<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities and Exchange Act of 1934
Date of Report (Date of earliest event reported) October 30, 1998
----------------
Paine Webber Growth Properties LP
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 0-10995 04-2772109
- --------------------------------------------------------------------------------
(State or other jurisdiction) (Commission (IRS Employer
of incorporation File Number) Identification No.)
265 Franklin Street, Boston, Massachusetts 02110
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (617) 439-8118
--------------
(Former name or address, if changed since last report)
<PAGE>
FORM 8-K
CURRENT REPORT
PAINE WEBBER GROWTH PROPERTIES LP
ITEM 2 - Disposition of Assets
The Tantra Lake Apartments, Boulder, Colorado and the
Grouse Run I and II Apartments, Stockton, California
Disposition Dates - October 30, 1998 and November 2, 1998
On October 30, 1998 and November 2, 1998, respectively, Rocky Mountain
Partners and Grouse Run Associates, two joint ventures in which the Partnership
has an interest, sold the properties known as the Tantra Lake Apartments and the
Grouse Run I and II Apartments to affiliates of the co-venture partner. In both
cases, the Partnership had executed purchase and sale agreements with unrelated
third parties which were then presented to the co-venture partner under the
right of first refusal provisions of the joint venture agreements. Under the
terms of the joint venture agreements, the partner then had 60 days to decide
whether to agree to buy the property at the price and on the terms offered by
the prospective purchaser, or to waive its first refusal right and agree to a
sale to the prospective buyer. In both cases, the co-venture partner opted to
purchase the properties. Tantra Lake, located in Boulder, Colorado, was sold for
$23.2 million, and Grouse Run, located in Stockton, California, was sold for
$5.8 million. The Partnership received net proceeds of approximately $12,361,000
from the sale of Tantra Lake after deducting closing costs and proration
adjustments of approximately $724,000, the repayment of the existing first
mortgage note of $8,850,000 and a prepayment penalty of approximately $88,000, a
reserve for final property expenses and joint venture costs of $323,000, and a
payment of approximately $854,000 to the Partnership's co-venture partner for
its share of the sale proceeds in accordance with the joint venture agreement.
The Partnership received net proceeds of approximately $2,494,000 from the sale
of Grouse Run after deducting closing costs and proration adjustments of
approximately $266,000 and the repayment of the existing first mortgage note of
approximately $3,040,000. The Partnership was entitled to 100% of the net
proceeds in accordance with the terms of the Grouse Run joint venture agreement.
The Partnership will distribute the net proceeds from the sale of the Tantra
Lake property in the form of a special distribution of $437 per original $1,000
investment to be paid on November 13, 1998 with the regular quarterly
distribution for the quarter ended September 30, 1998. Of this special
distribution amount, $423.40 per original $1,000 investment represents the
Tantra Lake sale proceeds and $13.60 per original $1,000 investment represents
Partnership reserves which exceed expected future requirements. The Partnership
will distribute the net proceeds from the sale of Grouse Run after receiving
final documentation from the Department of Housing and Urban Development (HUD)
for the sale and related repayment of the HUD first mortgage loan which had been
secured by Grouse Run.
In addition to the sales of Tantra Lake and Grouse Run, the Partnership's
final operating investment property, the Chisholm Place Apartments located in
Plano, Texas, is under contract for sale to the co-venture partner as a result
of the exercise of a right of first refusal option and is expected to be sold by
the end of the third quarter of fiscal 1999. There can be no assurances,
however, that this transaction will be completed. During the fourth quarter of
fiscal 1998, the Partnership and its co-venture partner had requested broker
proposals from two real estate firms with offices in Texas to market the
Chisholm Place apartments for sale. After reviewing their respective proposals
and conducting interviews, the Partnership and its co-venture partner selected a
local brokerage firm with extensive experience in marketing apartment
properties. Sales materials were finalized and extensive marketing efforts began
in late May 1998. As a result of this marketing process, the Partnership had
executed a purchase and sale agreement with an unrelated third party which was
then presented to the co-venture partner under the right of first refusal
provision of the joint venture agreement. It is currently contemplated that the
sale of the remaining asset and a liquidation of the Partnership could be
accomplished prior to the end of calendar year 1998. There are no assurances,
however, that the sale of the remaining asset and the liquidation of the
Partnership will be completed within this time frame.
<PAGE>
FORM 8-K
CURRENT REPORT
PAINE WEBBER GROWTH PROPERTIES LP
ITEM 7 - Financial Statements and Exhibits
(a) Financial Statements: None
(b) Exhibits:
(1)Purchase and Sale Agreement by and between Rocky Mountain Partners and
Tantra Lake Partners LP, dated October 16, 1998.
(2)Warranty Deed between Rocky Mountain Partners and Tantra Lake Partners,
LP dated October 30, 1998.
(3)Bill of Sale and General Assignment and Assumption Agreement by and from
Rocky Mountain Partners to and for the benefit of Tantra Lake Partners,
LP, dated October 30, 1998.
(4)Assignment and Assumption of Leases and Security Deposits between Rocky
Mountain Partners to and for the benefit of Tantra Lake Partners LP, dated
October 30, 1998.
(5)Final Closing Statement between Rocky Mountain Partners and Tantra Lake
Partners, LP, dated October 30, 1998.
(6)Purchase and Sale Agreement by and between Grouse Run Associates I and
Grouse Run Associates II and Grouse Run Partners, LP, dated October 16,
1998.
(7)Grant Deed by Grouse Run Associates I and Grouse Run Associates II to
Grouse Run Partners, LP, dated November 2, 1998.
(8)Bill of Sale and General Assignment and Assumption Agreement by Grouse Run
Associates I and Grouse Run Associates II to and for the benefit of Grouse
Run Partners, LP, dated November 2, 1998.
(9)Assignment and Assumption of Leases and Security Deposits between Grouse
Run Partners I and Grouse Run Partners II to and for the benefit of Grouse
Run Partners, LP, dated November 2, 1998.
(10) Seller's Final Closing Statement between Grouse Run Associates I and
Grouse Run Associates II and Grouse Run Partners, LP, dated November 2,
1998.
<PAGE>
FORM 8-K
CURRENT REPORT
PAINE WEBBER GROWTH PROPERTIES LP
SIGNATURE
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
PAINE WEBBER GROWTH PROPERTIES LP
---------------------------------
(Registrant)
By: First PW Growth Properties, Inc.
--------------------------------
By: /s/ Walter V. Arnold
--------------------
Walter V. Arnold
Senior Vice President and
Chief Financial Officer
Date: November 12, 1998
<PAGE>
PURCHASE AND SALE AGREEMENT
BY AND BETWEEN
ROCKY MOUNTAIN PARTNERS ("SELLER")
AND
TANTRA LAKE PARTNERS, L.P. ("BUYER")
THE TANTRA LAKE APARTMENTS
1000 WEST MOORHEAD CIRCLE
BOULDER, COLORADO
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE 1.....................................................................1
DEFINITIONS.............................................................1
ARTICLE 2.....................................................................4
PURCHASE AND SALE.......................................................4
ARTICLE 3.....................................................................4
PURCHASE PRICE; DEPOSIT; ADJUSTMENTS....................................4
ARTICLE 4.....................................................................7
PRECLOSING OPERATION....................................................7
ARTICLE 5.....................................................................8
INTENTIONALLY OMITTED...................................................8
ARTICLE 6.....................................................................8
TITLE AND SURVEY........................................................8
ARTICLE 7.....................................................................9
CONDITIONS PRECEDENT AND CLOSING........................................9
ARTICLE 8....................................................................13
CASUALTY AND CONDEMNATION..............................................13
ARTICLE 9....................................................................14
INTENTIONALLY OMITTED..................................................14
ARTICLE 10...................................................................14
DEFAULT, TERMINATION AND REMEDIES......................................14
ARTICLE 11...................................................................15
REPRESENTATIONS AND WARRANTIES.........................................15
ARTICLE 12...................................................................19
MISCELLANEOUS..........................................................19
ARTICLE 13...................................................................23
IRS FORM 1099-S DESIGNATION............................................23
LIST OF EXHIBITS
EXHIBIT A - THE LAND
EXHIBIT B - EARNEST MONEY ESCROW INSTRUCTIONS
EXHIBIT C - FORM OF ESCROW CLOSING INSTRUCTIONS
EXHIBIT D - DOCUMENTS
<PAGE>
PURCHASE AND SALE AGREEMENT
Tantra Lake Apartments
THIS PURCHASE AND SALE AGREEMENT (this "Agreement") is entered into as of
the 16th day of October, 1998 by and between Seller and Buyer, upon the
following terms and conditions:
WHEREAS, Seller desires to sell and Buyer desires to purchase, the
Property (hereinafter defined) on the terms and conditions hereinafter set
forth;
NOW THEREFORE, in consideration of the mutual undertakings, covenants and
agreements contained herein, and other good and valuable consideration the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
ARTICLE 1
DEFINITIONS
References in this Agreement to the following terms shall have the
following meanings:
Buyer: Tantra Lake Partners, L.P., a Delaware limited
- ------ partnership
Closing Date: See Section 7.3
- ------------
Deposit: See Section 3.1
- -------
Documents: Those materials listed on Exhibit D attached hereto.
- ---------
Environmental
Requirements: All laws, ordinances, statutes, codes, rules,
- ------------ regulations, agreements, judgments, orders and decrees
now or hereafter enacted, promulgated, or amended, of
the United States, the states, the counties, the
cities or any other political subdivisions in which
the Real Property is located and any other political
subdivision, agency or instrumentality exercising
jurisdiction over the owner of the Real Property, the
Real Property or the use of the Real Property relating
to pollution, the protection or regulation of human
health, natural resources or the environment, or the
emission, discharge, release or threatened release of
pollutants, contaminants, chemicals or industrial,
toxic or hazardous substances or waste or Hazardous
Materials into the environment (including, without
limitation, ambient air, surface water, ground water
or land or soil).
Escrowed Amount: See Section 3.1
- ---------------
Hazardous Substances: Any substance which is or contains: (i) any
- -------------------- "hazardous substance" as now or hereafter defined in
Section 101(14) of the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as
amended (42 U.S.C. Section 9601 et seq.) or any
regulations promulgated under CERCLA; (ii) any
"hazardous waste" as now or hereafter defined in the
Resource Conservation and Recovery Act (42 U.S.C.
Section 6901 et seq.) or regulations promulgated under
RCRA; (iii) any substance regulated by the Toxic
Substances Control Act (15 U.S.C. Section 2601
et. seq.); (iv) gasoline, diesel fuel or other
petroleum hydrocarbons; (v) asbestos and asbestos
containing materials, in any form, whether friable or
nonfriable; (vi) polychlorinated biphenyls;
(vii) radon gas; and (viii) any additional substances
or materials which are now or hereafter classified or
considered to be hazardous or toxic under
Environmental Requirements or the common law, or any
other applicable law related to the Property.
Hazardous Materials shall include, without limitation,
any substance, the presence of which on the Real
Property: (A) requires reporting, investigation or
remediation under Environmental Requirements;
(B) causes or threatens to cause a nuisance on the Real
Property or adjacent property or poses or threatens to
pose a hazard to the health or safety of persons on
the Real Property or adjacent property; or (C) if
emanated or migrated from the Real Property, could
constitute a trespass.
Improvements: All buildings, structures and other improvements
- ----------- situated upon the Land and all fixtures, systems and
facilities owned by Seller and located on the Land.
Intangible Property: All of Seller's right, title and interest, if
- ------------------- any, in all intangible assets of any nature relating
to the Land, the Improvements or the Personal
Property, including, without limitation, all of
Seller's right, title and interest in all
(i) warranties and guaranties relating to the
Improvements or Personal Property in the possession of
Seller, (ii) all licenses, permits and approvals
relating to the Real Property, (iii) all logos and
trade names currently used by Seller exclusively in
the operation of the Land and Improvements, including
the use of the name "Tantra Lake Apartments," and
(iv) all plans and specifications, in each case to the
extent that Seller may legally transfer the same.
Land: All of the land described on Exhibit A attached
- ---- hereto, together with all privileges, rights,
easements, water rights, tap rights and appurtenances
belonging to such land and all right, title and
interest (if any) of Seller in and to any streets,
alleys, passages, and other rights-of-way or
appurtenances included in, adjacent to or used in
connection with such land and all right, title and
interest (if any) of Seller in all mineral and
development rights appurtenant to such land.
Leases: All leases and other occupancy agreements covering any
- ------ portion of the Land or Improvements.
Personal Property: All furniture, carpeting, appliances, equipment,
- ----------------- machinery, inventories, supplies, signs and other
tangible personal property of every kind and nature,
if any, owned by Seller and installed, located at and
used in connection with the ownership, occupation and
operation of the Real Property. Personal Property
specifically excludes: (i) any items of personal
property owned by tenants at or on the Real Property,
and (ii) any items of personal property owned by third
parties and leased to Seller.
Property: The Real Property, the Personal Property, the Leases,
- -------- the Tenant Deposits, the Intangible Property and the
Property Contracts known as Tantra Lake Apartments,
located at 1000 West Moorhead Circle, Boulder,
Colorado.
Property Contracts: All of Seller's rights, if any, in all
- -------- service, supply and equipment rental, management,
operating and leasing contracts affecting the Property,
to the extent that (i) Seller is entitled to transfer
the same to Buyer, and (ii) Buyer does not elect to have
Seller terminate them in accordance with Section 4.3
below.
Purchase Price: $23,200,000
- ---------------
PW: PaineWebber Growth Properties LP, a Delaware limited
- --- partnership
Real Property: The Land and the Improvements.
- -------------
Seller: Rocky Mountain Partners, a Colorado General
- ------ Partnership
Tenant Deposits: Seller's rights to unapplied security deposits under
- --------------- the Leases.
Title Company: Fidelity National Title Insurance Company
- -------------
ARTICLE 2
PURCHASE AND SALE
2.1 Seller hereby agrees to sell and convey the Property to Buyer and
Buyer hereby agrees to buy the Property from Seller for the Purchase Price and
otherwise subject to the covenants, provisions, terms and conditions contained
herein.
ARTICLE 3
PURCHASE PRICE; DEPOSIT; ADJUSTMENTS
3.1 Deposit. Contemporaneously with the delivery of this Agreement (and as
a condition precedent to the effectiveness of this Agreement), Buyer shall
deposit immediately available funds with the Title Company (hereinafter the
"Escrow Agent") the sum of Three Hundred Fifty Thousand and No/100 Dollars
($350,000) (the "Deposit") to secure Buyer's obligations under this Agreement.
The Escrow Agent shall hold such Deposit in a segregated interest bearing money
market account with an FDIC insured bank reasonably acceptable to Buyer and
Seller. The Deposit and all interest accrued on the Deposit (collectively, the
"Escrowed Amount") shall be maintained by the Escrow Agent in such account or
accounts until the Escrow Agent is required to cause the Escrowed Amount to be
disbursed pursuant to the terms and conditions of this Agreement and the Earnest
Money Escrow Instructions attached hereto as Exhibit B. The Escrowed Amount
shall be applied to the Purchase Price if the Closing occurs, as provided in
Section 3.2 below.
3.2 Purchase Price. The Purchase Price, subject to adjustment as provided
herein, shall be as specified in Article 1 above and shall be paid on the
Closing Date (as hereinafter defined) in United States dollars by wire transfer
of federal funds, less the Escrowed Amount (the "Cash Balance").
3.3 Tax Proration. All due and payable real estate taxes, all general and
special assessments on the Land and ad valorem taxes, if any, on the Personal
Property (based on the most recent ascertainable taxes) attributable to the
Property through the Closing Date shall be prorated and adjusted as of the
Closing Date. 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
contemplated herein or from any improvements made or leases entered into on or
after the Closing Date. If the tax statements for the fiscal year during which
the Closing Date occurs are not finally determined, then the tax figures for the
immediately prior fiscal year shall be used for the purposes of prorating taxes
on the Closing Date, provided that there shall be no further adjustment to be
made after the Closing Date. Any tax refunds or proceeds (including interest
thereon) on account of a favorable determination resulting from a challenge,
protest, appeal or similar proceeding relating to taxes and assessments relating
to the Property (i) for all tax periods occurring prior to the applicable tax
period in which the Closing occurs shall be retained by and paid exclusively to
Seller and (ii) for the applicable tax period in which the Closing occurs shall
be prorated as of the Closing Date after reimbursement to Seller and Buyer, as
applicable, for all fees, costs and expenses (including reasonable attorneys'
and consultants' fees) incurred by Seller or Buyer, as applicable, in connection
with such proceedings such that Seller shall retain and be paid that portion of
such tax refunds or proceeds as is applicable to the portion of the applicable
tax period prior to the Closing Date and Buyer shall retain and be paid that
portion of such tax refunds or proceeds as is applicable to the portion of the
applicable tax period from and after the Closing Date. Neither Seller nor Buyer
shall settle any tax protests or proceedings in which taxes for the tax period
for which the other party is responsible are being adjudicated without the
consent of such party, which consent shall not be unreasonably withheld,
conditioned or delayed. After the Closing, Buyer shall be responsible for and
control any tax protests or proceedings for any period for which taxes are
adjusted between the parties under this Agreement and for any later period.
Buyer and Seller shall cooperate in pursuit of any such proceedings and in
responding to reasonable requests of the other for information concerning the
status of and otherwise relating to such proceedings; provided, however, that
neither party shall be obligated to incur any out-of-pocket fees, costs or
expenses in responding to the requests of the other.
3.4 Contract Proration. To the extent Property Contracts are not
terminated pursuant to Section 4.3, prepaid or past due amounts under any
Property Contracts which are assigned to Buyer at Closing shall be prorated and
adjusted as of the Closing Date.
3.5 Utility Proration. To the extent reasonably feasible, the Seller shall
cause all meters for electricity, gas, water, sewer or other public utility
usage at the Property to be read as of the day immediately preceding the Closing
Date, and the Seller shall pay all charges for such utilities which have accrued
on or prior to the Closing Date; provided, however, that if and to the extent
such charges are paid directly by tenants, no such reading or payment shall be
required. If the utility companies are unable or refuse to read meters for which
payment by the Seller is required, all charges for such utilities to the extent
unpaid shall be prorated and adjusted as of the Closing Date based on the most
recent bills therefor and no further adjustment shall be made. The Seller shall
provide notice to the Buyer within five (5) days of the Closing Date setting
forth (i) whether utility meters will be read as of the Closing Date and (ii) a
copy of the most recent bill for any utility charges which are to be prorated
and adjusted as of the Closing Date.
3.6 Income and Expense Proration. Collected rents for the then current and
any future period, security deposits which have not been previously applied by
Seller, prepaid rentals and all expenses and other charges in connection with
the operation of the Property shall be apportioned and full value shall be
adjusted as of the Closing Date, and the net amount thereof, if in favor of
Seller, shall be added to the Purchase Price, or if in favor of Buyer, shall be
deducted from the Purchase Price. From and after Closing all security deposits
credited to Buyer shall thereafter be deemed transferred to Buyer and Buyer
shall assume and be solely responsible for the payments of security deposits to
tenants in accordance with the Leases and applicable law. Seller shall be
entitled to retain or if transferred to Buyer receive a credit for any utility
deposits and any deposits for third parties under any of the Property Contracts.
In addition to the foregoing, at Closing the Purchase Price shall be increased
by the amount of uncollected or past due rent; provided, however, that no
adjustment shall be made for any rent which is more than two (2) months past
due. Seller shall be entitled to attempt to collect all rents and other charges
which are more than two (2) months past due but shall not be entitled to pursue
eviction proceedings in connection with such collection efforts. Notwithstanding
the foregoing, on the Closing Date there shall be an additional credit towards
the Purchase Price in favor of Buyer equal to three thousand dollars ($3,000)
for every one percent (1%) decrease in the percentage of leased units at the
Property below ninety-two percent (92%) (the "Lease Credit"), which Lease Credit
may be apportioned for partial percentage decreases below ninety-two percent
(92%), rounded to the nearest tenth of one percentage point. For purposes of
determining the amount of the Lease Credit to be given to Buyer at Closing, if
any, Buyer and Seller agree to rely upon the percentage of leased units set
forth in the updated Rent Roll to be provided by Seller to Buyer at Closing
pursuant to Section 7.4.
3.7 Prorations Generally. A statement of prorations and other adjustments
shall be prepared by Seller in conformity with the provisions of this Article 3
and submitted to Buyer for review and approval not less than five (5) business
days prior to the Closing Date. For purposes of making prorations, Seller shall
be deemed to be in title to the Property and entitled to the income from and
responsible for the expenses thereof, on the Closing Date.
3.8 Closing Costs.
(a) Seller shall pay: (i) its legal fees and expenses related to the
negotiation and preparation of this Agreement and all documents required
to close the transaction contemplated hereby, (ii) 50% of the escrow fees
of the Escrow Agent; and (iii) all costs associated with title examination
and preparation of a title commitment as well as all charges and premiums
for an ALTA 1992 form of owner's title policy issued by the Title Company,
excluding fees associated with endorsements to such policy.
(b) Buyer shall pay: (i) 50% of the escrow fees of the Escrow Agent,
(ii) charges to record the deed, and evidence of Buyer's existence or
authority, (iii) Buyer's legal fees and expenses related to the
negotiation of this Agreement and all documents required to close the
transaction contemplated hereby, (iv) all costs related to the Buyer's
inspection and due diligence, including, without limitation, the cost of
appraisals, architectural, engineering, credit and environmental reports,
(v) all charges for endorsements to the owner's title insurance policy,
(vi) all costs allocable to preparation of the Survey, and (vii) all
state, county or other taxes associated with the transfer of the property.
(c) All other closing costs shall be paid by Seller or Buyer in
accordance with the custom in the jurisdiction where the Property is
located.
ARTICLE 4
PRECLOSING OPERATION
4.1 Leases. During the pendency of this Agreement, Seller may enter into
Leases with new tenants or modifications of Leases with existing tenants
substantially in accordance with Seller's existing leasing practices, provided
that in all events any new or modified Leases shall (i) be at or near market
rent, (ii) be for a term of not more than one (1) year (with respect to
residential Leases only), and (iii) on the Seller's current standard form of
lease. From the date hereof through the Closing, Seller shall not apply security
deposits to delinquent rents under the Leases other than in the ordinary course
of business.
4.2 Conduct of Business. At all times from and after the date hereof,
Seller shall continue (a) to conduct business with respect to the Property in
the same manner in which said business has been heretofore conducted, (b) to
insure the Property substantially as currently insured, and (c) maintain the
Property in its current condition, reasonable wear and tear and damage by
casualty excepted, including ordinary preparation for occupancy of residential
units vacated prior to Closing.
4.3 Property Contracts. Buyer shall provide written notice to Seller of
the Property Contracts that Buyer desires to have terminated by Seller not less
than ten (10) days prior to the Closing Date, and Seller will terminate the
Property Contracts so identified at or before Closing, provided that such
Property Contracts may be terminated without cost or liability to Seller and if
there is cost or liability to Seller, Buyer shall be responsible for any such
liability. At Closing, Seller shall assign and Buyer shall assume the Property
Contracts, except those Property Contracts which Seller has agreed to terminate.
<PAGE>
ARTICLE 5
INTENTIONALLY OMITTED
ARTICLE 6
TITLE AND SURVEY
6.1 Subsequently Arising Exceptions. In the event that any encumbrance,
lien or other title matter to which Buyer objects, other than (i) those matters
listed in Section 6.2 below and (ii) any matters created voluntarily or
involuntarily created or assumed by Buyer and not voluntarily created or assumed
by PW, first arises following the date hereof, Buyer shall have the right to
object to any such encumbrance, lien or other title matter by providing written
notice thereof to PW at or prior to the Closing or by providing oral or written
notice thereof if such encumbrance, lien or other title matter is discovered in
connection with the final title rundown at the Closing (any and all such
encumbrances, liens and other title matters specified in such notice are
hereinafter collectively referred to as "Subsequently Arising Exceptions"). If
Buyer fails to give such notice to PW at or prior to the Closing, all
encumbrances, liens or other title matters existing with respect to the Property
which are in existence as of such date shall thereafter be conclusively deemed
satisfactory to Buyer in all respects and Buyer shall be conclusively deemed to
have waived all objections thereto. If Buyer gives timely notice to PW of any
Subsequently Arising Exception, PW agrees to use reasonable efforts to cure the
same (provided, however, that PW shall not be obligated to incur any costs or
expenses in excess of ($10,000) (the "Cure Amount") in connection with any such
cure undertaken by PW. Seller shall, however, be obligated on or before Closing
to pay or discharge any and all liens or encumbrances that constitute a lien on
the Property for the purpose of securing a monetary obligation of Seller that PW
consented to.
6.2 Deed. On the Closing Date, Seller shall convey title to the Property
by good and sufficient special warranty deed (the "Deed") to Buyer fee simple
title to all of the Real Property and a special warranty deed conveying any
water rights relating thereto free and clear of all liens, encumbrances,
conditions, easements, assessments, restrictions and other conditions, except
for the following:
(a) All Leases;
(b) All zoning, building and other laws applicable to the Property;
(c) All matters which arise after the date hereof which are agreed
upon or consented to by Buyer;
(d) The lien, if any, for real estate taxes for the current year not
due and payable prior to the Closing Date (subject to proration in
accordance with Section 3.3 herein);
(e) All matters of public record as of the effective date and shown
on the title commitment listed on Exhibit D (the "Title Commitment");
(f) Those exceptions or title deficiencies which (i) Buyer does not
object to pursuant to Section 6.1 or (ii) are waived by Buyer because
Seller is unwilling or unable to cure (the "Permitted Exceptions").;
(g) Any matters shown on the Survey or any survey or updated survey
prepared by or for the benefit of Buyer; and
(h) All matters, whether or not of record, to the extent caused by
Buyer or its agents, representatives or contractors.
6.3 Lease Assignment. At the Closing, Seller shall assign the Leases to
Buyer and Buyer shall assume Seller's obligations thereunder and Seller shall
convey the Personal Property to Buyer by quitclaim bill of sale.
ARTICLE 7
CONDITIONS PRECEDENT AND CLOSING
7.1 Buyer's Conditions Precedent. In addition to any other conditions
precedent in favor of Buyer as may be set forth elsewhere in this Agreement,
Buyer's obligations under this Agreement are expressly subject to the timely
fulfillment of the conditions set forth in this Section 7.1 on or before the
Closing Date, or such earlier date as is set forth below. Each condition may be
waived in whole or in part only by written notice of such waiver from Buyer to
Seller.
(a) Seller performing and complying in all material respects with
all of the terms of this Agreement to be performed and complied with by
Seller prior to or at the Closing.
(b) On the Closing Date, all of the representations of Seller set
forth in this Agreement shall continue to be true, accurate and complete.
(c) Buyer shall have received evidence that RREEF America, L.L.C.
has released any claims it may have against Buyer or Seller arising out of
that certain Purchase and Sale Agreement by and between Rocky Mountain
Partners and The RREEF America, L.L.C. with respect to the Property.
Notwithstanding the foregoing, if the conditions set forth in this Section
7.1 or any other condition of Closing (other than an obligation of Buyer under
Section 7.2 below) shall not have been fulfilled on or before the Closing Date,
Seller and Buyer may mutually agree to extend the Closing Date for a period of
up to thirty (30) days to provide additional time for the fulfillment of such
conditions. Upon any such extension, the term "Closing Date" as used herein
shall mean the date set forth in such written notice from Seller.
7.2 Seller's Conditions Precedent. In addition to any other conditions
precedent in favor of Seller as may be set forth elsewhere in this Agreement,
Seller's obligations under this Agreement are expressly subject to the timely
fulfillment of the conditions set forth in this Section 7.2 on or before the
Closing Date, or such earlier date as is set forth below. Each condition may be
waived in whole or part only by written notice of such waiver from Seller to
Buyer.
(a) Buyer performing and complying in all material respects with all
of the terms of this Agreement to be performed and complied with by Buyer
prior to or at the Closing, including, without limitation, payment by the
Buyer of the Purchase Price (as adjusted as otherwise provided herein);
and
(b) On the Closing Date, all of the representations of Buyer set
forth in this Agreement shall continue to be true, accurate and complete.
7.3 Closing Date. Subject to Seller's right to extend the Closing Date as
provided in Section 7.1, the consummation of the purchase and sale contemplated
in this Agreement (the "Closing") shall occur through an escrow closing
arrangement as described in Schedule F attached hereto on November 6, 1998 (the
"Closing Date"), at the office of the Escrow Agent or through the escrow closing
arrangements set forth in the Form of Escrow Closing Instructions attached
hereto as Exhibit F. Buyer may accelerate the Closing Date by providing Seller
with three business days prior notice.
7.4 Closing Deliveries. On the Closing Date, Seller shall deliver or cause
to be delivered, in each case in a form reasonably acceptable to Buyer and
Seller:
(a) A duly executed and acknowledged Deed or Deeds conveying the
Land and the Improvements to Buyer;
(b) A duly executed quitclaim bill of sale and general assignment
conveying the Personal Property and the Intangible Property to Buyer;
(c) A duly executed assignment and assumption of the Leases and
Tenant Deposits (the "Assignment of Leases");
(d) A duly executed assignment and assumption of Property Contracts
being assumed (the "Assignment of Contracts");
(e) A certificate or certificates of non-foreign status from Seller;
(f) Customary affidavits sufficient for the Escrow Agent to delete
any exceptions for mechanic's or materialmen's liens and parties in
possession from Buyer's title policy and such other affidavits relating to
such title policy as the Escrow Agent may reasonably request;
(g) An updated rent roll (including a list of all delinquent and
prepaid rents) certified by the Seller as true and correct as of the
Closing Date;
(h) Such other instruments as Buyer or the Escrow Agent may
reasonably request to effectuate the transactions contemplated by this
Agreement;
(i) A duly executed counterpart original of the closing statement
setting forth the Purchase Price, the closing adjustments and the
application of the Escrowed Amount as adjusted;
(j) Evidence or documents as may reasonably be required by the
Escrow Agent evidencing the status and capacity of Seller to sell the
Property and the authority of the person or persons executing the various
documents on behalf of Seller in connection with the sale of the Property;
(k) Originals, or where unavailable, copies of all Property
Contracts, Leases (with all amendments and modifications thereto),
operating information, permits, warranties and financial information about
the Property in Seller's possession or control relating to the Property;
(l) All keys to all locks on the Property and similar items, to the
extent in Seller's possession; and
(m) A certificate executed by Seller certifying that the
representations and warranties of Seller contained in Section 11.2 herein
are true and correct as of the Date of Closing.
7.5 Buyer's Deliveries. On the Closing Date, Buyer shall deliver or cause
to be delivered at its expense each of the following to Seller:
(a) The Purchase Price for the Property, as such Purchase Price may
have been adjusted pursuant to the provisions of this Agreement and
credited for any portion of the Escrowed Amount paid to Seller, in the
manner provided for in Article 3;
(b) Evidence in form and substance reasonably satisfactory to Escrow
Agent and Seller of Buyer's authority to purchase the Property;
(c) The Assignment of Leases;
(d) The Assignment of Contracts;
(e) Such other instruments as Seller or Escrow Agent may reasonably
request to effectuate the transactions contemplated by this Agreement;
(f) A duly executed counterpart original of the closing statement
setting forth the Purchase Price, the closing adjustments and the
application of such amounts;
(g) Such evidence or documents as may reasonably be required by the
Escrow Agent evidencing the status and capacity of Buyer and the authority
of the person or persons who are executing the various documents on behalf
of Buyer in connection with the purchase of the Property;
(h) Acknowledgment by Buyer of Buyer's receipt (or constructive
receipt) from Seller of the Tenant Deposits;
(i) Executed counterparts of any other documents listed in Section
7.4 required to be signed by Buyer; and
(j) A certificate executed by Buyer certifying that the
representations and warranties of Buyer contained in Section 11.1 herein
are true and correct as of the Date of Closing.
7.6 Possession. Possession of the Property shall be delivered to Buyer by
Seller at the Closing, subject only to those items listed in Section 6.2 of this
Agreement and rights arising under any Property Contracts not terminated by
Seller pursuant to Section 4.3. Seller and Buyer covenant and agree to execute,
at Closing, a written notice of the acquisition of the Property by Buyer, for
duplication and transmittal to all tenants affected by the sale and purchase of
the Property (or otherwise in such manner as will comply with applicable law
respecting notification of tenants). Such notice shall be prepared by Buyer and
approved by Seller, shall notify the tenants of the sale and transfer and shall
contain appropriate instructions relating to the payment of future rentals, the
giving of future notices, and other matters reasonably required by Buyer or
required by law. Unless a different procedure is required by applicable law, in
which event such laws shall be controlling, Buyer agrees to transmit or
otherwise deliver such letters to the tenants promptly after the Closing.
ARTICLE 8
CASUALTY AND CONDEMNATION
8.1 Casualty. If the Improvements are damaged by fire or any other
casualty and are not substantially restored to the condition immediately prior
to such casualty before the Closing Date, Buyer shall have the following
elections:
(a) to purchase the Property in its then condition and pay the
Purchase Price subject to adjustment as set forth below, in which event
Seller shall pay over or assign to Buyer as the case may be, on the
Closing Date, amounts recovered or recoverable by Seller on account of any
insurance as a result of such casualty up to the amount of the Purchase
Price, less any amounts reasonably expended by Seller for partial
restoration and Seller shall give Buyer a credit towards the Cash Balance
due at Closing in an amount equal to any deductible or uninsured amounts
applicable to such casualty; or
(b) if any portion of the Improvements suffers damage in excess of
$1,000,000 from fire or any other casualty, to terminate this Agreement by
giving notice of termination to Seller on or before that date which is
thirty (30) days after the occurrence of the fire or other casualty or on
the Closing Date, whichever occurs first, in which event the Escrow Agent
shall return the Escrowed Amount to Buyer, this Agreement shall terminate
and neither Seller nor Buyer shall have any recourse against the other
(except to the extent such recourse arises in connection with a provision
of this Agreement which is intended to survive termination).
8.2 Condemnation. If any substantial portion of or interest in the
Property (which, for purposes of this Section 8.2, shall be deemed to include
all or any portion of the means of access to the Property, any parking spaces at
the Property or any units at the Property) shall be taken or is in the process
of being taken by exercise of the power of eminent domain or if any governmental
authority notifies Seller prior to the Closing Date of its intent to take or
acquire any portion of or interest in the Property (each an "Eminent Domain
Taking"), Seller shall give notice promptly to Buyer of such event and Buyer
shall have the option to terminate this Agreement by providing notice to Seller
to such effect on or before the date which is ten (10) days from Seller's notice
to Buyer of such Eminent Domain Taking or on the Closing Date, whichever occurs
first, in which event the Escrow Agent shall return the Escrowed Amount to
Buyer, this Agreement shall terminate, and neither Seller nor Buyer shall have
any recourse against the other (except to the extent such recourse arises in
connection with a provision of this Agreement which is intended to survive
termination). If Buyer does not timely notify Seller of its election to
terminate this Agreement, Buyer shall purchase the Property and pay the Purchase
Price, and Seller shall pay over or assign to Buyer on delivery of the Deed
awards recovered or recoverable by Seller on account of such Eminent Domain
Taking up to the amount of the Purchase Price, less any amounts reasonably
expended by Seller in obtaining such award.
ARTICLE 9
INTENTIONALLY OMITTED
ARTICLE 10
DEFAULT, TERMINATION AND REMEDIES
10.1 Seller's Default. In the event that Seller defaults in its obligation
to close hereunder, Buyer shall have the right to (i) terminate this Agreement
and receive the Escrowed Amount, whereupon this Agreement shall terminate
without further recourse or, (ii) take any and all legal actions necessary to
compel the Seller's specific performance hereunder (it being acknowledged that
damages at law would be an inadequate remedy), and to consummate the transaction
contemplated by this Agreement in accordance with the provisions of this
Agreement (such conveyance shall be deemed as satisfied and waive any other
remedy). Buyer hereby waives and relinquishes any right to sue Seller for any
reason whatsoever, and agrees that Seller shall not be liable to Buyer for any
actual, punitive, speculative, consequential or other damages for breach by
Seller prior to the Closing, except for return of the Escrowed Amount. IN NO
EVENT SHALL SELLER, ITS DIRECT OR INDIRECT PARTNERS, SHAREHOLDERS, OWNERS OR
AFFILIATES, ANY OFFICER, DIRECTOR, EMPLOYEE OR AGENT OF THE FOREGOING, OR ANY
AFFILIATE OR CONTROLLING PERSON THEREOF, HAVE ANY LIABILITY BEYOND ITS INTEREST
IN THE PROPERTY FOR ANY CLAIM, CAUSE OF ACTION OR OTHER LIABILITY ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR THE PROPERTY, WHETHER BASED ON COMMON LAW,
CONTRACT, STATUTE, EQUITY OR OTHERWISE.
10.2 Buyer's Default. In the event that Buyer defaults in its obligation
to close hereunder, PW shall be entitled to receive the Escrowed Amount as
liquidated damages, in lieu of all other remedies available to PW at law or in
equity for such default (but subject to the final two (2) sentences of this
Section 10.2), and Buyer shall direct the Escrow Agent to release the Escrowed
Amount to PW. PW and Buyer agree that the damages resulting to PW as a result of
such default by Buyer as of the date of this Agreement are difficult or
impossible to ascertain and the liquidated damages set forth in the preceding
sentence constitute Buyer's and PW's reasonable estimate of such damages.
Notwithstanding the foregoing, in the event of Buyer's default or a termination
of this Agreement, PW shall have all remedies available at law or in equity in
the event Buyer or any party related to or affiliated with Buyer asserts any
claims or rights to the Property that would otherwise delay or prevent PW from
having clear, indefeasible and marketable title to the Property. In addition to
the foregoing remedies, in accordance with Section 7.05(d) of the Seller's
partnership agreement (the "LP Agreement"), in the event Buyer defaults in its
obligations hereunder, PW acting singly on behalf of Seller may, at any time for
a period of 120 days after such default, cause the Seller to sell the Property
to any person at a price and on terms no less favorable to the Seller than those
applicable to Buyer hereunder. Seller acknowledges that the Escrowed Amount made
hereunder is in lieu of the twenty percent deposit required pursuant to Seller's
LP Agreement and that should Buyer default in its obligations hereunder,
Seller's sole remedy (except as otherwise set forth in this Section 10.2) shall
be to retain the Escrowed Amount and Seller shall have no claim or right to
payment of twenty percent deposit set forth in Seller's LP Agreement.
ARTICLE 11
REPRESENTATIONS AND WARRANTIES
11.1 Buyer's Representations and Warranties. Buyer represents and warrants
to Seller that:
(a) Buyer is a limited partnership, duly organized and in good
standing under the laws of the State of Delaware, is qualified to do
business in the State of Colorado and has the power and authority to enter
into this Agreement and to execute and deliver this Agreement and to
perform all duties and obligations imposed upon it hereunder. As of the
date of this Agreement, Buyer has obtained all necessary corporate,
partnership or other organizational authorizations required in connection
with the execution and delivery of this Agreement. The individual
executing this Agreement on Buyer's behalf is authorized to do so. At
Closing, Buyer shall have the financial ability to pay the Purchase Price
by (i) tendering the Cash Balance, and performing the other covenants of
Buyer set forth in this Agreement.
(b) Neither the execution nor the delivery of this Agreement, nor
the consummation of the purchase and sale transaction contemplated hereby,
nor the fulfillment of or compliance with the terms and conditions of this
Agreement conflict with or will result in the breach of any of the terms,
conditions or provisions of any agreement or instrument to which Buyer is
a party or by which Buyer or any of Buyer's assets is bound;
(c) No approval, consent, order or authorization of, or designation,
registration or declaration with, any of the United States, the State of
Colorado, any department, board, agency, office, commission or other
subdivisions thereof, or any official thereof or any third party is
required in connection with the valid execution and delivery of, and
performance of the covenants of, this Agreement by Buyer.
(d) There are no actions, suits or proceedings pending or, to the
knowledge of Buyer, threatened, against or affecting Buyer which, if
determined adversely to Buyer, would adversely affect its ability to
perform its obligations hereunder.
Prior to the Closing Date, Buyer shall notify Seller in writing of any
facts, conditions or circumstances which render any of the representations and
warranties set forth in this Section 11.1 in any way inaccurate, incomplete,
incorrect or misleading.
11.2 Seller's Representations and Warranties. Seller represents and
warrants to Buyer that:
(a) Seller is a general partnership existing under the laws of the
State of Colorado.
(b) Seller has full right, power and authority and is duly
authorized to enter into this Agreement and by the Closing Date shall have
the authority to perform each of the covenants on its part to be performed
hereunder and to execute and deliver this Agreement, and to perform its
obligations under all documents required to be executed and delivered by
it pursuant to this Agreement and this Agreement constitutes the valid and
binding obligation of Seller enforceable in accordance with its terms.
(c) To Seller's knowledge, Seller's property manager at the Property
has delivered or will deliver or has made available or will make available
to Buyer (i) complete copies of all Leases and (ii) the Rent Roll.
(d) Seller has caused the property manager at the Property to
deliver or to make available copies of all Property Contracts.
(e) To Seller's knowledge, except as set forth on Schedule 11.2,
Seller has not been served with written notice of any actions, suits, or
proceedings against or affecting the Seller or the Property that either
(i) are not covered by applicable insurance or (ii) if determined
adversely to Seller would materially affect the ownership or operation of
the Property or Seller's ability to perform its obligations under this
Agreement.
(f) Neither the execution nor the delivery of this Agreement, nor
the consummation of the purchase and sale transaction contemplated hereby,
nor the fulfillment of or compliance with the terms and conditions of this
Agreement conflict with or will result in the breach of any of the terms,
conditions or provisions of any agreement or instrument to which Seller or
Paine Webber Growth Properties LP is a party or by which Seller or any of
Seller's assets is bound.
Prior to the Closing Date, Seller shall notify Buyer in writing of any
facts, conditions or circumstances which render any of the representations and
warranties set forth in this Section 11.2 in any way inaccurate, incomplete,
incorrect or misleading. Notwithstanding the foregoing, all of Seller's
representations and warranties shall be deemed to be updated by information
disclosed to or obtained by Purchaser in connection with its due diligence
investigations.
11.3 Seller; Seller's Knowledge. Whenever a representation is made to
"Seller's knowledge", or a term of similar import, the accuracy of such
representation shall be based solely on the actual knowledge of Celia Deluga,
without independent investigation or inquiry except for inquiry of the property
manager for the Property. Notwithstanding the foregoing, if, prior to the
Closing, Buyer obtains actual knowledge that any representation or warranty of
Seller is inaccurate and Buyer nonetheless proceeds with the Closing, Seller
shall have no liability for any such matter regarding which Buyer had actual
knowledge prior to Closing.
11.4 Property Conveyed "AS IS". (a) NOTWITHSTANDING ANYTHING CONTAINED
HEREIN TO THE CONTRARY, IT IS UNDERSTOOD AND AGREED THAT, EXCEPT AS EXPRESSLY
SET FORTH HEREIN, SELLER AND ITS PROPERTY MANAGER HAVE NOT MADE AND ARE NOT NOW
MAKING, AND THEY SPECIFICALLY DISCLAIM, ANY OTHER WARRANTIES, REPRESENTATIONS OR
GUARANTIES OF ANY KIND OR CHARACTER, EXPRESS OR IMPLIED, ORAL OR WRITTEN, PAST,
PRESENT OR FUTURE, WITH RESPECT TO THE PROPERTY, INCLUDING, BUT NOT LIMITED TO,
WARRANTIES, REPRESENTATIONS OR GUARANTIES AS TO (I) MATTERS OF TITLE (OTHER THAN
SELLER'S WARRANTY OF TITLE SET FORTH IN THE DEED (HEREINAFTER DEFINED) TO BE
DELIVERED AT CLOSING), (II) ENVIRONMENTAL MATTERS RELATING TO THE PROPERTY OR
ANY PORTION THEREOF, (III) GEOLOGICAL CONDITIONS, INCLUDING, WITHOUT LIMITATION,
SUBSIDENCE, SUBSURFACE CONDITIONS, WATER TABLE, UNDERGROUND WATER RESERVOIRS,
LIMITATIONS REGARDING THE WITHDRAWAL OF WATER, AND EARTHQUAKE FAULTS AND THE
RESULTING DAMAGE OF PAST AND/OR FUTURE EARTHQUAKES, (IV) WHETHER, AND TO THE
EXTENT TO WHICH THE PROPERTY OR ANY PORTION THEREOF IS AFFECTED BY ANY STREAM
(SURFACE OR UNDERGROUND), BODY OF WATER, FLOOD PRONE AREA, FLOOD PLAIN, FLOODWAY
OR SPECIAL FLOOD HAZARD, (V) DRAINAGE, (VI) SOIL CONDITIONS, INCLUDING THE
EXISTENCE OF INSTABILITY, PAST SOIL REPAIRS, SOIL ADDITIONS OR CONDITIONS OF
SOIL FILL, OR SUSCEPTIBILITY TO LANDSLIDES, OR THE SUFFICIENCY OF ANY
UNDERSHORING, (VII) ZONING TO WHICH THE PROPERTY OR ANY PORTION THEREOF MAY BE
SUBJECT, (VIII) THE AVAILABILITY OF ANY UTILITIES TO THE PROPERTY OR ANY PORTION
THEREOF INCLUDING, WITHOUT LIMITATION, WATER, SEWAGE, GAS AND ELECTRIC, (IX)
USAGES OF ADJOINING PROPERTY, (X) ACCESS TO THE PROPERTY OR ANY PORTION THEREOF,
(XI) THE VALUE, COMPLIANCE WITH THE PLANS AND SPECIFICATIONS, SIZE, LOCATION,
AGE, USE, DESIGN, QUALITY, DESCRIPTION, SUITABILITY, STRUCTURAL INTEGRITY,
OPERATION, TITLE TO, OR PHYSICAL OR FINANCIAL CONDITION OF THE PROPERTY OR ANY
PORTION THEREOF, OR ANY INCOME, EXPENSES, CHARGES, LIENS, ENCUMBRANCES, RIGHTS
OR CLAIMS ON OR AFFECTING OR PERTAINING TO THE PROPERTY OR ANY PART THEREOF, OR
ANY INCOME, EXPENSES, CHARGES, LIENS, ENCUMBRANCES, RIGHTS OR CLAIMS ON OR
AFFECTING OR PERTAINING TO THE PROPERTY OR ANY PART THEREOF, (XII) THE PRESENCE
OF HAZARDOUS SUBSTANCES (HEREINAFTER DEFINED) IN OR ON, UNDER OR IN THE VICINITY
OF THE PROPERTY, (XIII) THE CONDITION OR USE OF THE PROPERTY OR COMPLIANCE OF
THE PROPERTY WITH ANY OR ALL PAST, PRESENT OR FUTURE FEDERAL, STATE OR LOCAL
ORDINANCES, RULES, REGULATIONS OR LAWS, BUILDING, FIRE OR ZONING ORDINANCES,
CODES OR OTHER SIMILAR LAWS, (XIV) THE EXISTENCE OR NON-EXISTENCE OF UNDERGROUND
STORAGE TANKS, (XV) ANY OTHER MATTER AFFECTING THE STABILITY OR INTEGRITY OF THE
REAL PROPERTY, (XVI) THE POTENTIAL FOR FURTHER DEVELOPMENT OF THE PROPERTY,
(XVII) THE EXISTENCE OF VESTED LAND USE, ZONING OR BUILDING ENTITLEMENTS
AFFECTING THE PROPERTY, (XVIII) THE MERCHANTABILITY OF THE PROPERTY OR FITNESS
OF THAT PROPERTY FOR ANY PARTICULAR PURPOSE (BUYER AFFIRMING THAT BUYER HAS NOT
RELIED ON SELLER'S OR ITS PROPERTY MANAGER'S SKILL OR JUDGMENT TO SELECT OR
FURNISH THE PROPERTY FOR ANY PARTICULAR PURPOSE, AND THAT SELLER MAKES NO
WARRANTY THAT THE PROPERTY IS FIT FOR ANY PARTICULAR PURPOSE), OR (XIX) TAX
CONSEQUENCES.
(b) BUYER HAS NOT RELIED UPON AND WILL NOT RELY UPON, EITHER
DIRECTLY OR INDIRECTLY, ANY REPRESENTATION OR WARRANTY OF SELLER OR ITS PROPERTY
MANAGER OR ANY OF THEIR RESPECTIVE AGENTS, EXCEPT AS EXPRESSLY SET FORTH HEREIN,
AND ACKNOWLEDGES THAT NO OTHER SUCH REPRESENTATIONS HAVE BEEN MADE. BUYER
REPRESENTS THAT IT IS A KNOWLEDGEABLE, EXPERIENCED AND SOPHISTICATED BUYER OF
REAL ESTATE AND THAT IT IS RELYING SOLELY ON ITS OWN EXPERTISE AND THAT OF
BUYER'S CONSULTANTS IN PURCHASING THE PROPERTY. BUYER WILL CONDUCT SUCH
INSPECTIONS AND INVESTIGATIONS OF THE PROPERTY AS BUYER DEEMS NECESSARY,
INCLUDING, BUT NOT LIMITED TO, THE PHYSICAL AND ENVIRONMENTAL CONDITIONS
THEREOF, AND SHALL RELY UPON SAME. UPON CLOSING, BUYER SHALL ASSUME THE RISK
THAT ADVERSE MATTERS, INCLUDING, BUT NOT LIMITED TO, ADVERSE PHYSICAL AND
ENVIRONMENTAL CONDITIONS, MAY NOT HAVE BEEN REVEALED BY BUYER'S INSPECTIONS AND
INVESTIGATIONS. BUYER ACKNOWLEDGES AND AGREES THAT UPON CLOSING, SELLER SHALL
SELL AND CONVEY TO BUYER AND BUYER SHALL ACCEPT THE PROPERTY "AS IS, WHERE IS",
WITH ALL FAULTS. BUYER FURTHER ACKNOWLEDGES AND AGREES THAT THERE ARE NO ORAL
AGREEMENTS, WARRANTIES OR REPRESENTATIONS, COLLATERAL TO OR AFFECTING THE
PROPERTY BY SELLER, ANY AGENT OF SELLER OR ANY THIRD PARTY. THE TERMS AND
CONDITIONS OF THIS SECTION 11.4(B) SHALL EXPRESSLY SURVIVE THE CLOSING, AND
SHALL NOT MERGE WITH THE PROVISIONS OF ANY CLOSING DOCUMENTS. SELLER IS NOT
LIABLE OR BOUND IN ANY MANNER BY ANY ORAL OR WRITTEN STATEMENTS,
REPRESENTATIONS, OR INFORMATION PERTAINING TO THE PROPERTY FURNISHED BY ANY REAL
ESTATE BROKER, AGENT, EMPLOYEE, SERVANT OR OTHER PERSON, UNLESS THE SAME ARE
SPECIFICALLY SET FORTH OR REFERRED TO HEREIN. BUYER ACKNOWLEDGES THAT THE
PURCHASE PRICE REFLECTS THE "AS IS" NATURE OF THIS SALE AND ANY FAULTS,
LIABILITIES, DEFECTS OR OTHER ADVERSE MATTERS THAT MAY BE ASSOCIATED WITH THE
PROPERTY. BUYER HAS FULLY REVIEWED THE DISCLAIMERS AND WAIVERS SET FORTH IN THIS
AGREEMENT WITH ITS COUNSEL AND UNDERSTANDS THE SIGNIFICANCE AND EFFECT THEREOF.
--------------
Buyer's Initials
ARTICLE 12
MISCELLANEOUS
12.1 Successors and Assigns. Without the prior written consent of Seller,
Buyer shall not, directly or indirectly, assign this Agreement or any of its
rights hereunder. Any attempted assignment in violation hereof shall, at the
election of Seller in its sole discretion, be of no force or effect and shall
constitute a default by Buyer. Notwithstanding the foregoing and so long as it
will not affect the timing of the Closing, Buyer may elect to have a nominee
entity accept title to the Property at Closing, provided that any such nominee
must be an affiliated entity controlled by or under common control with Buyer,
and Buyer shall give written notice of such nominee to Seller, together with
reasonable evidence of affiliation requested by Seller, a minimum of fifteen
(15) days prior to Closing. No designation of a nominee to receive title shall
release Buyer from its obligations under this Agreement.
12.2 Notices. Except as otherwise specifically provided herein, any notice
required or permitted to be delivered under this Agreement shall be in writing
and shall be deemed given (i) when delivered or refused if sent by hand during
regular business hours, (ii) three (3) days after being sent by United States
Postal Service, registered or certified mail, postage prepaid, return receipt
requested, (iii) on the next business day when sent by a reputable overnight
express mail service that provides tracing and proof of receipt or refusal of
items mailed, addressed to Seller or Buyer, as the case may be, at the address
or addresses set forth below or such other addresses as the parties may
designate in a notice similarly sent, or (iv) on the day of receipt if such day
is a business day when sent by facsimile, otherwise on the next business day
after receipt, as evidenced by a facsimile confirmation receipt. Any notice
given by a party to Escrow Agent shall be simultaneously given to the other
party. Any notice given by a party to the other party relating to its
entitlement to the Escrowed Amount shall be simultaneously given to the Escrow
Agent.
(1) If to Seller:
c/o Paine Webber Properties Incorporated
265 Franklin Street - 15 Floor
Boston, MA 02110
Attn: Ms. Celia Deluga
Fax: (617) 345-8752
with a copy to:
Goodwin, Procter & Hoar LLP
Exchange Place
Boston, MA 02109
Attn: Andrew C. Sucoff, Esq.
Fax: (617) 227-8591
(2) If to Buyer:
Sares Regis
18802 Bardeen Avenue
Irvine, California 92612
Attn: Geoffrey L. Stack and Bill Thormahlen
Fax: (949) 756-5955
with a copy to:
Pinto & Dubia LLP
2 Park Plaza, Suite 300
Irvine, CA 92614-8513
Attn: Kenneth Ryder, Esq.
Fax: (949) 833-2067
and a copy to:
Morgan, Lewis & Bockius
300 S. Grand Avenue, 22nd Floor
Los Angeles, CA 90071-3132
Attn: William Ellis, Esq.
Fax: (213) 612-2554
and a copy to:
Citibank-GREIO
153 East 53rd Street
56th Floor, Zone 7
New York, NY 10043
Attn: Tim Donahoe
Fax: (212) 793-2091
(3) If to the Escrow Agent:
Fidelity National Title Insurance Company
12.3 Construction. Words of any gender used in this Agreement shall be
held and construed to include any other gender, and words of a singular number
shall be held to include the plural and vice versa, unless the context requires
otherwise.
12.4 Captions. The captions used in connection with the Articles of this
Agreement are for convenience only and shall not be deemed to extend, limit or
otherwise define or construe the meaning of the language of this Agreement.
12.5 No Other Parties. Nothing in this Agreement, express or implied, is
intended to confer upon any person, other than the parties hereto and their
respective successors and assigns, any rights or remedies under or by reason of
this Agreement.
12.6 Amendments. This Agreement may be amended only by a written
instrument executed by Seller and Buyer (or Buyer's assignee or transferee).
12.7 Severability. If any provision of this Agreement or application to
any party or circumstance shall be determined by any court of competent
jurisdiction to be invalid and unenforceable to any extent, the remainder of
this Agreement or the application of such provision to such person or
circumstances, other than those as to which it is so determined invalid or
unenforceable, shall not be affected thereby, and each provision hereof shall be
valid and shall be enforced to the fullest extent permitted by law.
12.8 Applicable Law. This Agreement shall be construed under and in
accordance with the laws of state in which the Property is located.
12.9 Counterparts. This Agreement may be executed in two (2) or more
counterparts, each of which shall be an original but such counterparts together
shall constitute one and the same instrument notwithstanding that both Buyer and
Seller are not signatory to the same counterpart.
12.10 Time of the Essence. Time is expressly declared to be of the essence
of this Agreement, provided, however that in the event any date hereunder falls
on a Saturday, Sunday or legal holiday, the date applicable shall be the next
business day.
12.11 No Personal Liability. Neither Buyer nor anyone claiming by, through
or under Buyer shall be entitled to obtain any judgment extending liability
beyond the Property or creating personal liability on the part of the partners
of the Seller or of the officers, directors, shareholders, advisors or agents of
Seller or Seller's partners or any of their successors.
12.12 No Recordation. Without the prior written consent of Seller, there
shall be no recordation of either this Agreement or any memorandum hereof, or
any affidavit pertaining hereto, and any such recordation of this Agreement or
memorandum hereto by Buyer without the prior written consent of Seller shall
constitute a default hereunder by Buyer, whereupon this Agreement shall, at the
option of Seller, terminate and be of no further force and effect. Upon
termination, the Escrowed Amount shall be immediately delivered to Seller,
whereupon the parties shall have no further duties or obligations to one another
except as otherwise specifically provided herein.
12.13 Waiver. The excuse or waiver of the performance by a party of any
obligation of the other party under this Agreement shall only be effective if
evidenced by a written statement signed by the party so excusing or waiving. No
delay in exercising any right or remedy shall constitute a waiver thereof, and
no waiver by Seller or Buyer of the breach of any covenant of this Agreement
shall be construed as a waiver of any preceding or succeeding breach of the same
or any other covenant or condition of this Agreement.
12.14 Binding On Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns.
12.15 Entire Agreement. This Agreement constitutes the entire agreement
between the parties hereto with respect to the transactions contemplated herein,
and it supersedes all prior discussions, understandings or agreements between
the parties. All Exhibits and Schedules attached hereto are a part of this
Agreement and are incorporated herein by reference.
12.16 Construction of Agreement. This Agreement shall not be construed
more strictly against one party than against the other merely by virtue of the
fact that it may have been prepared primarily by counsel for one of the parties,
it being recognized that both Buyer and Seller have contributed substantially
and materially to the preparation of this Agreement.
12.17 Further Instruments. Each party, promptly upon the request of the
other, shall execute and have acknowledged and delivered to the other or to
Escrow Agent, as may be appropriate, any and all further instruments reasonably
requested or appropriate to evidence or give effect to the provisions of this
Agreement and which are consistent with the provisions of this Agreement.
12.18 Buyer Represented by Counsel. Buyer hereby represents and warrants
to Seller that (i) Buyer is not in a significantly disparate bargaining position
in relation to Seller, (ii) Buyer is represented by legal counsel in connection
with the transaction contemplated by this Agreement, and (iii) Buyer is buying
the Property for business, commercial, investment or other similar purpose and
not for use as Buyer's residence.
12.19 Preparation of Documents. All of the documents to be executed at the
Closing shall be in the form prepared to the reasonable satisfaction of Seller's
and Buyer's counsel and delivered to Buyer within five (5) days of the Closing
Date, provided that the failure to timely deliver such documents shall not
constitute a default by Seller hereunder.
12.20 Attorneys Fees. In the event of any litigation arising out of this
Agreement, the prevailing party shall be entitled to reasonable attorneys fees
and costs.
ARTICLE 13
IRS FORM 1099-S DESIGNATION
In order to comply with information reporting requirements of Section
6045(e) of the Internal Revenue Code of 1986, as amended, and the Treasury
Regulations thereunder, the parties agree (1) to execute an IRS Form 1099-S
Designation Agreement in the form attached hereto as Schedule D at or prior to
the Closing to designate the Escrow Agent (the "Designee") as the party who
shall be responsible for reporting the contemplated sale of the Property to the
Internal Revenue Service (the "IRS") on IRS Form 1099-S; (2) to provide the
Designee with the information necessary to complete Form 1099-S; (3) that the
Designee shall not be liable for the actions taken under this Agreement, or for
the consequences of those actions, except as they may be the result of gross
negligence or willful misconduct on the part of the Designee; and (4) that the
Designee shall be indemnified by the parties for any costs or expenses incurred
as a result of the actions taken hereunder, except as they may be the result of
gross negligence or willful misconduct on the part of the Designee. The Designee
shall provide all parties to this transaction with copies of the IRS Forms
1099-S filed with the IRS and with any other documents used to complete IRS Form
1099-S.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first set forth above.
SELLER: ROCKY MOUNTAIN PARTNERS, a Colorado general
partnership
By: PAINE WEBBER GROWTH PROPERTIES LP, a
Delaware limited partnership, a
general partner
By: First PW Growth Properties, Inc., a
Delaware corporation, its managing
general partner
By: /s/ Celia R. Deluga
--------------------
Name: Celia Deluga
Title: Vice President
and
By: REGIS INVESTMENT PARTNERS, LTD., a
California limited partnership, a general
partner
By: Regis Home Advisors Corp., a
California corporation, its general
partner
By: /s/ Geoffrey L. Stack
----------------------
Name: Mr. Geoffrey L. Stack
Title: President
BUYER:
TANTRA LAKE APARTMENTS, L.P., a Delaware limited
partnership
BY: Sares Regis Holdings, LLC., a Delaware
limited liability company, its general
partner
By: /s/ Geoffrey L. Stack
---------------------
Name: Mr. Geoffrey L. Stack
Title: President
<PAGE>
WARRANTY DEED
THIS DEED, dated October 30, 1998
Between ROCKY MOUNTAIN PARTNERS a Colorado general partnership, of County of
Boulder, State of Colorado ("Grantor") and TANTRA LAKE PARTNERS LP, a Delaware
limited partnership whose legal address is 18802 Bardeen Avenue, Irvine
California, 92612 ("Grantee") of the County of Orange, State of California.
WITNESS that the Grantor for valuable consideration the receipt and
sufficiency grants to TANTRA LAKE PARTNERS LP, a Delaware limited partnership
("Grantee") all of its rights, if any, in and to the tailwater in the south fork
of the South Boulder and Bear Creek Ditch and its interest if, any, in all
easement rights if any, or rights of way associated with the delivery and use of
this water together with its rights, if any, in and to all other water and water
rights, rights, whether tributory or non-tributory, storage rights, tap rights,
wells, well rights, reservoirs, reservoir rights, permits, easements, other
rights, claims or demands, appurtenant to that certain real property described
on Exhibit "A" attached hereto and incorporated herein by this reference, if any
which the grantor has therein.
IN WITNESS WHEREOF, Grantor has executed this Warranty Deed as of
October 30, 1998.
"Grantor" ROCKY MOUNTAIN PARTNERSHIP, a
Colorado general partnership
By: Paine Webber Growth Properties LP,
a Delaware corporation, its managing
general partnership
By: First PW Growth Properties, Inc.,
its managing general partner
By: /s/ Celia R. Deluga
-------------------
Its: Vice President
By: Regis Investment Partners, Ltd., a
California limited partnership, a
general partner
By: Regis Home Advisors Corp., a
California corporation, its
general partner
By: /s/ Geoffrey L. Stack
---------------------
Its: President
<PAGE>
DESCRIPTION OF REAL PROPERTY
ALL OF THE TANTRA CONDOMINIUMS, COMPRISING 301 UNITS, TOGETHER WITH THE GENERAL
AND LIMITED COMMON ELEMENTS, ACCORDING TO THE CONDOMINIUM MAP OF THE TANTRA
CONDOMINIUMS RECORDED IN PLAN FILE P-6, F-3 NOS. 27 AND 28 ON JANUARY 17, 1978
ON FILM 993 AS RECEPTION NO. 260968 AND AS DEFINED BY THE DECLARATION OF
COVENANTS, CONDITIONS AND RESTRICTIONS OF THE TANTRA CONDOMINIUMS RECORDED ON
JANUARY 17, 1978 ON FILM 993 AS RECEPTION NO. 260967, BOTH RECORDS IN THE OFFICE
OF THE COUNTY CLERK AND RECORDER BOULDER, COLORADO, COUNTY OF BOULDER, STATE OF
COLORADO.
NOTE FOR INFORMATIONAL PURPOSES: THE TAX IDENTIFICATION NUMBER FOR SUBJECT
PROPERTY IS 14160.
<PAGE>
TANTRA LAKE APARTMENTS
BILL OF SALE AND GENERAL ASSIGNMENT AND ASSUMPTION AGREEMENT
THIS BILL OF SALE AND GENERAL ASSIGNMENT AND ASSUMPTION AGREEMENT (this
Agreement), is made as of the 30th day of October, 1998 by and from ROCKY
MOUNTAIN PARTNERS, a Colorado general partnership, with an address c/o
PaineWebber Properties Incorporated, 265 Franklin Street, 15th Floor, Boston,
Massachusetts 02110 (Assignor), to and for the benefit of TANTRA LAKE PARTNERS,
L.P., a Delaware limited partnership, with an address c/o Sares Regis, 18802
Bardeen Avenue, Irvine, California 92612 ( Assignee).
R E C I T A L S
Pursuant to the terms of a certain Purchase and Sale Agreement dated as of
October 30th, 1998 by and among, Assignor, as seller, and Assignee, as buyer,
Assignee is, by deed of even date, today acquiring from Assignor all of
Assignors interest in, and rights with respect to, the property known as The
Tantra Lake Apartments, being that certain parcel of land, together with the
buildings and other improvements located thereon, located in Boulder, Colorado,
as more particularly described in Exhibit A attached hereto (collectively, the
Property).
NOW THEREFORE, in consideration of such transfer, the conveyance of all of
Assignors interest in, and rights with respect to, the Property by Assignor to
Assignee, and other valuable consideration, the receipt and sufficiency of which
are hereby mutually acknowledged, the parties agree as follows:
A G R E E M E N T
1. Sale of Assigned Property. Assignor hereby sells, transfers, assigns,
delivers, sets-over and conveys to Assignee, its successors and assigns forever,
all of Assignors right, title and interest in and to all personal property owned
by Assignor and installed, located at or otherwise used in connection with the
development, ownership, leasing, financing, improvement, operation or
maintenance of the Property, regardless of where such personal property may be
located, including, without limitation: (i) all tangible personal property
relating to the Property, including, without limitation, the tangible personal
property described on Exhibit B attached hereto, if any, and (ii) all intangible
personal property or other assets relating to the Property and the conduct of
Assignors business thereon, including, without limitation all of Assignors
right, title and interest in all (a) warranties relating to the Property in
Sellers possession, including, without limitation, the warranties listed on
Exhibit C attached hereto, if any, (b) all consents, authorizations, variances,
waivers, licenses, permits, certificates and approvals from any governmental
authority with respect to the Property, (collectively, the Permits), (c) all
logos and trade names currently used in the operation of the Property
(including, without limitation, the right to the name Tantra Lake Apartments,)
and (d) all plans and specifications relating to the Property in Sellers
possession, in each case to the extent that the Assignor may legally transfer
the same (collectively, the Assigned Property).
2. Power and Authority. Assignor represents and warrants to Assignee that it is
fully empowered and authorized to execute and deliver this Agreement, and the
individuals signing this Agreement on behalf of Assignor each represents and
warrants to Assignee that he or she is fully empowered and authorized to do so.
3. As Is. ASSIGNOR MAKES NO WARRANTY OF MERCHANTABILITY OR FITNESS FOR PURPOSE
IN RESPECT OF THE ASSIGNED PROPERTY, AND THE SAME IS SOLD IN AN AS IS, WHERE IS
CONDITION, WITH ALL FAULTS. BY ACCEPTANCE OF DELIVERY ASSIGNEE AFFIRMS THAT
ASSIGNEE HAS INSPECTED THE ASSIGNED PROPERTY AND IS SATISFIED WITH ITS
CONDITION, AND THAT IT HAS NOT RELIED ON ASSIGNORS SKILL OR JUDGMENT TO SELECT
OR FURNISH THE ASSIGNED PROPERTY FOR ANY PARTICULAR PURPOSE, AND THAT ASSIGNOR
MAKES NO WARRANTY THAT THE ASSIGNED PROPERTY IS FIT FOR ANY PARTICULAR PURPOSE
AND THAT THERE ARE NO REPRESENTATIONS AND WARRANTIES, EXPRESSED, IMPLIED, OR
STATUTORY WITH RESPECT THERETO.
4. Assumption. By execution of this Agreement, Assignee hereby accepts the
assignment of the Assigned Property and, subject to the terms of this Agreement,
assumes and agrees to perform all of Assignors obligations as owner of the
Property under the Assigned Property, if any, first arising after the date
hereof.
5. Counterparts. This Agreement may be executed in any number of counterparts
and it shall be sufficient that the signature of each party appear on one or
more such counterparts. All counterparts shall collectively constitute a single
agreement.
6. Governing Law. This Agreement shall be governed by the laws of the State of
Colorado and shall be binding upon and inure to the benefit of Assignor and
Assignee and their respective successors and assigns.
<PAGE>
IN WITNESS WHEREOF, Assignor and Assignee have executed and delivered this
Agreement the day and year first above written.
ASSIGNOR: ROCKY MOUNTAIN PARTNERS, a Colorado
general partnership
By: PaineWebber Growth Properties L.P.,
a Delaware limited partnership, a
general partner
By: First PW Growth Properties,
Inc., a Delaware corporation,
its managing general partner
By: /s/ Celia R. Deluga
-------------------
Name: Celia Deluga
Title: Vice President
By: Regis Investment Partners, LTD., a
California corporation, a general
partner
By: Regis Home Advisors Corp., a
California corporation, its
general partner
By: /s/ Geoffrey L. Stack
---------------------
Name: Geoffrey L. Stack
Title: President
ASSIGNEE: TANTRA LAKE PARTNERS, L.P.,
a Delaware limited partnership
By: Sares Regis Holdings, LLC, a
Delaware limited liability company,
its general partner
By: /s/ Geoffrey L. Stack
---------------------
Name: Geoffrey L. Stack
Title: President
<PAGE>
TANTRA LAKE APARTMENTS
ASSIGNMENT AND ASSUMPTION
OF LEASES AND SECURITY DEPOSITS
THIS ASSIGNMENT AND ASSUMPTION OF LEASES AND SECURITY DEPOSITS (this
Agreement) is entered into as of the 30th of October, 1998, between ROCKY
MOUNTAIN PARTNERS, a Colorado general partnership (Assignor), with an address
c/o PaineWebber Properties Incorporated, 265 Franklin Street, 15th Floor,
Boston, Massachusetts 02110 (Assignor), to and for the benefit of TANTRA LAKE
PARTNERS, L.P., a Delaware limited partnership, with an address c/o Sares Regis,
18802 Bardeen Avenue, Irvine, California 92612 (Assignee).
1. Property. The Property means the real property located in Boulder,
Colorado, commonly known as The Tantra Lake Apartments, as more particularly
described on Exhibit A attached hereto and incorporated herein by reference,
together with the buildings, structures and other improvements located thereon.
2. Leases. The Leases means those leases, tenancies, rental agreements and
occupancy agreements affecting the Property which are described on the Rent Roll
attached to this Agreement as Exhibit B.
3. Security Deposits. Security Deposits means those security deposits held
by or for Assignor on account of tenants under the Leases as such deposits and
with respect to which Assignee shall receive a credit at the closing of the
transaction with respect to which this Agreement has been executed and
delivered. The Security Deposits are set forth on the Rent Roll attached to this
Agreement as Exhibit B.
4. Assignment. For good and valuable consideration received by Assignor,
the receipt and sufficiency of which are hereby acknowledged, Assignor hereby
grants, transfers and assigns to Assignee the entire right, title and interest
of Assignor in and to the Leases and the Security Deposits.
5. Assumption. Assignee hereby assumes the covenants, agreements and
obligations of Assignor as landlord or lessor under the Leases and Assignee
further assumes all liability of Assignor for the proper refund or return of the
Security Deposits if, when and as required by the Leases.
6. Power and Authority. Assignor represents and warrants to Assignee that
it is fully empowered and authorized to execute and deliver this Assignment, and
the individual signing this Assignment on behalf of Assignor represents and
warrants to Assignee that he or she is fully empowered and authorized to do so.
7. Attorneys Fees. If either Assignee or Assignor, or their respective
successors or assigns, file suit to enforce the obligations of the other party
under this Agreement, the prevailing party shall be entitled to recover the
reasonable fees and expenses of its attorneys.
8. Intentionally Deleted.
9. Successors and Assigns. This Agreement shall be binding upon and inure
to the benefit of Assignor and Assignee and their respective successors and
assigns.
10. Counterparts. This Agreement may be executed in multiple counterparts,
any or all of which may contain the signatures of fewer than all of the parties,
but all of which shall constitute a single instrument.
11. Governing Law. This Agreement shall be governed by the laws of the
State of Colorado and shall be binding upon and inure to the benefit of Assignor
and Assignee and their respective successors and assigns.
DOCUMENT CONTINUES ON NEXT PAGE
<PAGE>
IN WITNESS WHEREOF, Assignor and Assignee have executed and delivered this
Assignment the day and year first above written.
ASSIGNOR: ROCKY MOUNTAIN PARTNERS, a
Colorado general partnership
By: PaineWebber Growth Properties L.P., a
Delaware limited partnership, a general
partner
By: First PW Growth Properties, Inc., a
Delaware corporation, its managing
general partner
By: /s/ Celia R. Deluga
-------------------
Name: Celia Deluga
Title: Vice President
By: Regis Investment Partners, LTD., a
California corporation, a general partner
By: Regis Home Advisors Corp., a
California corporation, its general
partner
By: /s/ Geoffrey L. Stack
---------------------
Name: Geoffrey L. Stack
Title: President
SIGNATURES CONTINUE ON NEXT PAGE
<PAGE>
ASSIGNEE: TANTRA LAKE PARTNERS, L.P., a
Delaware limited partnership
By: Sares Regis Holdings, LLC, a Delaware
limited liability company
By: /s/ Geoffrey L. Stack
----------------------
Name: Geoffrey L. Stack
Title: President
REST OF PAGE INTENTIONALLY LEFT BLANK
<PAGE>
FINAL CLOSING STATEMENT
SELLER(s): Rocky Mountain Partners
BUYER(s): Tantra Lake Partners, L.P.
PROPERTY: 1000 West Moorhead Circle, Boulder, CO
$ Debits $ Credits
-------- ---------
Financial:
Total Consideration $23,200,000.00
Prorations/Adjustments:
Unpaid County/Personal Property
Taxes at $119,174.00 Annually
from 01/01/98 to 10/29/98
($119,174 div by 365x302 days) $98,603.00
Security Deposits $112,126.00
Prorated Rents 10/28/98 to 10/31/98 $15,608.00
Pet Fees & Month-to-Month Fees (71/73) $144.00
Balance of Prepaid Rents $8,194.00
Stove Pipe Credit $8,000.00
Prepaid GreenPlan Landscaping $406.00
Balance of Delinquent Rents $3,433.00
TITLE CHARGES:
ALTA Owner's Policy - (1970)
for 23,200,000.00 $22,302.00
ESCROW CHARGES:
Escrow Fees $2,709.00
Wire Fee $150.00
UPS/Fed Exp/Mess.,Est. $50.00
PAYOFFS - WMF Group
Total Payoff $8,995,185.00
Principal Balance $8,850,000.00
Interest to 10/30/98 $56,640.00
Prepayment Penalty $88,500.00
WMF Fax Fee $30.00
Statement Fee $15.00
MISCELLANEOUS CHARGES:
Orkin Pest Control $3,000.00
ESTIMATED NET PROCEEDS DUE SELLER:
Seller's proceeds to be
distributed as follows: $13,937,768.00
Growth Fund 1 (PW) ($12,761,445.00)
Regis Investment Partners ($853,766.00)
Balance of Seller's Proceeds to
Tantra Lake Partners, L.P. ($322,557.00)
ESTIMATED TOTALS $23,203,839.00 $23,203,839.00
<PAGE>
ROCKY MOUNTAIN PARTNERS,
a Colorado general partnership
By: PaineWebber Growth Properties LP,
a Delaware limited partnership, a
general partner
By: First PW Growth Properties, Inc.,
a Delaware corporation, its
managing general partner
By: /s/ Celia R. Deluga
--------------------
Celia Deluga, Vice President
By: Regis Investment Partners, Ltd.,
a California limited partnership,
a general partner
By: Regis Home Advisors Corp., a
California corporation, its
general partner
By: /s/ Geoffrey L. Stack
---------------------
Its: President
<PAGE>
PURCHASE AND SALE AGREEMENT
BY AND BETWEEN
GROUSE RUN ASSOCIATES I AND GROUSE RUN ASSOCIATES II
(COLLECTIVELY "SELLER")
AND
GROUSE RUN PARTNERS, L.P. ("BUYER")
THE GROUSE RUN APARTMENTS, PHASE I AND PHASE II
4738-4804 GROUSE RUN DRIVE
STOCKTON, CALIFORNIA
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE 1.....................................................................1
DEFINITIONS.............................................................1
ARTICLE 2.....................................................................4
PURCHASE AND SALE.......................................................4
ARTICLE 3.....................................................................4
PURCHASE PRICE; DEPOSIT; ADJUSTMENTS....................................4
ARTICLE 4.....................................................................7
PRECLOSING OPERATION....................................................7
ARTICLE 5.....................................................................7
INTENTIONALLY OMITTED...................................................7
ARTICLE 6.....................................................................7
TITLE AND SURVEY........................................................7
ARTICLE 7.....................................................................9
CONDITIONS PRECEDENT AND CLOSING........................................9
ARTICLE 8....................................................................12
CASUALTY AND CONDEMNATION..............................................12
ARTICLE 9....................................................................13
INTENTIONALLY OMITTED..................................................13
ARTICLE 10...................................................................13
DEFAULT, TERMINATION AND REMEDIES......................................13
ARTICLE 11...................................................................15
REPRESENTATIONS AND WARRANTIES.........................................15
ARTICLE 12...................................................................19
MISCELLANEOUS..........................................................19
ARTICLE 13...................................................................23
IRS FORM 1099-S DESIGNATION............................................23
LIST OF EXHIBITS
EXHIBIT A - THE LAND
EXHIBIT B - PERSONAL PROPERTY
EXHIBIT C - PROPERTY CONTRACTS
EXHIBIT D - EARNEST MONEY ESCROW INSTRUCTIONS
EXHIBIT E - RENT ROLL
EXHIBIT F - FORM OF ESCROW CLOSING INSTRUCTIONS
EXHIBIT G - DOCUMENTS
LEAD-BASED PAINT DISCLOSURE
<PAGE>
PURCHASE AND SALE AGREEMENT
Grouse Run Apartments, Phases I and II
THIS PURCHASE AND SALE AGREEMENT (this "Agreement") is entered into as of
the 16th day of October, 1998 by and between Seller and Buyer, upon the
following terms and conditions:
WHEREAS, Seller desires to sell and Buyer desires to purchase, the
Property (hereinafter defined) on the terms and conditions hereinafter set
forth;
NOW THEREFORE, in consideration of the mutual undertakings, covenants and
agreements contained herein, and other good and valuable consideration the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
agree as follows:
ARTICLE 1
DEFINITIONS
References in this Agreement to the following terms shall have the
following meanings:
Buyer: Grouse Run Partners, L.P., a Delaware limited
- ----- partnership
Closing Date: See Section 7.3
- ------------
Deposit: See Section 3.1
- -------
Documents: Those materials listed on Exhibit D attached hereto.
- ---------
Environmental
Requirements: All laws, ordinances, statutes, codes, rules,
- ------------ regulations, agreements, judgments, orders and decrees
now or hereafter enacted, promulgated, or amended, of
the United States, the states, the counties, the
cities or any other political subdivisions in which
the Real Property is located and any other political
subdivision, agency or instrumentality exercising
jurisdiction over the owner of the Real Property, the
Real Property or the use of the Real Property relating
to pollution, the protection or regulation of human
health, natural resources or the environment, or the
emission, discharge, release or threatened release of
pollutants, contaminants, chemicals or industrial,
toxic or hazardous substances or waste or Hazardous
Materials into the environment (including, without
limitation, ambient air, surface water, ground water
or land or soil).
Escrowed Amount: See Section 3.1
- ---------------
Hazardous Substances: Any substance which is or contains: (i) any
- -------------------- "hazardous substance" as now or hereafter defined in
Section 101(14) of the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as
amended (42 U.S.C. Section 9601 et seq.) or any
regulations promulgated under CERCLA; (ii) any
"hazardous waste" as now or hereafter defined in the
Resource Conservation and Recovery Act (42 U.S.C.
Section 6901 et seq.) or regulations promulgated under
RCRA; (iii) any substance regulated by the Toxic
Substances Control Act (15 U.S.C. Section 2601
et. seq.); (iv) gasoline, diesel fuel or other
petroleum hydrocarbons; (v) asbestos and asbestos
containing materials, in any form, whether friable or
nonfriable; (vi) polychlorinated biphenyls;
(vii) radon gas; and (viii) any additional substances
or materials which are now or hereafter classified or
considered to be hazardous or toxic under
Environmental Requirements or the common law, or any
other applicable law related to the Property.
Hazardous Materials shall include, without limitation,
any substance, the presence of which on the Real
Property: (A) requires reporting, investigation or
remediation under Environmental Requirements;
(B) causes or threatens to cause a nuisance on the Real
Property or adjacent property or poses or threatens to
pose a hazard to the health or safety of persons on
the Real Property or adjacent property; or (C) if
emanated or migrated from the Real Property, could
constitute a trespass.
Improvements: All buildings, structures and other improvements
- ----------- situated upon the Land and all fixtures, systems and
facilities owned by Seller (hereinafter defined) and
located on the Land.
Intangible Property: All of Seller's right, title and interest, if
- ------------------- any, in all intangible assets of any nature relating
to the Land, the Improvements or the Personal
Property, including, without limitation, all of
Seller's right, title and interest in all
(i) warranties and guaranties relating to the
Improvements or Personal Property in the possession of
Seller, (ii) all licenses, permits and approvals
relating to the Real Property, (iii) all logos and
trade names currently used by Seller exclusively in
the operation of the Land and Improvements, including
the use of the name "Grouse Run Apartments," and
(iv) all plans and specifications, in each case to the
extent that Seller may legally transfer the same.
Land: All of the land described on Exhibit A attached
- ---- hereto, together with all privileges, rights,
easements, and appurtenances belonging to such land
and all right, title and interest (if any) of Seller
in and to any streets, alleys, passages, and other
rights-of-way or appurtenances included in, adjacent
to or used in connection with such land and all right,
title and interest (if any) of Seller in all mineral
and development rights appurtenant to such land.
Leases: All of Seller's rights in all leases and other
- ------ occupancy agreements covering any portion of the Land
or Improvements.
Personal Property: All furniture, carpeting, appliances, equipment,
- ----------------- machinery, inventories, supplies, signs and other
tangible personal property of every kind and nature,
if any, owned by Seller and installed, located at and
used in connection with the ownership, occupation and
operation of the Real Property. Personal Property
specifically excludes: (i) any items of personal
property owned by tenants at or on the Real Property,
and (ii) any items of personal property owned by third
parties and leased to Seller.
Property: The Real Property, the Personal Property, the Leases,
- ----------- the Tenant Deposits, the Intangible Property and the
Property Contracts known as Grouse Run Apartments,
Phase I and Phase II, located at 4738-4804 Grouse Run
Drive, Stockton, California.
Property: Contracts: All of Seller's rights, if any, in all
- -------- service, supply and equipment rental, management,
operating and leasing contracts affecting the Property,
to the extent that (i) Seller is entitled to transfer
the same to Buyer, and (ii) Buyer does not elect to have
Seller terminate them in accordance with Section 4.3
below.
Purchase Price: $5,800,000
- --------------
PW: PaineWebber Growth Properties LP, a Delaware limited
- -- partnership
Real Property: The Land and the Improvements.
- --------------
Seller: Grouse Run Associates I, a California general
- ------ partnership and Grouse Run Associates II, a general
partnership, collectively.
Tenant Deposits: Seller's rights to unapplied security deposits under
- --------------- the Leases.
Title Company: Fidelity National Title Insurance Company
- -------------
ARTICLE 2
PURCHASE AND SALE
2.1 Seller agrees to sell and convey the Property to Buyer and Buyer
hereby agrees to buy the Property from Seller for the Purchase Price and
otherwise subject to the covenants, provisions, terms and conditions contained
herein.
ARTICLE 3
PURCHASE PRICE; DEPOSIT; ADJUSTMENTS
3.1 Deposit. Contemporaneously with the execution and delivery of this
Agreement (and as a condition precedent to the effectiveness of this Agreement),
Buyer shall deposit immediately available funds with the Title Company
(hereinafter the "Escrow Agent") the sum of One Hundred Fifty Thousand and
No/100 Dollars ($150,000.00) (the "Deposit") to secure Buyer's obligations under
this Agreement. The Escrow Agent shall hold the Deposit in a segregated interest
bearing money market account with an FDIC insured bank reasonably acceptable to
Buyer and Seller. The Deposit and all interest accrued on the Deposit
(collectively, the "Escrowed Amount") shall be maintained by the Escrow Agent in
such account or accounts until the Escrow Agent is required to cause the
Escrowed Amount to be disbursed pursuant to the terms and conditions of this
Agreement and the Earnest Money Escrow Instructions attached hereto as Exhibit
B. The Escrowed Amount shall be applied to the Purchase Price if the Closing
occurs, as provided in Section 3.2 below.
3.2 Purchase Price. The Purchase Price, subject to adjustment as provided
herein, shall be as specified in Article 1 above and shall be paid on the
Closing Date (as hereinafter defined) in United States dollars by wire transfer
of federal funds, less the Escrowed Amount (the "Cash Balance").
3.3 Tax Proration. All due and payable real estate taxes, all general and
special assessments on the Land and ad valorem taxes, if any, on the Personal
Property (based on the most recent ascertainable taxes) attributable to the
Property through the Closing Date shall be prorated and adjusted as of the
Closing Date. 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
contemplated herein or from any improvements made or leases entered into on or
after the Closing Date. If the tax statements for the fiscal year during which
the Closing Date occurs are not finally determined, then the tax figures for the
immediately prior fiscal year shall be used for the purposes of prorating taxes
on the Closing Date, provided that there shall be no further adjustment to be
made after the Closing Date. Any tax refunds or proceeds (including interest
thereon) on account of a favorable determination resulting from a challenge,
protest, appeal or similar proceeding relating to taxes and assessments relating
to the Property (i) for all tax periods occurring prior to the applicable tax
period in which the Closing occurs shall be retained by and paid exclusively to
Seller and (ii) for the applicable tax period in which the Closing occurs shall
be prorated as of the Closing Date after reimbursement to Seller and Buyer, as
applicable, for all fees, costs and expenses (including reasonable attorneys'
and consultants' fees) incurred by Seller or Buyer, as applicable, in connection
with such proceedings such that Seller shall retain and be paid that portion of
such tax refunds or proceeds as is applicable to the portion of the applicable
tax period prior to the Closing Date and Buyer shall retain and be paid that
portion of such tax refunds or proceeds as is applicable to the portion of the
applicable tax period from and after the Closing Date. Neither Seller nor Buyer
shall settle any tax protests or proceedings in which taxes for the tax period
for which the other party is responsible are being adjudicated without the
consent of such party, which consent shall not be unreasonably withheld,
conditioned or delayed. After the Closing, Buyer shall be responsible for and
control any tax protests or proceedings for any period for which taxes are
adjusted between the parties under this Agreement and for any later period.
Buyer and Seller shall cooperate in pursuit of any such proceedings and in
responding to reasonable requests of the other for information concerning the
status of and otherwise relating to such proceedings; provided, however, that
neither party shall be obligated to incur any out-of-pocket fees, costs or
expenses in responding to the requests of the other.
3.4 Contract Proration. To the extent Property Contracts are not
terminated pursuant to Section 4.3, prepaid or past due amounts under any
Property Contracts which are assigned to Buyer at Closing shall be prorated and
adjusted as of the Closing Date.
3.5 Utility Proration. To the extent reasonably feasible, the Seller shall
cause all meters for electricity, gas, water, sewer or other public utility
usage at the Property to be read as of the day immediately preceding the Closing
Date, and the Seller shall pay all charges for such utilities which have accrued
on or prior to the Closing Date; provided, however, that if and to the extent
such charges are paid directly by tenants, no such reading or payment shall be
required. If the utility companies are unable or refuse to read meters for which
payment by the Seller is required, all charges for such utilities to the extent
unpaid shall be prorated and adjusted as of the Closing Date based on the most
recent bills therefor and no further adjustment shall be made. The Seller shall
provide notice to the Buyer within five (5) days of the Closing Date setting
forth (i) whether utility meters will be read as of the Closing Date and (ii) a
copy of the most recent bill for any utility charges which are to be prorated
and adjusted as of the Closing Date.
3.6 Income and Expense Proration. Collected rents for the then current and
any future period, security deposits which have not been previously applied by
Seller, prepaid rentals, and all expenses and other charges in connection with
the operation of the Property shall be apportioned and full value shall be
adjusted as of the Closing Date, and the net amount thereof, if in favor of
Seller, shall be added to the Purchase Price, or if in favor of Buyer, shall be
deducted from the Purchase Price. From and after Closing all security deposits
credited to Buyer shall thereafter be deemed transferred to Buyer and Buyer
shall assume and be solely responsible for the payments of security deposits to
tenants in accordance with the Leases and applicable law. Seller shall be
entitled to retain or if transferred to Buyer receive a credit for any utility
deposits and any deposits for third parties under any of the Property Contracts.
In addition to the foregoing, at Closing the Purchase Price shall be increased
by the amount of uncollected or past due rent; provided, however, that no
adjustment shall be made for rent which is more than two (2) months past due.
Seller shall be entitled to attempt to collect all rents and other charges which
are more than two (2) months past due but shall not be entitled to pursue
eviction proceedings in connection with such collection efforts.
3.7 Prorations Generally. A statement of prorations and other adjustments
shall be prepared by Seller in conformity with the provisions of this Article 3
and submitted to Buyer for review and approval not less than five (5) business
days prior to the Closing Date. For purposes of making prorations, Seller shall
be deemed to be in title to the Property and entitled to the income from and
responsible for the expenses thereof, on the Closing Date.
3.8 Closing Costs.
(a) Seller shall pay: (i) its legal fees and expenses related to the
negotiation and preparation of this Agreement and all documents required
to close the transaction contemplated hereby, (ii) 50% of the escrow fees
of the Escrow Agent, (iii) 50% of the costs associated with title
examination and preparation of a title commitment, as well as 50% of the
charge and premiums for a CLTA (1990) owner's title insurance policy, and
(iv) all applicable state, county or other taxes associated with the
transfer of the Property.
(b) Buyer shall pay: (i) 50% of the escrow fees of the Escrow Agent,
(ii) charges to record the deed, and evidence of Buyer's existence or
authority, (iii) Buyer's legal fees and expenses related to the
negotiation of this Agreement and all documents required to close the
transaction contemplated hereby, (iv) 50% of the costs associated with
title examination and preparation of a title commitment as well as 50% of
the charges and premiums for a CLTA (1990) owner's title insurance policy,
(v) all costs allocable to preparation of a new survey or an update to the
existing survey, if any.
(c) All other closing costs shall be paid by Seller or Buyer in
accordance with the custom in the jurisdiction where the Property is
located.
ARTICLE 4
PRECLOSING OPERATION
4.1 Leases. A rent roll (the "Rent Roll") containing a list of all
occupants of the Property pursuant to the Leases as of the date hereof is
attached hereto as Exhibit E. During the pendency of this Agreement, Seller may
enter into Leases with new tenants or modifications of Leases with existing
tenants substantially in accordance with Seller's existing leasing practices,
provided that in all events any new or modified Leases shall (i) be at or near
market rent, (ii) be for a term of not more than one (1) year (with respect to
residential Leases only), and (iii) on the Seller's current standard form of
lease. From the date hereof through the Closing, Seller shall not apply security
deposits to delinquent rents under the Leases other than in the ordinary course
of business.
4.2 Conduct of Business. At all times prior to Closing, Seller shall
continue (a) to conduct business with respect to the Property in the same manner
in which said business has been heretofore conducted, (b) to insure the Property
substantially as currently insured, and (c) maintain the Property in its current
condition, reasonable wear and tear and damage by casualty excepted, including
ordinary preparation for occupancy of residential units vacated prior to
Closing.
4.3 Property Contracts. Buyer shall provide written notice to Seller of
the Property Contracts that Buyer desires to have terminated by Seller not less
than ten (10) days prior to the Closing Date, and Seller will terminate the
Property Contracts so identified at or before Closing, provided that such
Property Contracts may be terminated without cost or liability to Seller and if
there is cost or liability to Seller, Buyer shall be responsible for any such
liability. At Closing, Seller shall assign and Buyer shall assume the Property
Contracts, except those Property Contracts which Seller has agreed to terminate.
ARTICLE 5
INTENTIONALLY OMITTED
ARTICLE 6
TITLE AND SURVEY
6.1 Subsequently Arising Exceptions. In the event that any encumbrance,
lien or other title matter to which Buyer objects, other than (i) those matters
listed in Section 6.2 below and (ii) any matters created voluntarily or
involuntarily created or assumed by Buyer and not voluntarily created or assumed
by PW, first arises following the date hereof, Buyer shall have the right to
object to any such encumbrance, lien or other title matter by providing written
notice thereof to PW at or prior to the Closing or by providing oral or written
notice thereof if such encumbrance, lien or other title matter is discovered in
connection with the final title rundown at the Closing (any and all such
encumbrances, liens and other title matters specified in such notice are
hereinafter collectively referred to as "Subsequently Arising Exceptions"). If
Buyer fails to give such notice to PW at or prior to the Closing, all
encumbrances, liens or other title matters existing with respect to the Property
which are in existence as of such date shall thereafter be conclusively deemed
satisfactory to Buyer in all respects and Buyer shall be conclusively deemed to
have waived all objections thereto. If Buyer gives timely notice to PW of any
Subsequently Arising Exception, PW agrees to use reasonable efforts to cure the
same (provided, however, that PW shall not be obligated to incur any costs or
expenses in excess of ($10,000) (the "Cure Amount") in connection with any such
cure undertaken by PW. Seller shall, however, be obligated on or before Closing
to pay or discharge any and all liens or encumbrances that constitute a lien on
the Property for the purpose of securing a monetary obligation of Seller that PW
consented to.
6.2 Deed. On the Closing Date, Seller shall convey title to the Property
by good and sufficient grant deed (the "Deed") to Buyer fee simple title to all
of the Real Property free and clear of all liens, encumbrances, conditions,
easements, assessments, restrictions and other conditions, except for the
following:
(a) All Leases;
(b) All zoning, building and other laws applicable to the Property;
(c) All matters which arise after the date hereof which are agreed
upon or consented to by Buyer;
(d) The lien, if any, for real estate taxes for the current year not
due and payable prior to the Closing Date (subject to proration in
accordance with Section 3.3 herein);
(e) All matters of public record as of the effective date and shown
on the title commitment listed on Exhibit G (the "Title Commitment");
(f) Those exceptions or title deficiencies which (i) Buyer does not
object to pursuant to Section 6.1, or (ii) are waived by Buyer because
Seller is unwilling or unable to cure (the "Permitted Exceptions");
(g) Any matters shown on the Survey or any updated survey prepared
by or for the benefit of Buyer; and
(h) All matters, whether or not of record, to the extent caused by
Buyer or its agents, representatives or contractors.
6.3 Lease Assignment. At the Closing, Seller shall assign the Leases to
Buyer and Buyer shall assume Seller's obligations thereunder and Seller shall
convey the Personal Property to Buyer by quitclaim bill of sale.
ARTICLE 7
CONDITIONS PRECEDENT AND CLOSING
7.1 Buyer's Conditions Precedent. In addition to any other conditions
precedent in favor of Buyer as may be set forth elsewhere in this Agreement,
Buyer's obligations under this Agreement are expressly subject to the timely
fulfillment of the conditions set forth in this Section 7.1 on or before the
Closing Date, or such earlier date as is set forth below. Each condition may be
waived in whole or in part only by written notice of such waiver from Buyer to
Seller.
(a) Seller performing and complying in all material respects with
all of the terms of this Agreement to be performed and complied with by
Seller prior to or at the Closing.
(b) On the Closing Date, all of the representations of Seller set
forth in this Agreement shall continue to be true, accurate and complete.
(c) Buyer shall have received evidence that Apartment Renovation
Group has released any claims it may have against Buyer or Seller arising
out of that certain Purchase and Sale Agreement by and between PW and The
Apartment Renovation Group with respect to the Property.
Notwithstanding the foregoing, if the conditions set forth in this Section
7.1 or any other condition of Closing (other than an obligation of Buyer under
Section 7.2 below) shall not have been fulfilled on or before the Closing Date,
Seller and Buyer may mutually agree to extend the Closing Date for a period of
up to thirty (30) days to provide additional time for the fulfillment of such
conditions. Upon any such extension, the term "Closing Date" as used herein
shall mean the date set forth in such written notice from Seller.
7.2 Seller's Conditions Precedent. In addition to any other conditions
precedent in favor of Seller as may be set forth elsewhere in this Agreement,
Seller's obligations under this Agreement are expressly subject to the timely
fulfillment of the conditions set forth in this Section 7.2 on or before the
Closing Date, or such earlier date as is set forth below. Each condition may be
waived in whole or part only by written notice of such waiver from Seller to
Buyer.
(a) Buyer performing and complying in all material respects with all
of the terms of this Agreement to be performed and complied with by Buyer
prior to or at the Closing, including, without limitation, payment by the
Buyer of the Purchase Price (as adjusted as otherwise provided herein);
and
(b) On the Closing Date, all of the representations of Buyer set
forth in this Agreement shall continue to be true, accurate and complete.
7.3 Closing Date. Subject to Seller's right to extend the Closing Date as
provided in Section 7.1, the consummation of the purchase and sale contemplated
in this Agreement (the "Closing") shall occur through an escrow closing
arrangement as described in Schedule F attached hereto on November 6, 1998 (the
"Closing Date"), at the office of the Escrow Agent or through the escrow closing
arrangements set forth in the Form of Escrow Closing Instructions attached
hereto as Exhibit F. Buyer may accelerate the Closing Date by providing Seller
with three business days prior notice.
7.4 Closing Deliveries. On the Closing Date, Seller shall deliver or cause
to be delivered in each case, in a form reasonably acceptable to Buyer and
Seller:
(a) A duly executed and acknowledged Deed or Deeds conveying the
Land and the Improvements to Buyer;
(b) A duly executed quitclaim bill of sale and general assignment
conveying the Personal Property and the Intangible Property to Buyer;
(c) A duly executed assignment and assumption of the Leases and
Tenant Deposits (the "Assignment of Leases");
(d) A duly executed assignment and assumption of Property Contracts
being assumed (the "Assignment of Contracts");
(e) A certificate or certificates of non-foreign status from Seller;
(f) Customary affidavits sufficient for the Escrow Agent to delete
any exceptions for mechanic's or materialmen's liens and parties in
possession from Buyer's title policy and such other affidavits relating to
such title policy as the Escrow Agent may reasonably request;
(g) An updated rent roll (including a list of all delinquent and
prepaid rents) certified by the Seller as true and correct as of the
Closing Date;
(h) Such other instruments as Buyer or the Escrow Agent may
reasonably request to effectuate the transactions contemplated by this
Agreement;
(i) A duly executed counterpart original of the closing statement
setting forth the Purchase Price, the closing adjustments and the
application of the Escrowed Amount as adjusted;
(j) Evidence or documents as may reasonably be required by the
Escrow Agent evidencing the status and capacity of Seller to sell the
Property and the authority of the person or persons executing the various
documents on behalf of Seller in connection with the sale of the Property;
(k) Originals, or where unavailable, copies of all Property
Contracts, Leases (with all amendments and modifications thereto),
operating information, permits, warranties and financial information about
the Property in Seller's possession or control relating to the Property;
(l) All keys to all locks on the Property and similar items, to the
extent in Seller's possession; and
(m) A certificate executed by Seller certifying that the
representations and warranties of Seller contained in Section 11.2 herein are
true and correct as of the Date of Closing.
7.5 Buyer's Deliveries. On the Closing Date, Buyer shall deliver or cause
to be delivered at its expense each of the following to Seller:
(a) The Purchase Price for the Property, as such Purchase Price may
have been adjusted pursuant to the provisions of this Agreement and
credited for any portion of the Escrowed Amount paid to Seller, in the
manner provided for in Article 3;
(b) Evidence in form and substance reasonably satisfactory to Escrow
Agent and Seller of Buyer's authority to purchase the Property;
(c) The Assignment of Leases;
(d) The Assignment of Contracts;
(e) Such other instruments as Seller or Escrow Agent may reasonably
request to effectuate the transactions contemplated by this Agreement;
(f) A duly executed counterpart original of the closing statement
setting forth the Purchase Price, the closing adjustments and the
application of such amounts;
(g) Such evidence or documents as may reasonably be required by the
Escrow Agent evidencing the status and capacity of Buyer and the authority
of the person or persons who are executing the various documents on behalf
of Buyer in connection with the purchase of the Property;
(h) Acknowledgment by Buyer of Buyer's receipt (or constructive
receipt) from Seller of the Tenant Deposits;
(i) Executed counterparts of any other documents listed in Section
7.4 required to be signed by Buyer; and
(j) A certificate executed by Buyer certifying that the
representations and warranties of Buyer contained in Section 11.1 herein are
true and correct as of the Date of Closing.
7.6 Possession. Possession of the Property shall be delivered to Buyer by
Seller at the Closing, subject only to those items listed in Section 6.2 of this
Agreement and rights arising under any Property Contracts not terminated by
Seller pursuant to Section 4.3. Seller and Buyer covenant and agree to execute,
at Closing, a written notice of the acquisition of the Property by Buyer, for
duplication and transmittal to all tenants affected by the sale and purchase of
the Property (or otherwise in such manner as will comply with applicable law
respecting notification of tenants). Such notice shall be prepared by Buyer and
approved by Seller, shall notify the tenants of the sale and transfer and shall
contain appropriate instructions relating to the payment of future rentals, the
giving of future notices, and other matters reasonably required by Buyer or
required by law. Unless a different procedure is required by applicable law, in
which event such laws shall be controlling, Buyer agrees to transmit or
otherwise deliver such letters to the tenants promptly after the Closing.
ARTICLE 8
CASUALTY AND CONDEMNATION
8.1 Casualty. If the Improvements are damaged by fire or any other
casualty and are not substantially restored to the condition immediately prior
to such casualty before the Closing Date, Buyer shall have the following
elections:
(a) to purchase the Property in its then condition and pay the
Purchase Price, in which event Seller shall pay over or assign to Buyer as
the case may be, on the Closing Date, amounts recovered or recoverable by
Seller on account of any insurance as a result of such casualty up to the
amount of the Purchase Price, less any amounts reasonably expended by
Seller for partial restoration; or
(b) if any portion of the Improvements suffers damage in excess of
$500,000 from fire or any other casualty which Seller, in its sole option,
elects not to repair, to terminate this Agreement by giving notice of
termination to Seller on or before that date which is thirty (30) days
after the occurrence of the fire or other casualty or on the Closing Date,
whichever occurs first, in which event the Escrow Agent shall return the
Escrowed Amount to Buyer, this Agreement shall terminate and neither
Seller nor Buyer shall have any recourse against the other (except to the
extent such recourse arises in connection with a provision of this
Agreement which is intended to survive termination).
8.2 Condemnation. If any substantial portion of or interest in the
Property (which, for purposes of this Section 8.2 shall be deemed to include all
or any portion of the means of access to the Property, any parking spaces at the
Property or any units at the Property) shall be taken or is in the process of
being taken by exercise of the power of eminent domain or if any governmental
authority notifies Seller prior to the Closing Date of its intent to take or
acquire any portion of or interest in the Property (each an "Eminent Domain
Taking"), Seller shall give notice promptly to Buyer of such event and Buyer
shall have the option to terminate this Agreement by providing notice to Seller
to such effect on or before the date which is ten (10) days from Seller's notice
to Buyer of such Eminent Domain Taking or on the Closing Date, whichever occurs
first, in which event the Escrow Agent shall return the Escrowed Amount to
Buyer, this Agreement shall terminate, and neither Seller nor Buyer shall have
any recourse against the other (except to the extent such recourse arises in
connection with a provision of this Agreement which is intended to survive
termination). If Buyer does not timely notify Seller of its election to
terminate this Agreement, Buyer shall purchase the Property and pay the Purchase
Price, and Seller shall pay over or assign to Buyer on delivery of the Deed
awards recovered or recoverable by Seller on account of such Eminent Domain
Taking up to the amount of the Purchase Price, less any amounts reasonably
expended by Seller in obtaining such award.
ARTICLE 9
INTENTIONALLY OMITTED
ARTICLE 10
DEFAULT, TERMINATION AND REMEDIES
10.1 Seller's Default. In the event that Seller defaults in its obligation
to close hereunder, Buyer shall have the right to (i) terminate this Agreement
and receive the Escrowed Amount, whereupon this Agreement shall terminate
without further recourse or, (ii) take any and all legal actions necessary to
compel the Seller's specific performance hereunder (it being acknowledged that
damages at law would be an inadequate remedy), and to consummate the transaction
contemplated by this Agreement in accordance with the provisions of this
Agreement (such conveyance shall be deemed as satisfied and waive any other
remedy). Buyer hereby waives and relinquishes any other right to sue Seller for
any reason whatsoever, and agrees that Seller shall not be liable to Buyer for
any actual, punitive, speculative, consequential or other damages for breach by
Seller prior to the Closing, except for return of the Escrowed Amount. IN NO
EVENT SHALL SELLER, ITS DIRECT OR INDIRECT PARTNERS, SHAREHOLDERS, OWNERS OR
AFFILIATES, ANY OFFICER, DIRECTOR, EMPLOYEE OR AGENT OF THE FOREGOING, OR ANY
AFFILIATE OR CONTROLLING PERSON THEREOF, HAVE ANY LIABILITY BEYOND ITS INTEREST
IN THE PROPERTY FOR ANY CLAIM, CAUSE OF ACTION OR OTHER LIABILITY ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR THE PROPERTY, WHETHER BASED ON COMMON LAW,
CONTRACT, STATUTE, EQUITY OR OTHERWISE.
10.2 Buyer's Default. In the event that Buyer defaults in its obligation
to close hereunder, PW shall be entitled to receive the Escrowed Amount as
liquidated damages, in lieu of all other remedies available to PW at law or in
equity for such default (but subject to the final two (2) sentences of this
Section 10.2), and Buyer shall direct the Escrow Agent to release the Escrowed
Amount to PW. PW and Buyer agree that the damages resulting to PW as a result of
such default by Buyer as of the date of this Agreement are difficult or
impossible to ascertain and the liquidated damages set forth in the preceding
sentence constitute Buyer's and PW's reasonable estimate of such damages.
Notwithstanding the foregoing, in the event of Buyer's default or a termination
of this Agreement, PW shall have all remedies available at law or in equity in
the event Buyer or any party related to or affiliated with Buyer asserts any
claims or rights to the Property that would otherwise delay or prevent Seller
from having clear, indefeasible and marketable title to the Property. In
addition to the foregoing remedies, in accordance with Section 7.05(d) of the
Seller's partnership agreement (the "LP Agreement"), in the event Buyer defaults
in its obligations hereunder, PW, acting singly on behalf of Seller, may at any
time for a period of 120 days after such default cause Seller to sell the
Property to any person at a price and on terms no less favorable to the Seller
than those applicable to Buyer hereunder. Seller acknowledges that the Escrowed
Amount made hereunder is in lieu of the twenty percent deposit required pursuant
to Seller's LP Agreement and that should Buyer default in its obligations
hereunder, Seller's sole remedy (except as otherwise set forth in this Section
10.2) shall be to retain the Escrowed Amount and Seller shall have no claim or
right to payment of twenty percent deposit set forth in Seller's LP Agreement.
ARTICLE 11
REPRESENTATIONS AND WARRANTIES
11.1 Buyer's Representations and Warranties. Buyer represents and warrants
to Seller that:
(a) Buyer is a California limited partnership, duly organized and in
good standing under the laws of the State of California, is qualified to
do business in the State of California and has the power and authority to
enter into this Agreement and to execute and deliver this Agreement and to
perform all duties and obligations imposed upon it hereunder. As of the
date of this Agreement, Buyer has obtained all necessary corporate,
partnership or other organizational authorizations required in connection
with the execution and delivery of this Agreement. Each of the individuals
executing this Agreement on Buyer's behalf is authorized to do so. Buyer
has the financial ability to pay the Purchase Price by (i) tendering the
Cash Balance, and performing the other covenants of Buyer set forth in
this Agreement.
(b) Neither the execution nor the delivery of this Agreement, nor
the consummation of the purchase and sale transaction contemplated hereby,
nor the fulfillment of or compliance with the terms and conditions of this
Agreement conflict with or will result in the breach of any of the terms,
conditions or provisions of any agreement or instrument to which Buyer is
a party or by which Buyer or any of Buyer's assets is bound;
(c) No approval, consent, order or authorization of, or designation,
registration or declaration with, any of the United States, the State of
California, any department, board, agency, office, commission or other
subdivisions thereof, or any official thereof or any third party is
required in connection with the valid execution and delivery of, and
performance of the covenants of, this Agreement by Buyer.
(d) There are no actions, suits or proceedings pending or, to the
knowledge of Buyer, threatened, against or affecting Buyer which, if
determined adversely to Buyer, would adversely affect its ability to
perform its obligations hereunder.
Prior to the Closing Date, Buyer shall notify Seller in writing of any
facts, conditions or circumstances which render any of the representations and
warranties set forth in this Section 11.1 in any way inaccurate, incomplete,
incorrect or misleading.
11.2 Seller's Representations and Warranties. Seller represents and
warrants to Buyer that:
(a) Seller is a general partnership existing under the laws of the
State of California.
(b) Neither the execution nor the delivery of this Agreement, nor
the consummation of the purchase and sale transaction contemplated hereby,
nor the fulfillment of or compliance with the terms and conditions of this
Agreement conflict with or will result in the breach of any of the terms,
conditions or provisions of any agreement or instrument to which Seller or
PaineWebber Growth Properties LP is a party or by which Seller or any of
Seller's assets is bound.
(c) Seller has full right, power and authority and is duly
authorized to enter into this Agreement, and by the Closing Date shall
have the authority to perform each of the covenants on its part to be
performed hereunder and to execute and deliver, and to perform its
obligations under all documents required to be executed and delivered by
it pursuant to this Agreement and this Agreement constitutes the valid and
binding obligation of Seller enforceable in accordance with its terms.
(d) To Seller's knowledge, Seller's property manager at the Property
has delivered or will deliver or has made available or will make available
to Buyer (i) complete copies of all Leases and (ii) the Rent Roll.
(e) Seller has caused the property manager at the Property to
deliver or to make available copies of all Property Contracts.
(f) To Seller's knowledge, Seller has not been served with written
notice of any actions, suits, or proceedings against or affecting the
Seller or the Property that either (i) are not covered by applicable
insurance or (ii) if determined adversely to Seller would materially
affect the ownership or operation of the Property or Seller's ability to
perform its obligations under this Agreement.
Prior to the Closing Date, Seller shall notify Buyer in writing of any
facts, conditions or circumstances which render any of the representations and
warranties set forth in this Section 11.2 in any way inaccurate, incomplete,
incorrect or misleading. Notwithstanding the foregoing, all of Seller's
representations and warranties shall be deemed to be updated by information
disclosed to or obtained by Purchaser in connection with its due diligence
investigations.
11.3 Seller; Seller's Knowledge. Whenever a representation is made to
"Seller's knowledge", or a term of similar import, the accuracy of such
representation shall be based solely on the actual knowledge of Celia Deluga,
without independent investigation or inquiry except for inquiry of the property
manager for the Property. Notwithstanding the foregoing, if, prior to the
Closing, Buyer obtains actual knowledge that any representation or warranty of
Seller is inaccurate and Buyer nonetheless proceeds with the Closing, Seller
shall have no liability for any such matter regarding which Buyer had actual
knowledge prior to Closing.
11.4 Property Conveyed "AS IS". (a) NOTWITHSTANDING ANYTHING CONTAINED
HEREIN TO THE CONTRARY, IT IS UNDERSTOOD AND AGREED THAT, EXCEPT AS EXPRESSLY
SET FORTH HEREIN, SELLER AND THEIR PROPERTY MANAGER HAVE NOT MADE AND ARE NOT
NOW MAKING, AND THEY SPECIFICALLY DISCLAIM, ANY OTHER WARRANTIES,
REPRESENTATIONS OR GUARANTIES OF ANY KIND OR CHARACTER, EXPRESS OR IMPLIED, ORAL
OR WRITTEN, PAST, PRESENT OR FUTURE, WITH RESPECT TO THE PROPERTY, INCLUDING,
BUT NOT LIMITED TO, WARRANTIES, REPRESENTATIONS OR GUARANTIES AS TO (I) MATTERS
OF TITLE (OTHER THAN SELLER'S WARRANTY OF TITLE SET FORTH IN THE DEED
(HEREINAFTER DEFINED) TO BE DELIVERED AT CLOSING), (II) ENVIRONMENTAL MATTERS
RELATING TO THE PROPERTY OR ANY PORTION THEREOF, (III) GEOLOGICAL CONDITIONS,
INCLUDING, WITHOUT LIMITATION, SUBSIDENCE, SUBSURFACE CONDITIONS, WATER TABLE,
UNDERGROUND WATER RESERVOIRS, LIMITATIONS REGARDING THE WITHDRAWAL OF WATER, AND
EARTHQUAKE FAULTS AND THE RESULTING DAMAGE OF PAST AND/OR FUTURE EARTHQUAKES,
(IV) WHETHER, AND THE EXTENT TO WHICH THE PROPERTY OR ANY PORTION THEREOF IS
AFFECTED BY ANY STREAM (SURFACE OR UNDERGROUND), BODY OF WATER, FLOOD PRONE
AREA, FLOOD PLAIN, FLOODWAY OR SPECIAL FLOOD HAZARD, (V) DRAINAGE, (VI) SOIL
CONDITIONS, INCLUDING THE EXISTENCE OF INSTABILITY, PAST SOIL REPAIRS, SOIL
ADDITIONS OR CONDITIONS OF SOIL FILL, OR SUSCEPTIBILITY TO LANDSLIDES, OR THE
SUFFICIENCY OF ANY UNDERSHORING, (VII) ZONING TO WHICH THE PROPERTY OR ANY
PORTION THEREOF MAY BE SUBJECT, (VIII) THE AVAILABILITY OF ANY UTILITIES TO THE
PROPERTY OR ANY PORTION THEREOF INCLUDING, WITHOUT LIMITATION, WATER, SEWAGE,
GAS AND ELECTRIC, (IX) USAGES OF ADJOINING PROPERTY, (X) ACCESS TO THE PROPERTY
OR ANY PORTION THEREOF, (XI) THE VALUE, COMPLIANCE WITH THE PLANS AND
SPECIFICATIONS, SIZE, LOCATION, AGE, USE, DESIGN, QUALITY, DESCRIPTION,
SUITABILITY, STRUCTURAL INTEGRITY, OPERATION, TITLE TO, OR PHYSICAL OR FINANCIAL
CONDITION OF THE PROPERTY OR ANY PORTION THEREOF, OR ANY INCOME, EXPENSES,
CHARGES, LIENS, ENCUMBRANCES, RIGHTS OR CLAIMS ON OR AFFECTING OR PERTAINING TO
THE PROPERTY OR ANY PART THEREOF, OR ANY CHARGES, LIENS, ENCUMBRANCES, RIGHTS OR
CLAIMS ON OR AFFECTING OR PERTAINING TO THE PROPERTY OR ANY PART THEREOF, (XII)
THE PRESENCE OF HAZARDOUS SUBSTANCES (HEREINAFTER DEFINED) IN OR ON, UNDER OR IN
THE VICINITY OF THE PROPERTY, (XIII) THE CONDITION OR USE OF THE PROPERTY OR
COMPLIANCE OF THE PROPERTY WITH ANY OR ALL PAST, PRESENT OR FUTURE FEDERAL,
STATE OR LOCAL ORDINANCES, RULES, REGULATIONS OR LAWS, BUILDING, FIRE OR ZONING
ORDINANCES, CODES OR OTHER SIMILAR LAWS, (XIV) THE EXISTENCE OR NON-EXISTENCE OF
UNDERGROUND STORAGE TANKS, (XV) ANY OTHER MATTER AFFECTING THE STABILITY OR
INTEGRITY OF THE REAL PROPERTY, (XVI) THE POTENTIAL FOR FURTHER DEVELOPMENT OF
THE PROPERTY, (XVII) THE EXISTENCE OF VESTED LAND USE, ZONING OR BUILDING
ENTITLEMENTS AFFECTING THE PROPERTY, (XVIII) THE MERCHANTABILITY OF THE PROPERTY
OR FITNESS OF THAT PROPERTY FOR ANY PARTICULAR PURPOSE (BUYER AFFIRMING THAT
BUYER HAS NOT RELIED ON SELLER'S OR ITS PROPERTY MANAGER'S SKILL OR JUDGMENT TO
SELECT OR FURNISH THE PROPERTY FOR ANY PARTICULAR PURPOSE, AND THAT SELLER MAKES
NO WARRANTY THAT THE PROPERTY IS FIT FOR ANY PARTICULAR PURPOSE), OR (XIX) TAX
CONSEQUENCES.
(b) BUYER HAS NOT RELIED UPON AND WILL NOT RELY UPON, EITHER
DIRECTLY OR INDIRECTLY, ANY REPRESENTATION OR WARRANTY OF SELLER OR ITS PROPERTY
MANAGER OR ANY OF THEIR RESPECTIVE AGENTS, EXPECT AS EXPRESSLY SET FORTH HEREIN,
AND ACKNOWLEDGES THAT NO OTHER SUCH REPRESENTATIONS HAVE BEEN MADE. BUYER
REPRESENTS THAT IT IS A KNOWLEDGEABLE, EXPERIENCED AND SOPHISTICATED BUYER OF
REAL ESTATE AND THAT IT IS RELYING SOLELY ON ITS OWN EXPERTISE AND THAT OF
BUYER'S CONSULTANTS IN PURCHASING THE PROPERTY. BUYER WILL CONDUCT SUCH
INSPECTIONS AND INVESTIGATIONS OF THE PROPERTY AS BUYER DEEMS NECESSARY,
INCLUDING, BUT NOT LIMITED TO, THE PHYSICAL AND ENVIRONMENTAL CONDITIONS
THEREOF, AND SHALL RELY UPON SAME. UPON CLOSING, BUYER SHALL ASSUME THE RISK
THAT ADVERSE MATTERS, INCLUDING, BUT NOT LIMITED TO, ADVERSE PHYSICAL AND
ENVIRONMENTAL CONDITIONS, MAY NOT HAVE BEEN REVEALED BY BUYER'S INSPECTIONS AND
INVESTIGATIONS. BUYER ACKNOWLEDGES AND AGREES THAT UPON CLOSING, SELLER SHALL
SELL AND CONVEY TO BUYER AND BUYER SHALL ACCEPT THE PROPERTY "AS IS, WHERE IS",
WITH ALL FAULTS. BUYER FURTHER ACKNOWLEDGES AND AGREES THAT THERE ARE NO ORAL
AGREEMENTS, WARRANTIES OR REPRESENTATIONS, COLLATERAL TO OR AFFECTING THE
PROPERTY BY SELLER, ANY AGENT OF SELLER OR ANY THIRD PARTY. THE TERMS AND
CONDITIONS OF THIS SECTION 11.4(B) SHALL EXPRESSLY SURVIVE THE CLOSING, SHALL
NOT MERGE WITH THE PROVISIONS OF ANY CLOSING DOCUMENTS. SELLER IS NOT LIABLE OR
BOUND IN ANY MANNER BY ANY ORAL OR WRITTEN STATEMENTS, REPRESENTATIONS, OR
INFORMATION PERTAINING TO THE PROPERTY FURNISHED BY ANY REAL ESTATE BROKER,
AGENT, EMPLOYEE, SERVANT OR OTHER PERSON, UNLESS THE SAME ARE SPECIFICALLY SET
FORTH OR REFERRED TO HEREIN. BUYER ACKNOWLEDGES THAT THE PURCHASE PRICE REFLECTS
THE "AS IS" NATURE OF THIS SALE AND ANY FAULTS, LIABILITIES, DEFECTS OR OTHER
ADVERSE MATTERS THAT MAY BE ASSOCIATED WITH THE PROPERTY. BUYER HAS FULLY
REVIEWED THE DISCLAIMERS AND WAIVERS SET FORTH IN THIS AGREEMENT WITH ITS
COUNSEL AND UNDERSTANDS THE SIGNIFICANCE AND EFFECT THEREOF.
--------------
Buyer's Initials
ARTICLE 12
MISCELLANEOUS
12.1 Successors and Assigns. Without the prior written consent of Seller,
Buyer shall not, directly or indirectly, assign this Agreement or any of its
rights hereunder. Any attempted assignment in violation hereof shall, at the
election of Seller in its sole discretion, be of no force or effect and shall
constitute a default by Buyer. Notwithstanding the foregoing and so long as it
will not affect the timing of the Closing Buyer may elect to have a nominee
entity accept title to the Property at Closing, provided that any such nominee
must be an affiliated entity controlled by or under common control with Buyer,
and Buyer shall give written notice of such nominee to Seller, together with any
reasonable evidence of affiliation requested by Seller, a minimum of fifteen
(15) days prior to Closing. No designation of a nominee to receive title shall
release Buyer from its obligations under this Agreement.
12.2 Notices. Except as otherwise specifically provided herein, any notice
required or permitted to be delivered under this Agreement shall be in writing
and shall be deemed given (i) when delivered or refused if sent by hand during
regular business hours, (ii) three (3) days after being sent by United States
Postal Service, registered or certified mail, postage prepaid, return receipt
requested, (iii) on the next business day when sent by a reputable overnight
express mail service that provides tracing and proof of receipt or refusal of
items mailed, addressed to Seller or Buyer, as the case may be, at the address
or addresses set forth below or such other addresses as the parties may
designate in a notice similarly sent, or (iv) on the day of receipt if such day
is a business day when sent by facsimile, otherwise on the next business day
after receipt, as evidenced by a facsimile confirmation receipt. Any notice
given by a party to Escrow Agent shall be simultaneously given to the other
party. Any notice given by a party to the other party relating to its
entitlement to the Escrowed Amount shall be simultaneously given to the Escrow
Agent.
(1) If to Seller:
c/o Paine Webber Properties Incorporated
265 Franklin Street - 15 Floor
Boston, MA 02110
Attn: Ms. Celia Deluga
Fax: (617) 345-8752
with a copy to:
Goodwin, Procter & Hoar LLP
Exchange Place
Boston, MA 02109
Attn: Andrew C. Sucoff, Esq.
Fax: (617) 227-8591
(2) If to Buyer:
Sares Regis
18802 Bardeen Avenue
Irvine, California 92612
Attn: Geoffrey L. Stack and Bill Thormahlen
Fax: (949) 756-5955
with a copy to:
Pinto & Dubia LLP
2 Park Plaza, Suite 300
Irvine, CA 92614-8513
Attn: Kenneth Ryder, Esq.
Fax: (949) 833-2067
and a copy to:
Morgan, Lewis & Bockius
300 S. Grand Avenue, 22nd Floor
Los Angeles, CA 90071-3132
Attn: William Ellis, Esq.
Fax: (213) 612-2554
and a copy to:
Citibank-GREIO
153 East 53rd Street
56th Floor, Zone 7
New York, NY 10043
Attn: Tim Donahoe
Fax: (212) 793-2091
(3) If to the Escrow Agent:
Fidelity National Title Insurance Company
12.3 Construction. Words of any gender used in this Agreement shall be
held and construed to include any other gender, and words of a singular number
shall be held to include the plural and vice versa, unless the context requires
otherwise.
12.4 Captions. The captions used in connection with the Articles of this
Agreement are for convenience only and shall not be deemed to extend, limit or
otherwise define or construe the meaning of the language of this Agreement.
12.5 No Other Parties. Nothing in this Agreement, express or implied, is
intended to confer upon any person, other than the parties hereto and their
respective successors and assigns, any rights or remedies under or by reason of
this Agreement.
12.6 Amendments. This Agreement may be amended only by a written
instrument executed by Seller and Buyer (or Buyer's assignee or transferee).
12.7 Severability. If any provision of this Agreement or application to
any party or circumstance shall be determined by any court of competent
jurisdiction to be invalid and unenforceable to any extent, the remainder of
this Agreement or the application of such provision to such person or
circumstances, other than those as to which it is so determined invalid or
unenforceable, shall not be affected thereby, and each provision hereof shall be
valid and shall be enforced to the fullest extent permitted by law.
12.8 Applicable Law. This Agreement shall be construed under and in
accordance with the laws of state in which the Property is located.
12.9 Counterparts. This Agreement may be executed in two (2) or more
counterparts, each of which shall be an original but such counterparts together
shall constitute one and the same instrument notwithstanding that both Buyer and
Seller are not signatory to the same counterpart.
12.10 Time of the Essence. Time is expressly declared to be of the essence
of this Agreement, provided, however that in the event any date hereunder falls
on a Saturday, Sunday or legal holiday, the date applicable shall be the next
business day.
12.11 Joint and Several; No Personal Liability. The obligations of Seller
hereunder are joint and several. Neither Buyer nor anyone claiming by, through
or under Buyer shall be entitled to obtain any judgment extending liability
beyond the Property or creating personal liability on the part of the partners
of Seller or of the officers, directors, shareholders, advisors or agents of
Seller or Seller's partners or any of their successors.
12.12 No Recordation. Without the prior written consent of Seller, there
shall be no recordation of either this Agreement or any memorandum hereof, or
any affidavit pertaining hereto, and any such recordation of this Agreement or
memorandum hereto by Buyer without the prior written consent of Seller shall
constitute a default hereunder by Buyer, whereupon this Agreement shall, at the
option of Seller, terminate and be of no further force and effect. Upon such
termination, the Escrowed Amount shall be immediately delivered to Seller,
whereupon the parties shall have no further duties or obligations to one another
except as otherwise specifically provided herein.
12.13 Waiver. The excuse or waiver of the performance by a party of any
obligation of the other party under this Agreement shall only be effective if
evidenced by a written statement signed by the party so excusing or waiving. No
delay in exercising any right or remedy shall constitute a waiver thereof, and
no waiver by Seller or Buyer of the breach of any covenant of this Agreement
shall be construed as a waiver of any preceding or succeeding breach of the same
or any other covenant or condition of this Agreement.
12.14 Binding On Successors and Assigns. This Agreement shall be binding
upon and inure to the benefit of the parties hereto and their respective
successors and assigns.
12.15 Entire Agreement. This Agreement constitutes the entire agreement
between the parties hereto with respect to the transactions contemplated herein,
and it supersedes all prior discussions, understandings or agreements between
the parties. All Exhibits and Schedules attached hereto are a part of this
Agreement and are incorporated herein by reference.
12.16 Construction of Agreement. This Agreement shall not be construed
more strictly against one party than against the other merely by virtue of the
fact that it may have been prepared primarily by counsel for one of the parties,
it being recognized that both Buyer and Seller have contributed substantially
and materially to the preparation of this Agreement.
12.17 Further Instruments. Each party, promptly upon the request of the
other, shall execute and have acknowledged and delivered to the other or to
Escrow Agent, as may be appropriate, any and all further instruments reasonably
requested or appropriate to evidence or give effect to the provisions of this
Agreement and which are consistent with the provisions of this Agreement.
12.18 Buyer Represented by Counsel. Buyer hereby represents and warrants
to Seller that (i) Buyer is not in a significantly disparate bargaining position
in relation to Seller, (ii) Buyer is represented by legal counsel in connection
with the transaction contemplated by this Agreement, and (iii) Buyer is buying
the Property for business, commercial, investment or other similar purpose and
not for use as Buyer's residence.
12.19 Preparation of Documents. All of the documents to be executed at the
Closing shall be in the form prepared to the reasonable satisfaction of Seller's
and Buyer's counsel and delivered to Buyer on or before five (5) days prior to
the Closing Date, provided that the failure to timely deliver such documents
shall not constitute a default by Seller hereunder.
12.20 Attorneys' Fees. In the event of any litigation arising out of this
Agreement, the prevailing party shall be entitled to reasonable attorneys' fees
and costs.
ARTICLE 13
IRS FORM 1099-S DESIGNATION
In order to comply with information reporting requirements of Section
6045(e) of the Internal Revenue Code of 1986, as amended, and the Treasury
Regulations thereunder, the parties agree (1) to execute an IRS Form 1099-S
Designation Agreement in the form attached hereto as Schedule D at or prior to
the Closing to designate the Escrow Agent (the "Designee") as the party who
shall be responsible for reporting the contemplated sale of the Property to the
Internal Revenue Service (the "IRS") on IRS Form 1099-S; (2) to provide the
Designee with the information necessary to complete Form 1099-S; (3) that the
Designee shall not be liable for the actions taken under this Agreement, or for
the consequences of those actions, except as they may be the result of gross
negligence or willful misconduct on the part of the Designee; and (4) that the
Designee shall be indemnified by the parties for any costs or expenses incurred
as a result of the actions taken hereunder, except as they may be the result of
gross negligence or willful misconduct on the part of the Designee. The Designee
shall provide all parties to this transaction with copies of the IRS Forms
1099-S filed with the IRS and with any other documents used to complete IRS Form
1099-S.
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day
and year first set forth above.
Seller: GROUSE RUN ASSOCIATES I, a California
general partnership
By: PaineWebber Growth Properties, L.P., a
Delaware limited partnership, a general
partner
By: First PW Growth Properties, Inc., a
Delaware corporation, its general
partner
By: /s/ Celia R. Deluga
-------------------
Name: Celia Deluga
Title: Vice President
and
By: Regis Investment Partners, Ltd., a
California limited partnership, a general
partner
By: Regis Homes Advisors Corp., a
California corporation, its general
partner
By: /s/ Geoffrey L. Stack
---------------------
Name: Geoffrey L. Stack
Title: President
<PAGE>
GROUSE RUN ASSOCIATES II, a California general
partnership
By: PaineWebber Growth Properties, L.P., a
Delaware limited partnership, a general
partner
By: First PW Growth Properties, Inc., a
Delaware corporation, its general
partner
By: /s/ Celia R. Deluga
-------------------
Name: Celia Deluga
Title: Vice President
and
By: Regis Investment Partners, Ltd., a
California limited partnership, a general
partner
By: Regis Homes Advisors Corp., a
California corporation, its general
partner
By: /s/ Geoffrey L. Stack
---------------------
Name: Geoffrey L. Stack
Title: President
BUYER:
GROUSE RUN PARTNERS, L.P., a Delaware limited
partnership
BY: Sares Regis Holdings, LLC, a Delaware
limited liability company, its general
partner
By: /s/ Geoffrey L. Stack
---------------------
Name: Geoffrey L. Stack
Title: President
<PAGE>
RECORDING REQUESTED BY
WHEN RECORDED MAIL TO
AND MAIL TAX STATEMENTS TO
NAME Grouse Run Partners, L.P.
c/o Sares Regis
ADDRESS 18802 Bardeen Avenue
CITY Irvine
STATE & ZIP California, 92612
- --------------------------------------------------------------------------------
APN Numbers: 108-300-06 and 108-300-07
GRANT DEED
IN ACCORDANCE WITH SECTION 11932 OF THE CALIFORNIA REVENUE AND TAXATION CODE,
GRANTOR HAS DECLARED THE AMOUNT OF THE TRANSFER TAX WHICH IS DUE BY SEPARATE
STATEMENT WHICH IS NOT BEING RECORDED WITH THIS GRANT DEED.
FOR A VALUABLE CONSIDERATION, receipt of which is hereby acknowledged,
Grouse Run Associates I and Grouse Run Associates II, each a California
general partnership hereby GRANT to:
Grouse Run Partners, L.P., a Delaware limited partnership certain real
property located in the City of Stockton, County of San Joaquin, State of
California as more particularly described in Exhibit A attached hereto, subject
to and having the benefit of matters of record to the extent in effect.
Dated: October 30, 1998 Grouse Run Associates I
-----------------
By: PaineWebber Growth Properties,
L.P., a Delaware limited
partnership, a general partner
By: First PW Growth
Properties, Inc., a
Delaware corporation,
its general partner
By: /s/ Celia R. Deluga
---------------------
Name: Celia Deluga
Title: Vice President
By: Regis Investment Partners,
Ltd., a California limited
partnership, a general partner
By: Regis Home Advisors
Corp., a California
corporation, its general
partner
By: /s/ Geoffrey L. Stack
---------------------
Name: Geoffrey L. Stack
Title: President
Grouse Run Associates II
By: PaineWebber Growth Properties,
L.P., a Delaware limited
partnership, a general partner
By: First PW Growth
Properties, Inc., a
Delaware corporation,
its general partner
By: /s/ Celia R. Deluga
------------------
Name: Celia R. Deluga
Title: Vice President
By: Regis Investment Partners,
Ltd., a California limited
partnership, a general partner
By: Regis Home Advisors
Corp., a California
corporation, its
general partner
By: /s/ Geoffrey L. Stack
--------------------
Name: Geoffrey L. Stack
Title: President
REST OF PAGE INTENTIONALLY LEFT BLANK
<PAGE>
GROUSE RUN APARTMENTS
BILL OF SALE AND GENERAL ASSIGNMENT AND ASSUMPTION AGREEMENT
THIS BILL OF SALE AND GENERAL ASSIGNMENT AND ASSUMPTION AGREEMENT (this
Agreement), is made as of the 2nd day of November, 1998 by and from GROUSE RUN
ASSOCIATES I and GROUSE RUN ASSOCIATES II, each a California general partnership
with an address c/o PaineWebber Properties Incorporated, 265 Franklin Street,
15th Floor, Boston, Massachusetts 02110 (collectively, Assignor), to and for the
benefit of GROUSE RUN PARTNERS, L.P., a Delaware limited partnership with an
address c/o Sares Regis, 18802 Bardeen Avenue, Irvine, California 92612 (
Assignee).
R E C I T A L S
Pursuant to the terms of a certain Purchase and Sale Agreement dated as of
October 16, 1998 by and among, Assignor, as seller, and Assignee, as buyer,
Assignee is, by deed of even date, today acquiring from Assignor all of
Assignors interest in, and rights with respect to, the property known as The
Grouse Run Apartments, being those certain parcels of land, together with the
buildings and other improvements located thereon, located in Stockton,
California, as more particularly described in Exhibit A attached hereto
(collectively, the Property).
NOW THEREFORE, in consideration of such transfer, the conveyance of all of
Assignors interest in, and rights with respect to, the Property by Assignor to
Assignee, and other valuable consideration, the receipt and sufficiency of which
are hereby mutually acknowledged, the parties agree as follows:
A G R E E M E N T
1. Sale of Assigned Property. Assignor hereby sells, transfers, assigns,
delivers, sets-over and conveys to Assignee, its successors and assigns forever,
all of Assignors right, title and interest in and to all personal property owned
by Assignor and installed, located at or otherwise used in connection with the
development, ownership, leasing, financing, improvement, operation or
maintenance of the Property, regardless of where such personal property may be
located, including, without limitation: (i) all tangible personal property
relating to the Property, including, without limitation, the tangible personal
property described on Exhibit B attached hereto, if any, and (ii) all intangible
personal property or other assets relating to the Property and the conduct of
Assignors business thereon, including, without limitation all of Assignors
right, title and interest in all (a) warranties relating to the Property in
Sellers possession, including, without limitation, the warranties listed on
Exhibit C attached hereto, if any, (b) all consents, authorizations, variances,
waivers, licenses, permits, certificates and approvals from any governmental
authority with respect to the Property, (collectively, the Permits), (c) all
logos and trade names currently used in the operation of the Property
(including, without limitation, the right to the name Grouse Run Apartments,)
and (d) all plans and specifications relating to the Property in Sellers
possession, in each case to the extent that the Assignor may legally transfer
the same (collectively, the Assigned Property).
2. Power and Authority. Assignor represents and warrants to Assignee that it is
fully empowered and authorized to execute and deliver this Agreement, and the
individuals signing this Agreement on behalf of Assignor each represents and
warrants to Assignee that he or she is fully empowered and authorized to do so.
3. As Is. ASSIGNOR MAKES NO WARRANTY OF MERCHANTABILITY OR FITNESS FOR PURPOSE
IN RESPECT OF THE ASSIGNED PROPERTY, AND THE SAME IS SOLD IN AN AS IS, WHERE IS
CONDITION, WITH ALL FAULTS. BY ACCEPTANCE OF DELIVERY ASSIGNEE AFFIRMS THAT
ASSIGNEE HAS INSPECTED THE ASSIGNED PROPERTY AND IS SATISFIED WITH ITS
CONDITION, AND THAT IT HAS NOT RELIED ON ASSIGNORS SKILL OR JUDGMENT TO SELECT
OR FURNISH THE ASSIGNED PROPERTY FOR ANY PARTICULAR PURPOSE, AND THAT ASSIGNOR
MAKES NO WARRANTY THAT THE ASSIGNED PROPERTY IS FIT FOR ANY PARTICULAR PURPOSE
AND THAT THERE ARE NO REPRESENTATIONS AND WARRANTIES, EXPRESSED, IMPLIED, OR
STATUTORY WITH RESPECT THERETO.
4. Assumption. By execution of this Agreement, Assignee hereby accepts the
assignment of the Assigned Property and, subject to the terms of this Agreement,
assumes and agrees to perform all of Assignors obligations as owner of the
Property under the Assigned Property, if any, first arising after the date
hereof.
5. Counterparts. This Agreement may be executed in any number of counterparts
and it shall be sufficient that the signature of each party appear on one or
more such counterparts. All counterparts shall collectively constitute a single
agreement.
6. Governing Law. This Agreement shall be governed by the laws of the State of
California and shall be binding upon and inure to the benefit of Assignor and
Assignee and their respective successors and assigns.
<PAGE>
IN WITNESS WHEREOF, Assignor and Assignee have executed and delivered this
Agreement the day and year first above written.
ASSIGNOR: GROUSE RUN ASSOCIATES I, a California
general partnership
By: PaineWebber Growth Properties L.P.,
a Delaware limited partnership, a
general partner
By: First PW Growth Properties,
Inc., a Delaware corporation,
its managing general partner
By: /s/ Celia R. Deluga
-------------------
Name: Celia Deluga
Title: Vice President
By: Regis Investment Partners, LTD., a
California corporation, a general
partner
By: Regis Home Advisors Corp., a
California corporation, its
general partner
By: /s/ Geoffrey L. Stack
---------------------
Name: Geoffrey L. Stack
Title: President
<PAGE>
GROUSE RUN ASSOCIATES II, a California general partnership
By: PaineWebber Growth Properties L.P., a
Delaware limited partnership, a general
partner
By: First PW Growth Properties, Inc., a
Delaware corporation, its managing
general partner
By: /s/ Celia Deluga
----------------
Name: Celia Deluga
Title: Vice President
By: Regis Investment Partners, LTD., a
California corporation, a general
partner
By: Regis Home Advisors Corp., a
California corporation, its
general partner
By: /s/ Geoffrey L. Stack
---------------------
Name: Geoffrey L. Stack
Title: President
ASSIGNEE: GROUSE RUN PARTNERS, L.P., a Delaware
limited partnership
By: Sares Regis Holdings, LC, a
Delaware limited liability company,
its general partner
By: /s/ Geoffrey L. Stack
---------------------
Name: Geoffrey L. Stack
Title: President
<PAGE>
GROUSE RUN APARTMENTS
ASSIGNMENT AND ASSUMPTION
OF LEASES AND SECURITY DEPOSITS
THIS ASSIGNMENT AND ASSUMPTION OF LEASES AND SECURITY DEPOSITS (this
Agreement) is entered into as of the 2nd of November 1998, between GROUSE RUN
PARTNERS I and GROUSE RUN PARTNERS II, each a California general partnership
with an address c/o PaineWebber Properties Incorporated, 265 Franklin Street,
15th Floor, Boston, Massachusetts 02110 (collectively, Assignor), to and for the
benefit of GROUSE RUN PARTNERS, L.P., a Delaware limited partnership, with an
address c/o Sares Regis, 18802 Bardeen Avenue, Irvine, California 92612
(Assignee).
1. Property. The Property means the real property located in Stockton,
California commonly known as The Grouse Run Apartments, as more particularly
described on Exhibit A attached hereto and incorporated herein by reference,
together with the buildings, structures and other improvements located thereon.
2. Leases. The Leases means those leases, tenancies, rental agreements and
occupancy agreements affecting the Property which are described on the Rent Roll
attached to this Agreement as Exhibit B.
3. Security Deposits. Security Deposits means those security deposits held
by or for Assignor on account of tenants under the Leases as such deposits and
with respect to which Assignee shall receive a credit at the closing of the
transaction with respect to which this Agreement has been executed and
delivered. The Security Deposits are set forth on the Rent Roll attached to this
Agreement as Exhibit B.
4. Assignment. For good and valuable consideration received by Assignor,
the receipt and sufficiency of which are hereby acknowledged, Assignor hereby
grants, transfers and assigns to Assignee the entire right, title and interest
of Assignor in and to the Leases and the Security Deposits.
5. Assumption. Assignee hereby assumes the covenants, agreements and
obligations of Assignor as landlord or lessor under the Leases and Assignee
further assumes all liability of Assignor for the proper refund or return of the
Security Deposits if, when and as required by the Leases.
6. Power and Authority. Assignor represents and warrants to Assignee that
it is fully empowered and authorized to execute and deliver this Assignment, and
the individual signing this Assignment on behalf of Assignor represents and
warrants to Assignee that he or she is fully empowered and authorized to do so.
7. Attorneys Fees. If either Assignee or Assignor, or their respective
successors or assigns, file suit to enforce the obligations of the other party
under this Agreement, the prevailing party shall be entitled to recover the
reasonable fees and expenses of its attorneys.
8. Successors and Assigns. This Agreement shall be binding upon and inure
to the benefit of Assignor and Assignee and their respective successors and
assigns.
9. Counterparts. This Agreement may be executed in multiple counterparts,
any or all of which may contain the signatures of fewer than all of the parties,
but all of which shall constitute a single instrument.
10. Governing Law. This Agreement shall be governed by the laws of the
State of California and shall be binding upon and inure to the benefit of
Assignor and Assignee and their respective successors and assigns.
DOCUMENT CONTINUES ON NEXT PAGE
<PAGE>
IN WITNESS WHEREOF, Assignor and Assignee have executed and delivered this
Assignment the day and year first above written.
ASSIGNOR: GROUSE RUN ASSOCIATES I, a California general
partnership
By: PaineWebber Growth Properties L.P., a
Delaware limited partnership, a general
partner
By: First PW Growth Properties, Inc., a
Delaware corporation, its managing
general partner
By: /s/ Celia R. Deluga
-------------------
Name: Celia Deluga
Title: Vice President
By: Regis Investment Partners, LTD., a
California limited partnership, a general
partner
By: Regis Home Advisors Corp., a
California corporation, its general
partner
By: /s/ Geoffrey L. Stack
---------------------
Name: Geoffrey L. Stack
Title: President
SIGNATURES CONTINUE ON NEXT PAGE
<PAGE>
GROUSE RUN ASSOCIATES II, a California general
partnership
By: PaineWebber Growth Properties L.P., a
Delaware limited partnership, a general
partner
By: First PW Growth Properties, Inc., a
Delaware corporation, its managing
general
partner
By: /s/ Celia R. Deluga
--------------------
Name: Celia Deluga
Title: Vice President
By: Regis Investment Partners, LTD., a
California limited partnership, a general
partner
By: Regis Home Advisors Corp., a
California corporation, its general
partner
By: /s/ Geoffrey L. Stack
---------------------
Name: Geoffrey L. Stack
Title: President
ASSIGNEE: GROUSE RUN PARTNERS, L.P., a Delaware limited
partnership
By: Sares Regis Holdings, LC, a Delaware
limited liability company, its general
partner
By: /s/ Geoffrey L. Stack
---------------------
Name: Geoffrey L. Stack
Title: President
<PAGE>
SELLER FINAL CLOSING STATEMENT
SELLER(s): Grouse Run Associates I and II
BUYER(s): Grouse Run Partners, L.P.
PROPERTY: 4738-4804 Grouse Run Drive, Stockton, CA
$ Debits $ Credits
-------- ---------
Financial:
Total Consideration $5,800,000.00
Prorations/Adjustments:
Delinquent Bal.(Current Residents Only) $50.00
Prepaid Balance $7,089.00
Rent Prorations (10/31/98) $2,518.00
Security Deposits $43,674.00
Property Taxes $21,202.00
TITLE CHARGES:
CLTA Standard Policy - (1990) form
for $5,800,000.00 $2,573.00
State Documentary Transfer Tax $6,380.00
City Transfer Tax $17,400.00
Recording two delayed recons $28.00
ESCROW CHARGES:
Escrow Fee $1,952.00
Express Mail $50.00
Wire Fee $150.00
PAYOFFS - Reilly Mortgage Group, Inc.
Total Payoff $1,343,352.87
Principal Balance $1,329,458.46
Interest to 11/01/98 $8,309.12
Forwarding/Demand Fee $150.00
Prepayment Penalty $5,435.29
PAYOFFS - Reilly Mortgage Group, Inc.
Total Payoff $1,696,693.34
Principal Balance $1,677,449.00
Interest to 11/01/98 $10,484.06
Forwarding Demand Fee $150.00
Prepayment Penalty $8,610.28
NET PROCEEDS DUE SELLER: $2,656,987.79
Distribution to Growth Fund I (PW) $2,533,991.79
Check distribution to CR Richard Ellis for
Commission and Expenses $122,996.00
TOTALS $5,800,050.00
$5,800,050.00
<PAGE>
SAVE THIS STATEMENT FOR INCOME TAX PURPOSES
GROUSE RUN ASSOCIATES I, a California
general partnership
By: PaineWebber Growth Properties LP, a
Delaware limited partnership, a
general partner
By: First PW Growth Properties,
Inc., a Delaware corporation, its
general partner
By: /s/ Celia Deluga
----------------
Celia Deluga, Vice President
By: Regis Investment Partners, Ltd., a
California limited partnership, a
general partner
By: Regis Home Advisors Corp., a
California corporation, its
general partner
By: /s/ William J. Thormahlen
-------------------------
William J. Thormahlen, Vice
President or other authorized
signatory
GROUSE RUN ASSOCIATES II , a California
general partnership
By: PaineWebber Growth Properties
L.P., a Delaware limited
partnership, a general partner
By: First PW Growth Properties,
Inc., a Delaware corporation, its
general partner
By: /s/ Celia Deluga
----------------
Celia Deluga, Vice President
By: Regis Investment Partners, Ltd., a
California limited partnership, a
general partner
By: Regis Home Advisors Corp., a
California corporation, its
general partner
By: /s/ William J. Thormahlen
-------------------------
William J. Thormahlen, Vice
President or other authorized
signatory
