5D(2) shall survive the closing.
6. CONDEMNATION OR DESTRUCTION OF PROPERTY. In the event that,
after the date hereof but prior to the Closing Date, either any portion of
the Property is taken pursuant to eminent domain proceedings or any of the
improvements on the Property are damaged or destroyed by any casualty,
Seller shall have no obligation to repair or replace any such damage or
destruction. Seller shall, upon consummation of the transaction herein
provided, assign to Buyer all claims of Seller respecting any condemnation
or casualty insurance coverage, as applicable, and all condemnation
proceeds or proceeds from any such casualty insurance received by Seller on
account of any casualty (the damage from which shall not have been repaired
by Seller prior to the Closing Date), as applicable. In connection with
any assignment of insurance proceeds hereunder, Seller shall credit Buyer
with an amount equal to the applicable deductible amount under Seller's
insurance. In the event the condemnation award or the cost of repair of
damage to the Property on account of a casualty, as applicable, shall
exceed $100,000 (or if a casualty is uninsured, and Seller does not elect
to credit Buyer with an amount equal to the cost to repair such uninsured
casualty, Seller having the right, but not the obligation, to do so), Buyer
may, at its option, terminate this Agreement by notice to Seller, given on
or before the Closing Date and receive a refund of the Escrow Deposit.
7. REPRESENTATIONS, WARRANTIES AND COVENANTS.
A. REPRESENTATIONS, WARRANTIES AND COVENANTS OF SELLER.
(1) GENERAL DISCLAIMER. Except as specifically set forth in
paragraph 7A(2) below or in the documents delivered by Seller at closing
pursuant to paragraph 5B(1) hereof, the sale of the Property hereunder is
and will be made on an "as is" basis, without representations and
warranties of any kind or nature, express, implied or otherwise, including,
but not limited to, any representation or warranty concerning title to the
Property, the physical condition of the Property (including, but not
limited to, the condition of the soil or the Improvements), the
environmental condition of the Property (including, but not limited to, the
presence or absence of hazardous substances on or respecting the Property),
the compliance of the Property with applicable laws and regulations
(including, but not limited to, zoning and building codes or the status of
development or use rights respecting the Property), the financial condition
of the Property or any other representation or warranty respecting income,
expenses, charges, liens or encumbrances, rights or claims on, affecting or
pertaining to the Property or any part thereof. Buyer acknowledges that,
during the Due Diligence Period, Buyer will examine, review and inspect all
matters which in Buyer's judgment bear upon the Property and its value and
suitability for Buyer's purposes. Except as to matters specifically set
forth in paragraph 7A(2) below or in the documents delivered by Seller at
closing pursuant to paragraph 5B(1) hereof, Buyer will acquire the Property
solely on the basis of its own physical and financial examinations, reviews
and inspections and the title insurance protection afforded by the Owner's
Policy.
(2) LIMITED REPRESENTATIONS AND WARRANTIES OF SELLER. Seller
hereby represents and warrants to Buyer that Seller has no present actual
knowledge that any of the following statements is untrue (and, for this
purpose, Seller's knowledge shall mean the knowledge of Julie Strocchia,
after having the on-site property manager for Heitman Properties, Ltd.
("HEITMAN"), Seller's third party management company, review the
representations and warranties contained herein):
(a) RENT ROLL. Attached as Exhibit "H" and made a part hereof is a
true, complete and accurate list, as of the date thereof, of all tenant
leases respecting the Property ("RENT ROLL"). Except as set forth in the
Rent Roll, neither Seller nor any tenant under the tenant leases is in
monetary default or material non-monetary default under any of such tenant
leases that remains uncured.
(b) LITIGATION. There is no pending action, litigation,
condemnation or other proceeding (including, without limitation, any
eminent domain proceeding) against the Property or against Seller (or any
of its partners or principals) with respect to the Property.
(c) COMPLIANCE. Seller has received no written notice from any
governmental authority having jurisdiction over the Property to the effect
that the Property is not in compliance with applicable laws and ordinances,
including, without limitation, applicable zoning and use requirements and
restrictions and applicable permits, licenses and certificates.
(d) SERVICE AGREEMENTS. Other than those which are cancelable on
30 days' notice without payment of any fees, there are no service
agreements or contracts ("SERVICE AGREEMENTS") or other agreements (other
than as expressly set forth in this Agreement) relating to the Property
which will be in force on the Closing Date, except as described in
Exhibit "I" attached hereto and made a part hereof. Neither Seller nor any
other party to any of the Service Agreements is in monetary default or
material non-monetary default thereunder that remains uncured.
(e) DUE AUTHORITY. This Agreement and all agreements, instruments
and documents herein provided to be executed or to be caused to be executed
by Seller are and on the Closing Date will be duly authorized, executed and
delivered by and are binding upon Seller. Seller is a limited partnership,
duly organized and validly existing under the laws of the State of
Illinois, authorized to transact business in the State of Arizona, and is
duly authorized and qualified to do all things required of it under this
Agreement. Seller is a "United States person," as defined by Internal
Revenue Code Section 1445 and Section 7701. Seller has the legal capacity
and authority to enter into this Agreement and consummate the transactions
herein provided without the consent or joinder of any other party (except
as otherwise set forth in this Agreement). The execution of this Agreement
does not, and the performance by Seller of the transactions contemplated by
this Agreement will not, violate or constitute a breach of Seller's
partnership agreement, or any contract, permit, license, order or decree to
which Seller is a party or by which Seller or its assets are bound.
(f) BOND DOCUMENTS. The outstanding principal balance under the
Bond Documents as of the date hereof is approximately $4,053,850. All
payments required to be made under the Bond Documents have been paid by
Seller through February 28, 1996. Seller is not in monetary default or
material non-monetary default under the Bond Documents.
(g) ENVIRONMENTAL MATTERS. Seller has received no written notice,
and has no knowledge of, the existence, deposit, storage, removal, burial
or discharge of any material known to Seller to be a "Hazardous Material"
at, upon, under, within or adjacent to the Property, in an amount which
would, as of the date hereof, give rise to an "Environmental Compliance
Cost". The term "HAZARDOUS MATERIAL" means and includes any waste,
material or other substance defined as hazardous in 42 U.S.C. Sec. 9601(14)
or any related or applicable federal, state or local statute, law,
regulation or ordinance, pollutants or contaminants (as defined in
42 U.S.C. Sec. 9601(33), petroleum (including crude oil or any fraction
thereof), any form of natural or synthetic gas, sludge (as defined in 42
U.S.C. Sec. 6903(26A), radioactive substances, hazardous waste (as defined
in 42 U.S.C. Sec. 6903(27)) and any other hazardous wastes, hazardous
substances, contaminants or pollutants as defined or described in any of
the Environmental Laws. As used in this Agreement, "ENVIRONMENTAL LAWS"
means all federal, state and local environmental laws, and any rule or
regulation promulgated thereunder and any order, standard, interim
regulation, moratorium, policy or guideline of or pertaining to any
federal, state or local government, department or agency ("ENVIRONMENTAL
AGENCY"), including but not limited to the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended ("CERCLA"),
the Superfund Amendments and Reauthorization Act of 1986 ("SARA"), the
Clean Water Act, the Clean Air Act, the Toxic Substances Control Act, the
Occupational Safety and Health Act, the Federal Insecticide, Fungicide and
Rodenticide Act, the Marine Protection, Research, and Sanctuaries Act, the
National Environmental Policy Act, the Noise Control Act, the Safe Drinking
Water Act, the Resource Conservation and Recovery Act ("RCRA"), as amended,
the Hazardous Material Transportation Act, the Refuse Act, the Uranium Mill
Tailings Radiation Control Act and the Atomic Energy Act and regulations of
the Nuclear Regulatory Agency, and all state and local counterparts or
related statutes, laws, regulations, and order and treaties of the United
States; provided, however, that the term "Hazardous Material" shall not
include motor oil and gasoline contained in or discharged from vehicles not
used primarily for the transport of motor oil or gasoline. The term
"ENVIRONMENTAL COMPLIANCE COST" means any reasonable out-of-pocket cost,
fee or expense incurred directly to satisfy any requirement imposed by an
Environmental Agency to bring the Property into compliance with applicable
Environmental Laws directly relating to the existence on the Property of
any Hazardous Material.
(h) TITLE MATTERS. Seller has not previously conveyed its interest
in the Property and the Property is free from encumbrances except as
specifically set forth in this Agreement (i.e. the Bond Documents) and
further except for any and all matters of record. No person or entity has
any right or option to acquire the Property, other than Buyer pursuant to
this Agreement. Neither Seller nor any other party is in monetary default
or material non-monetary default under any restrictive covenants, or other
matters of record affecting the Property.
(i) SPECIAL ASSESSMENTS. Except as set forth in the Property tax
bills to be delivered to Buyer during the Due Diligence Period, there are
no special assessments against the Property and Seller has received no
written notice from any applicable taxing authority notifying Seller of its
intention to impose any additional special assessments.
(j) NO EMPLOYEES. Seller does not have any employees at the
Property (all such personnel being employed by Heitman).
(k) PERSONAL PROPERTY. Seller is the owner of the Personal
Property, free and clear of any liens or encumbrances except for matters of
record.
B. REPRESENTATIONS AND WARRANTIES OF BUYER. Buyer represents and
warrants to Seller as follows: This Agreement and all agreements,
instruments and documents herein provided to be executed or to be caused to
be executed by Buyer are and on the Closing Date will be duly authorized,
executed and delivered by and are binding upon Buyer; Buyer is a limited
partnership, duly organized and validly existing and in good standing under
the laws of the State of Delaware, and is duly authorized and qualified to
do all things required of it under this Agreement; Buyer has the legal
capacity and authority to enter into this Agreement and consummate the
transactions herein provided without the consent or joinder of any other
party (except as otherwise set forth in this Agreement). The execution of
this Agreement does not, and the performance by Buyer of the transactions
contemplated by this Agreement will not, violate or constitute a breach of
Buyer's partnership agreement, or any contract, permit, license, order or
decree to which Buyer is a party or by which Buyer or its assets are bound.
C. SURVIVAL. Any cause of action of a party for a breach of the
foregoing representations and warranties shall survive until the date which
is one (1) year after the Closing Date, at which time such representations
and warranties (and any cause of action resulting from a breach thereof not
then in litigation) shall terminate. Notwithstanding the foregoing, if
James O'Kane, the individuals who have been primarily responsible for
Buyer's due diligence reviews, shall have present actual knowledge as of
the Closing Date that any of the representations or warranties of Seller
contained herein are false or inaccurate or that Seller is in breach or
default of any of its obligations under this Agreement, and Buyer
nonetheless closes the transactions hereunder and acquires the Property,
then Seller shall have no liability or obligation respecting such false or
inaccurate representations or warranties or other breach or default (and
any cause of action resulting therefrom shall terminate upon such closing
hereunder).
D. INTERIM COVENANTS OF SELLER. Until the Closing Date or the
sooner termination of this Agreement:
(1) Seller shall maintain and operate the Property in the same
manner as prior hereto pursuant to its normal course of business (such
maintenance and operating obligations not including extraordinary capital
expenditures or expenditures not incurred in such normal course of
business), subject to reasonable wear and tear and further subject to
destruction by casualty or other events beyond the control of Seller.
Notwithstanding the foregoing, Seller shall continue to place vacated
apartment units in a "rent-ready" condition pursuant to Seller's ordinary
course of business, consistent with prior practices.
(2) Seller shall not enter into any additional service contracts or
other similar agreements without the prior written consent of Buyer, except
those deemed reasonably necessary by Seller which are cancelable without
payment of any fee on 30 days' notice (and Seller shall promptly provide
Buyer with copies of all such additional service contracts).
(3) Seller shall continue to offer the Property for lease in the
same manner as prior hereto pursuant to its normal course of business and
shall keep Buyer reasonably informed as to the status of leasing prior to
the Closing Date. After the expiration of the Due Diligence Period (unless
Buyer shall have theretofore delivered a Termination Notice hereunder),
Seller shall not enter into any new leases or modifications of existing
leases thereafter without the consent of Buyer (which consent will not be
unreasonably withheld or materially delayed); provided, however, Seller may
continue to enter into leases which are on Seller's standard lease form
(without material modification), are for terms of not more than one year,
and provide for rents of not less than Seller's pro forma rents for the
Property.
(4) Seller shall not sell the Property to any person other than
Buyer and shall not enter into any modifications or amendments to the Bond
Documents.
(5) Seller will not grant or consent to any new encumbrance or
other documents of record (such as easements or the like) covering the
Property which will survive the Closing without the prior written consent
of Buyer.
(6) Seller will keep such insurance coverage as currently
maintained by Seller with respect to the Property (or substantially similar
coverage) current and in full force and effect.
(7) Seller shall not remove any Personal Property, except for items
which are replaced with items of equally suitable value free and clear of
lien or encumbrance.
8. INDEMNIFICATION.
A. BY BUYER. Buyer shall hold harmless, indemnify and defend
Seller from and against: (1) any and all third party claims for Buyer's
torts or breaches of contract related to the Property and occurring on or
after the Closing Date, (2) any and all loss, damage or third party claims
in any way arising from Buyer's inspections or examinations of the Property
prior to the Closing Date, and (3) all costs and expenses, including
reasonable attorney's fees, incurred by Seller as a result of the
foregoing.
B. BY SELLER. Seller shall hold harmless, indemnify and defend
Buyer from and against: (1) any and all third party claims for Seller's
torts or breaches of contract related to the Property and occurring prior
to the Closing Date; and (2) all costs and expenses, including reasonable
attorney's fees, incurred by the Buyer as a result of such claims. The
foregoing indemnity shall not cover any matters relating to title or
marketability of the Property (Buyer relying on the coverage provided by
the Owner's Policy as to such matters).
C. GENERALLY. Each indemnification under this Agreement shall be
subject to the following provisions: The indemnitee shall notify
indemnitor of any such claim against indemnitee within 30 days after it has
notice of such claim, but failure to notify indemnitor shall in no case
prejudice the rights of indemnitee under this Agreement unless indemnitor
shall be prejudiced by such failure and then only to the extent of such
prejudice. Should indemnitor fail to discharge or undertake to defend
indemnitee against such liability within 10 days after the indemnitee gives
the indemnitor written notice of the same, then indemnitee may settle such
liability, and indemnitor's liability to indemnitee shall be conclusively
established by such settlement, the amount of such liability to include
both the settlement consideration and the reasonable costs and expenses,
including reasonable attorneys' fees, incurred by indemnitee in effecting
such settlement.
9. DEFAULT, DISPOSITION OF DEPOSITS. IF THE TRANSACTION HEREIN
PROVIDED SHALL NOT BE CLOSED BY REASON OF SELLER'S DEFAULT UNDER THIS
AGREEMENT OR THE FAILURE OF SATISFACTION OF THE CONDITIONS DESCRIBED IN
PARAGRAPH 4 HEREOF OR THE TERMINATION OF THIS AGREEMENT IN ACCORDANCE WITH
PARAGRAPH 6 HEREOF, THEN THE ESCROW DEPOSIT SHALL BE RETURNED TO BUYER, AND
NEITHER PARTY SHALL HAVE ANY FURTHER OBLIGATION OR LIABILITY TO THE OTHER;
PROVIDED, HOWEVER, IF THE TRANSACTIONS HEREUNDER SHALL FAIL TO CLOSE SOLELY
BY REASON OF SELLER'S DEFAULT, AND BUYER SHALL HAVE FULLY PERFORMED ITS
OBLIGATIONS HEREUNDER AND SHALL BE READY, WILLING AND ABLE TO CLOSE, THEN
BUYER SHALL BE ENTITLED TO SPECIFICALLY ENFORCE THIS AGREEMENT (BUT NO
OTHER ACTION, FOR DAMAGES OR OTHERWISE, SHALL BE PERMITTED). IN THE EVENT
THE TRANSACTION HEREIN PROVIDED SHALL NOT CLOSE BY REASON OF BUYER'S
DEFAULT UNDER THIS AGREEMENT, THEN THE ESCROW DEPOSIT SHALL BE DELIVERED TO
SELLER AS FULL COMPENSATION AND LIQUIDATED DAMAGES UNDER AND IN CONNECTION
WITH THIS AGREEMENT. IN THE EVENT THE TRANSACTION HEREIN PROVIDED SHALL
CLOSE, THE ESCROW DEPOSIT SHALL BE RETURNED TO BUYER. IN CONNECTION WITH
THE FOREGOING, THE PARTIES RECOGNIZE THAT SELLER WILL INCUR EXPENSE IN
CONNECTION WITH THE TRANSACTION CONTEMPLATED BY THIS AGREEMENT AND THAT THE
PROPERTY WILL BE REMOVED FROM THE MARKET; FURTHER, THAT IT IS EXTREMELY
DIFFICULT AND IMPRACTICABLE TO ASCERTAIN THE EXTENT OF DETRIMENT TO SELLER
CAUSED BY THE BREACH BY BUYER UNDER THIS AGREEMENT AND THE FAILURE OF THE
CONSUMMATION OF THE TRANSACTION CONTEMPLATED BY THIS AGREEMENT OR THE
AMOUNT OF COMPENSATION SELLER SHOULD RECEIVE AS A RESULT OF BUYER'S BREACH
OR DEFAULT. IN THE EVENT THE SALE OF THE PROPERTY SHALL NOT BE CONSUMMATED
ON ACCOUNT OF BUYER'S DEFAULT, THEN THE RETENTION OF THE ESCROW DEPOSIT
SHALL BE SELLER'S SOLE AND EXCLUSIVE REMEDY UNDER THIS AGREEMENT BY REASON
OF SUCH DEFAULT, SUBJECT TO THE PROVISIONS OF PARAGRAPH 10I HEREOF.
-------------------- --------------------
SELLER'S INITIALS BUYER'S INITIALS
10. MISCELLANEOUS.
A. BROKERS.
(1) Except as provided in subparagraph (2) below, Seller represents
and warrants to Buyer, and Buyer represents and warrants to Seller, that no
broker or finder has been engaged by it, respectively, in connection with
any of the transactions contemplated by this Agreement or to its knowledge
is in any way connected with any of such transactions. In the event of a
claim for broker's or finder's fee or commissions in connection herewith,
then Seller shall indemnify and defend Buyer from the same if it shall be
based upon any statement or agreement alleged to have been made by Seller,
and, except for any claims by Broker which are Seller's responsibility
hereunder, Buyer shall indemnify and defend Seller from the same if it
shall be based upon any statement or agreement alleged to have been made by
Buyer. The indemnification obligations under this paragraph 10 A(1) shall
survive the closing of the transactions hereunder or the earlier
termination of this Agreement.
(2) If and only if the sale contemplated herein closes, Seller
agrees to pay a brokerage commission to Indian Hill Partners and Triton
Financial Group (collectively, the "BROKERS") pursuant to separate
agreements. The foregoing payment shall be the sole commissions, fees or
payments payable to the Brokers in connection with the transactions
hereunder.
B. LIMITATION OF LIABILITY.
(1) Notwithstanding anything to the contrary contained herein, if
the closing of the transactions hereunder shall have occurred (and Buyer
shall not have waived, relinquished or released any applicable rights in
further limitation), the aggregate liability of Seller arising pursuant to
or in connection with the representations, warranties, indemnifications,
covenants or other obligations (whether express or implied) of Seller under
this Agreement (or any document executed or delivered in connection
herewith) shall not exceed $800,000.
(2) Neither any constituent partner in Seller (other than its
general partner, Carlyle Real Estate Limited Partnership - XII ["Carlyle-
XII"]) nor in Carlyle-XII, nor any agent of Seller, nor any advisor,
trustee, director, officer, employee, beneficiary, shareholder,
participant, representative or agent of any corporation or trust that is or
becomes a constituent partner in Seller (including, but not limited to,
Carlyle-XII, JMB Realty Corporation, and the individual(s) specified in
paragraph 7A(2) above) shall have any personal liability, directly or
indirectly, under or in connection with this Agreement or any agreement
made or entered into under or pursuant to the provisions of this Agreement,
or any amendment or amendments to any of the foregoing made at any time or
times, heretofore or hereafter, and Buyer and its successors and assigns
and, without limitation, all other persons and entities, shall look solely
to Seller's and/or Carlyle-XII's assets for the payment of any claim or for
any performance, and Buyer, on behalf of itself and its successors and
assigns, hereby waives any and all such personal liability.
Notwithstanding anything to the contrary contained in this Agreement,
neither the negative capital account of any constituent partner in Seller
(or in any other constituent partner of Seller), nor any obligation of any
constituent partner in Seller (or in any other constituent partner of
Seller) to restore a negative capital account or to contribute capital to
Seller (or to any other constituent partner of Seller), shall at any time
be deemed to be the property or an asset of Seller or any such other
constituent partner (and neither Buyer nor any of its successors or assigns
shall have any right to collect, enforce or proceed against or with respect
to any such negative capital account of partner's obligation to restore or
contribute).
C. ENTIRE AGREEMENT. This Agreement contains the entire agreement
between the parties respecting the matters herein set forth and supersedes
all prior agreements between the parties hereto respecting such matters.
This Agreement may not be modified or amended except by written agreement
signed by both parties.
D. TIME OF THE ESSENCE. Time is of the essence of this Agreement.
E. INTERPRETATION. Paragraph headings shall not be used in
construing this Agreement. Each party acknowledges that such party and its
counsel, after negotiation and consultation, have reviewed and revised this
Agreement. As such, the terms of this Agreement shall be fairly construed
and the usual rule of construction, to the effect that any ambiguities
herein should be resolved against the drafting party, shall not be employed
in the interpretation of this Agreement or any amendments, modifications or
exhibits hereto or thereto.
F. GOVERNING LAW. This Agreement shall be construed and enforced
in accordance with the laws of the State of Illinois.
G. SUCCESSORS AND ASSIGNS. Buyer may not assign or transfer its
rights or obligations under this Agreement without the prior written
consent of Seller (in which event such transferee shall assume in writing
all of the transferor's obligations hereunder, but such transferor shall
not be released from its obligations hereunder); provided, however, Buyer
may, without Seller's further consent, assign its interest in this
Agreement to an entity which controls, is controlled by or is under common
control with Buyer ("Permitted Assignee"). No consent given by Seller to
any transfer or assignment of Buyer's rights or obligations hereunder shall
be construed as a consent to any other transfer or assignment of Buyer's
rights or obligations hereunder. No transfer or assignment in violation of
the provisions hereof shall be valid or enforceable. Subject to the
foregoing, this Agreement and the terms and provisions hereof shall inure
to the benefit of and be binding upon the successors and assigns of the
parties.
H. NOTICES. Any notice which a party is required or may desire to
give the other shall be in writing and shall be sent by personal delivery
or by mail (either [i] by United States registered or certified mail,
return receipt requested, postage prepaid, [ii] by Federal Express or
similar generally recognized overnight carrier regularly providing proof of
delivery, or [iii] by facsimile (provided a copy thereof is sent on the
same day for next day delivery in accordance with clause [ii] above)),
addressed as follows (subject to the right of a party to designate a
different address for itself by notice similarly given):
TO BUYER:
Prime Residential, L.P.
77 West Wacker Drive
Suite 4040
Chicago, Illinois 60601
Attention: Mr. Richard F. Cavenaugh
Facsimile No.: (312) 917-9910
WITH COPY TO:
Schain, Firsel and Burney, Ltd.
222 North LaSalle Street
Suite 1910
Chicago, Illinois 60601
Attention: Michael D. Firsel, Esq.
Facsimile No.: (312) 332-4514
TO SELLER:
Stonybrook Partners Limited Partnership
c/o JMB Realty Corporation
900 North Michigan Avenue
19th Floor
Chicago, Illinois 60611
Attention: Mr. Glenn E. Emig
Facsimile No.: (312) 915-2310
WITH COPY TO:
Pircher, Nichols & Meeks
1999 Avenue of the Stars
Suite 2600
Los Angeles, California 90067
Attention: Real Estate Notices (GML)
Facsimile No.: (310) 201-8922
Any notice so given by mail shall be deemed to have been given as of the
date of delivery (whether accepted or refused) established by U.S. Post
Office return receipt or the overnight carrier's proof of delivery, or upon
transmission if notice is by facsimile (so long as followed by overnight
delivery as aforesaid), as the case may be. Any such notice not so given
shall be deemed given upon receipt of the same by the party to whom the
same is to be given.
I. LEGAL COSTS. The parties hereto agree that they shall pay
directly any and all legal costs which they have incurred on their own
behalf in the preparation of this Agreement, all deeds and other agreements
pertaining to this transaction and that such legal costs shall not be part
of the closing costs. In addition, if either Buyer or Seller brings any
suit or other proceeding with respect to the subject matter or the
enforcement of this Agreement, the prevailing party (as determined by the
court, agency or other authority before which such suit or proceeding is
commenced), in addition to such other relief as may be awarded, shall be
entitled to recover reasonable attorneys' fees, expenses and costs of
investigation actually incurred. The foregoing includes, but is not
limited to, attorneys' fees, expenses and costs of investigation
(including, without limitation, those incurred in appellate proceedings),
costs incurred in establishing the right to indemnification, or in any
action or participation in, or in connection with, any case or proceeding
under Chapter 7, 11 or 13 of the Bankruptcy Code (11 United States Code
Sections 101 ET SEQ.), or any successor statutes.
J. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
shall constitute one and the same document.
K. REPORTING PERSON. Seller and Buyer hereby designate Escrow
Holder as the Real Estate Reporting Person for purposes of Section 6045 of
the Internal Revenue Code; and Escrow Holder, by its execution below,
hereby accepts such appointment.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the day and year first above written.
STONYBROOK PARTNERS LIMITED PARTNERSHIP,
an Illinois limited partnership
By: CARLYLE REAL ESTATE LIMITED
PARTNERSHIP-XII,
an Illinois limited partnership,
General Partner
By: JMB REALTY CORPORATION,
a Delaware corporation,
General Partner
By: ____________________
Name: ____________________
Title: ____________________
"Seller"
PRIME RESIDENTIAL, L.P.,
a Delaware limited partnership
By: PRIME RESIDENTIAL, INC.,
a Maryland corporation,
General Partner
By: ___________________________
Name: ____________________
Title: ____________________
"Buyer"
ESCROW HOLDER'S ACKNOWLEDGEMENT
The undersigned hereby executes this Agreement to evidence its
agreement to act as Escrow Holder in accordance with the terms of this
Agreement.
Date: ________________NEAR NORTH NATIONAL TITLE CORPORATION,
By: ___________________________________
Name: _____________________________
Title: ____________________________
"Escrow Holder"
EXHIBIT LIST
"A" - Property Description
"B" - Personal Property List
"C" - Description of Bond Documents
"D" - Survey Requirements
"E" - Deed
"F" - Assignment and Assumption Agreement
"G" - Intentionally Deleted
"H" - Rent Roll
"I" - Service Agreements
EXHIBIT "A"
EXHIBIT "B"
EXHIBIT "C"
EXHIBIT "D"
EXHIBIT "E"
EXHIBIT "F"
INTENTIONALLY DELETED
EXHIBIT "G"
EXHIBIT "H"
EXHIBIT "I"
ASSIGNMENT, ASSUMPTION AND MODIFICATION AGREEMENT
(Stonybrook Apartments; Tucson, Arizona)
THIS AGREEMENT is made as of the _______ day of May, 1996, by and
among PRIME RESIDENTIAL, L.P., a Delaware limited partnership (ASSIGNOR"),
PRIME MFP II LIMITED PARTNERSHIP, a Delaware limited partnership ("BUYER"),
and STONYBROOK PARTNERS LIMITED PARTNERSHIP, a Delaware limited partnership
("SELLER").
R E C I T A L S:
A. Seller and Assignee have entered into that certain Purchase
Agreement and Joint Escrow Instructions, providing for, among other things,
the sale of that certain apartment complex known as the "Stonybrook
Apartments", located in the City of Tucson, County of Pima and State of
Arizona (which agreement, together with all amendments and modifications
thereto, are herein collectively called the "PURCHASE AGREEMENT").
B. Assignor desires to assign, and Buyer desires to assume, the
obligations of Assignee under and in connection with the Purchase
Agreement.
C. The parties wish to modify the Purchase Agreement in accordance
with the provisions set forth herein.
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereby agree as
follows:
1. Assignor hereby assigns, and Buyer hereby assumes, all rights
and obligations of Assignee, as buyer, under the Purchase Agreement as if
Buyer were the original named "Buyer" thereunder.
2. Seller was inadvertently incorrectly referred to as an Illinois
limited partnership, whose general partner is Carlyle Real Estate Limited
Partnership-XII. Seller is, in fact, a Delaware limited partnership, whose
general partner is JMB Investors-III, Inc. The Purchase Agreement is
hereby deemed to be modified MUTATIS MUTANDIS to effectuate the foregoing
as if such modifications were incorporated into the Purchase Agreement AB
INITIO. Without limitation on the foregoing, the parties acknowledge
Carlyle Real Estate Limited Partnership-XII is a limited partner in Seller
and shall have no general partner liability of any kind or nature and that
any right under paragraph 10B(2) of Buyer or any other party to proceed
against Carlyle Real Estate Limited Partnership-XII shall only be as to
proceeds which such entity, as a limited partner of Seller, actually
receives from the sale under the Purchase Agreement (and is further subject
to all limitations on liability contained in the Purchase Agreement or
otherwise provided by law).
Except as specifically provided herein, the Purchase Agreement is
unmodified and in full force and effect.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date set fort above.
STONYBROOK PARTNERS LIMITED PARTNERSHIP,
a Delaware limited partnership
By: JMB INVESTORS-III, INC.
an Illinois corporation,
General Partner
By: ______________________________
Name: ______________________________
Title: ______________________________
"Seller"
PRIME RESIDENTIAL, L.P.,
a Delaware limited partnership
By: PRIME RESIDENTIAL, INC.,
a Maryland corporation,
General Partner
By: ______________________________
Name: ______________________________
Title: ______________________________
"Assignor"
PRIME MFP II LIMITED PARTNERSHIP,
a Delaware limited partnership
By: PRIME MFP II RESIDENTIAL, INC.,
a Delaware corporation,
General Partner
By: ------------------------------
Name: ------------------------------
Title: ------------------------------
"Buyer"
FIRST AMENDMENT TO PURCHASE AGREEMENT
AND JOINT ESCROW INSTRUCTIONS
---------------------------------------
THIS FIRST AMENDMENT TO PURCHASE AGREEMENT AND JOINT ESCROW
INSTRUCTIONS ("First Amendment") is made and entered into as of April 8,
1996, by and between STONYBROOK PARTNERS LIMITED PARTNERSHIP, an Illinois
limited partnership ("Seller") and PRIME RESIDENTIAL, L.P., a Delaware
limited partnership ("Buyer").
W I T N E S S E T H:
WHEREAS, Buyer and Seller entered into a Purchase Agreement and Joint
Escrow Instructions ("Purchase Agreement") for the purchase and sale of a
four hundred eleven (411) unit apartment complex commonly known as
Stonybrook Apartments located at 4225 North First Avenue, Tucson, Arizona
("Property"); and
WHEREAS, Buyer and Seller desire to modify and amend the terms and
conditions of the Purchase Agreement as provided for in this First
Amendment.
NOW, THEREFORE, in consideration of Ten and 00/100 Dollars ($10.00)
and other good and valuable considerations, the receipt, adequacy and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. Wherever the terms and conditions of this First Amendment
conflict with the terms and conditions of the Purchase Agreement, the terms
and conditions of this First Amendment shall control and govern. All other
terms and conditions of the Purchase Agreement are hereby restated herein
as if fully set forth in their entirety.
2. Paragraph 2 of the Purchase Agreement is hereby deleted in its
entirety and the following Paragraph 2 is inserted in its stead:
2. PURCHASE PRICE. The Purchase Price ("Purchase Price")
for the Property shall be the sum of Nine Million Two Hundred Seventy-Five
Thousand and 00/100 Dollars ($9,275,000.00).
3. Paragraph 3(C) of the Purchase Agreement shall be
modified to provide that the Closing Payment shall be based upon the
Purchase Price as modified by this First Amendment.
4. Paragraph 4(B) of the Purchase Agreement shall be
modified to provide that the Due Diligence Period shall expire on April 29,
1996.
5. Paragraph 4(C) of the Purchase Agreement shall be
modified to provide that the Bond Approval Period shall expire on April 29,
1996.
6. Paragraph 5 of the Purchase Agreement shall be modified
by deleting the date "May 15, 1996" therefrom and inserting in its stead
the date "April 30, 1996".
IN WITNESS WHEREOF, the parties hereto have executed this First
Amendment to Purchase Agreement and Joint Escrow Instructions as of the day
and date first above written.
SELLER:
STONYBROOK PARTNERS LIMITED
By: CARLYLE REAL ESTATE LIMITED
PARTNERSHIP - XII, an Illinois limited
partnership, Its General Partner
By: JMB REALTY CORPORATION, a
Delaware corporation
Its: General Partner
By: ____________________
Name: ____________________
Title: ____________________
BUYER
PRIME RESIDENTIAL, L.P., a Delaware
limited partnership
By: PRIME RESIDENTIAL, INC., a
Maryland corporation
Its: General Partner
By: ____________________
Name: ____________________
Title: ____________________
ACKNOWLEDGED BY:
NEAR NORTH NATIONAL TITLE
CORPORATION
By: ____________________
Name: ____________________
Title: ____________________
SECOND AMENDMENT TO PURCHASE AGREEMENT
AND JOINT ESCROW INSTRUCTIONS
----------------------------------------
THIS SECOND AMENDMENT TO PURCHASE AGREEMENT AND JOINT ESCROW
INSTRUCTIONS ("Second Amendment") is made and entered into as of April 26,
1996, by and between STONYBROOK PARTNERS LIMITED PARTNERSHIP, an Illinois
limited partnership ("Seller") and PRIME RESIDENTIAL, L.P., a Delaware
limited partnership ("Buyer").
W I T N E S S E T H:
WHEREAS, Buyer and Seller entered into a Purchase Agreement and Joint
Escrow Instructions ("Purchase Agreement") for the purchase and sale of a
four hundred eleven (411) unit apartment complex commonly known as
Stonybrook Apartments located at 4225 North First Avenue, Tucson, Arizona
("Property"), which was modified by a First Amendment to Purchase Agreement
and Joint Escrow Instructions dated April 8, 1996 ("First Amendment"); and
WHEREAS, Buyer and Seller desire to modify and amend the terms and
conditions of the Purchase Agreement and the First Amendment as provided
for in this Second Amendment.
NOW, THEREFORE, in consideration of Ten and 00/100 Dollars ($10.00)
and other good and valuable considerations, the receipt, adequacy and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. Wherever the terms and conditions of this Second Amendment
conflict with the terms and conditions of the Purchase Agreement of the
First Amendment, the terms and conditions of this Second Amendment shall
control and govern. All other terms and conditions of the Purchase
Agreement and the First Amendment are hereby restated herein as if fully
set forth in their entirety.
2. Paragraph 2 of the Purchase Agreement is hereby deleted in its
entirety and the following Paragraph 2 is inserted in its stead:
2. PURCHASE PRICE. The Purchase Price ("Purchase Price")
for the Property shall be the sum of Eight Million Eight Hundred Thousand
and 00/100 Dollars ($8,800,000.00).
3. Paragraph 3(C) of the Purchase Agreement shall be modified to
provide that the Closing Payment shall be based upon the Purchase Price as
modified by this Second Amendment.
4. Paragraph 4(B) of the Purchase Agreement shall be modified to
provide that the Due Diligence Period shall expire on May 3, 1996.
5. Paragraph 4(C) of the Purchase Agreement shall be modified to
provide that the Bond Approval Period shall expire on May 3, 1996.
6. Paragraph 5 of the Purchase Agreement shall be modified by
deleting the date "April 30, 1996" therefrom and inserting in its stead the
date "May 24, 1996".
IN WITNESS WHEREOF, the parties hereto have executed this Second
Amendment to Purchase Agreement and Joint Escrow Instructions as of the day
and date first above written.
SELLER:
STONYBROOK PARTNERS LIMITED
PARTNERSHIP, an Illinois limited partnership
By: CARLYLE REAL ESTATE LIMITED
PARTNERSHIP - XII, an Illinois limited
partnership, Its General Partner
By: JMB REALTY CORPORATION, a
Delaware corporation
Its: General Partner
By: ____________________
Name: ____________________
Title: ____________________
BUYER
PRIME RESIDENTIAL, L.P., a Delaware
limited partnership
By: PRIME RESIDENTIAL, INC., a
Maryland corporation
Its: General Partner
By: ____________________
Name: ____________________
Title: ____________________
ACKNOWLEDGED BY:
NEAR NORTH NATIONAL TITLE
CORPORATION
By: ____________________
Name: ____________________
Title: ____________________
THIRD AMENDMENT TO PURCHASE AGREEMENT
AND JOINT ESCROW INSTRUCTIONS
----------------------------------------
THIS THIRD AMENDMENT TO PURCHASE AGREEMENT AND JOINT ESCROW
INSTRUCTIONS ("Third Amendment") is made and entered into as of May 3,
1996, by and between STONYBROOK PARTNERS LIMITED PARTNERSHIP, an Illinois
limited partnership ("Seller"), and PRIME RESIDENTIAL, L.P., a Delaware
limited partnership ("Buyer").
W I T N E S S E T H:
WHEREAS, Buyer and Seller entered into a Purchase Agreement and Joint
Escrow Instructions ("Purchase Agreement") for the purchase and sale of a
four hundred eleven (411) unit apartment complex commonly known as
Stonybrook Apartments located at 4225 North First Avenue, Tucson, Arizona
("Property"), which was modified by a First Amendment to Purchase Agreement
and Joint Escrow Instructions dated April 8, 1996 ("First Amendment") and a
Second Amendment to Purchase Agreement and Joint Escrow Instructions dated
April 26, 1996 ("Second Amendment"); and
WHEREAS, Buyer and Seller desire to modify and amend the terms and
conditions of the Purchase Agreement and the First Amendment and the Second
Amendment as provided for in this Third Amendment.
NOW, THEREFORE, in consideration of Ten and 00/100 Dollars ($10.00)
and other good and valuable considerations, the receipt, adequacy and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. Wherever the terms and conditions of this Third Amendment
conflict with the terms and conditions of the Purchase Agreement, the First
Amendment or the Second Amendment, the terms and conditions of this Third
Amendment shall control and govern. All other terms and conditions of the
Purchase Agreement and the First Amendment and the Second Amendment are
hereby restated herein as if fully set forth in their entirety.
2. Paragraph 4.C of the Purchase Agreement shall be modified to
provide that the Bond Approval Period shall expire on May 24, 1996.
3. The sentence in Paragraph 4(C)(1) which reads as follows:
If Buyer shall determine that all consents (including the costs
attendant thereto) are acceptable to Buyer, Buyer shall promptly give
written notice thereof (such notice being herein called the "BOND APPROVAL
NOTICE").
shall be replaced in its entirety with the following:
If Buyer shall determine that all consents and approvals
require for the assumption of the bonds are acceptable to Buyer, and if
Buyer shall determine, in its sole and absolute discretion that Seller has
fully complied with the terms and conditions of the Bond Documents, Buyer
shall promptly give written notice thereof (such notice being herein called
the "BOND APPROVAL NOTICE").
IN WITNESS WHEREOF, the parties hereto have executed this Second
Amendment to Purchase Agreement and Joint Escrow Instructions as of the day
and date first above written.
SELLER:
STONYBROOK PARTNERS LIMITED
PARTNERSHIP, an Illinois limited partnership
By: CARLYLE REAL ESTATE LIMITED
PARTNERSHIP - XII, an Illinois limited
partnership, Its General Partner
By: JMB REALTY CORPORATION, a
Delaware corporation
Its: General Partner
By: ____________________
Name: ____________________
Title: ____________________
BUYER
PRIME RESIDENTIAL, L.P., a Delaware
limited partnership
By: PRIME RESIDENTIAL, INC., a
Maryland corporation
Its: General Partner
By: ____________________
Name: ____________________
Title: ____________________
CARLYLE - XII - EXHIBIT E
Loan No. 166136
Permian Mall
Odessa, Texas
---------------
AFTER RECORDING, PLEASE RETURN TO:
- ---------------------------------
Kenneth F. Plifka, Esquire
Stutzman & Bromberg,
A Professional Corporation
2323 Bryan Street
Suite 2200
Dallas, Texas 75201
SUBSTITUTE TRUSTEE'S DEED AND BILL OF SALE
------------------------------------------
THE STATE OF TEXAS )
) KNOW ALL MEN BY THESE PRESENTS:
COUNTRY OF ECTOR )
WHEREAS, pursuant to that certain deed of trust, mortgage and
security agreement dated May 5, 1980, executed by Permian Mall ("PERMIAN
MALL") to Warren D. Smith, Jr., trustee ("TRUSTEE") for the benefit of
Massachusetts Mutual Life Insurance Company ("LENDER"), recorded in Volume
604, Page 246, Deed of Trust
Records, Ector County, Texas, as amended or otherwise affected by that
certain (i) Second Disbursement Agreement ( the "DISBURSEMENT
AGREEMENT") dated February 27, 1981, executed by Lender and Permian Mall
and recorded under Document No. 3824, Deed Records, Ector County, Texas;
and (ii) Modification Agreement, Partial Release and Consent (the
"MODIFICATION AGREEMENT") dated April 2, 1985, executed by Lender and CP
Permian Partners ("CP PERMIAN") and recorded in Volume 766, Page 64, Deed
of Trust Records, Ector County, Texas (such deed of trust, mortgage and
security agreement, as so amended or other wise affected, is hereinafter
referred to as the "DEED OF TRUST" and Permian Mall and CP Permian are
sometimes collectively referred to as "BORROWER"), Borrower conveyed to
Trustee certain real property, together with all appurtenances thereto, and
improvements thereon (such real property, appurtenances and improvements
being collectively referred to as the "REAL PROPERTY") located in Ector
County, Texas, more particularly described on EXHIBIT A attached hereto and
made a part hereof for all purposes and granted Lender a security interest
in that certain personal property (the "PERSONAL PROPERTY") situated on or
related to the Real Property, more particularly described on EXHIBIT B
attached hereto and made a part hereof for all purposes (the Real Property,
the Personal Property and any and all of Borrower's rights, titles and
interests in any other property, real or personal, as described in, or
otherwise included as collateral under, the Deed of Trust or any instrument
related thereto are collectively referred to as the "PROPERTY") to secure
the payment of that certain promissory note dated May 5, 1980, executed by
Permian Mall and payable to Lender's order in the original principal amount
of $27,500,000, as amended or otherwise affected by the Disbursement
Agreement and the Modification Agreement (such promissory note, as so
amended or otherwise affected, is hereinafter referred to as the "NOTE");
WHEREAS, Lender is the current owner and holder of the Note and the
beneficiary under the Deed of Trust, and the undersigned was appointed as
substitute trustee in the place and stead of Trustee, said appointment
being in the manner authorized by the Deed of Trust;
WHEREAS, the indebtedness evidenced by the Note is now due and Lender
has requested the undersigned, the duly appointed substitute trustee under
the Deed of Trust, to enforce the trust and sell the Property pursuant to
and in accordance with the provisions of the Deed of Trust and the laws of
the State of Texas;
WHEREAS, the undersigned, at the request of Lender, did cause (i) to
be posted, for at least twenty-one (21) consecutive days prior to the day
of sale at the courthouse door, Ector County, Texas, and (ii) to be filed,
for at least twenty-one(21) consecutive days prior to the day of sale, with
the County Clerk of Ector County, Texas, written notice that the Property
would be sold pursuant to the Deed of Trust, in public vendue to the
highest bidder for cash at the area designated by the Commissioners Court
where sales are to take place in Ector County, Texas beginning no later
than three (3) hours following 10:00 o'clock a.m., on April 2, 1996, the
first Tuesday of April, 1996;
WHEREAS, the undersigned, at the request of Lender, did cause written
notice of the proposed sale to be served by certified mail, return receipt
requested, on Borrower and every other party obligated to pay the
indebtedness evidenced by the Note according to the records of Lender, at
least twenty-one (21) days preceding the date of sale, such service having
been completed by deposit of the notice enclosed in a prepaid wrapper,
properly addressed to each such party at the most recent address of such
party as shown by the records of Lender in a post office or official
depository under the care and custody of the United States Postal Service;
WHEREAS, the undersigned on April 2, 1996, at approximately 10:00
o'clock a.m., pursuant to the powers under the Deed of Trust vested in the
undersigned did cause the Property to be sold at public vendue in the
manner required by and as provided in and under the Deed of Trust and by
law; and
WHEREAS, the undersigned offered the Property for sale for an all-
cash price, and in response to that offer, the undersigned sold the
Property to MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY ("GRANTEE") the
best and highest bidder at such sale for the sum of TEN AND NO/100 DOLLARS
($10.00 and other good and valuable consideration (the BID").
NOW, THEREFORE, in consideration of the premises set forth above and
the payment of the Bid, the receipt of which is hereby acknowledged, the
undersigned, by virtue of the authority vested in the undersigned under the
Deed of Trust, has GRANTED, BARGAINED, SOLD, CONVEYED, CONFIRMED and SET
OVER and by this Substitute Trustee's Deed and Bill of Sale does hereby
GRANT, BARGAIN, SELL, CONVEY, CONFIRM AND SET OVER unto Grantee, and its
legal representative, successors and assigns, the Property, it being
expressly understood that the undersigned has made no independent
investigation or inquiry concerning the same and does not hereby make any
covenant, representation or warranty concerning the same, except on behalf
of Borrower as hereinafter provided.
TO HAVE AND TO HOLD the Property, together with all and singular the
rights and appurtenances thereto in anywise belonging, unto Grantee, its
legal representatives, successors and assigns forever; and the undersigned
does hereby bind Borrower and its successors to WARRANT and FOREVER DEFEND,
all and singular, the property unto Grantee, and its legal
representatives, successors and assigns, against every person whomsoever
lawfully claiming or to claim the same or any part thereof.
This Substitute Trustee's Deed and Bill of Sale covers both the Real
Property and the Personal Property, and the Personal Property has been sold
to the maximum degree permitted by law, including, without limitation,
Section 9.501(d) of the Texas Uniform Commercial Code.
The mailing address of the Grantee hereunder is:
-----------------------------------------------
Massachusetts Mutual Life
Insurance Company
Springfield, Massachusetts 01111-0001
IN WITNESS WHEREOF, this Substitute Trustee's Deed and Bill of Sale
has been executed by the undersigned in her capacity as substitute trustee,
and in accordance with and under and pursuant to the provisions, powers an
authorities set forth in the Deed of Trust, on this 2nd day of April, 1996.
Christine M. Savage
----------------------------
Christine M. Savage,
Substitute Trustee
STATE OF TEXAS )
)
COUNTY OF ECTOR )
This instrument was acknowledged before me on April 2, 1996 by
Christine M. Savage, Substitute Trustee.
Cynthia L. Jeffery
---------------------------
Notary Public in and for
the State of Texas
Cynthia L. Jeffery
Notary Public, State of Texas
My Commission Expires 01/21/96
My Commission Expires: Cynthia L. Jeffery
- --------------------- ---------------------------
Printed Name of Notary
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
REGISTRANT'S FORM 10-Q FOR THE SIX MONTHS ENDED JUNE 30, 1996 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS
INCLUDED IN SUCH REPORT.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
<CASH> 9,565,576
<SECURITIES> 0
<RECEIVABLES> 2,027,453
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 11,593,029
<PP&E> 91,000,070
<DEPRECIATION> 31,022,762
<TOTAL-ASSETS> 73,362,238
<CURRENT-LIABILITIES> 3,493,169
<BONDS> 54,876,709
<COMMON> 0
0
0
<OTHER-SE> 14,346,993
<TOTAL-LIABILITY-AND-EQUITY> 73,362,238
<SALES> 9,478,143
<TOTAL-REVENUES> 9,785,442
<CGS> 0
<TOTAL-COSTS> 5,331,852
<OTHER-EXPENSES> 457,219
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 3,645,289
<INCOME-PRETAX> 351,082
<INCOME-TAX> 0
<INCOME-CONTINUING> 253,403
<DISCONTINUED> 7,435,143
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 7,688,546
<EPS-PRIMARY> 47.52
<EPS-DILUTED> 47.52
</TABLE>
