SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) February 2, 1994
BALCOR PENSION INVESTORS-IV
Exact Name of Registrant
Illinois 0-11699
State or other jurisdiction Commission File Number
of organization
Balcor Plaza
4849 Golf Road
Skokie, Illinois 36-3202727
Address of principal I.R.S. Employer
executive offices Identification
60077
Zip Code
Registrant's telephone number, including area code:
(708) 677-2900
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
Republic Park One Office Building
In February 1984, the Partnership funded a $10,250,000 loan evidenced by a
promissory note and collateralized by a first mortgage on the Republic Park One
Office Building, Aurora, Colorado ("Property"). The borrower defaulted on its
obligations under the Partnership's loan and, in 1990, the Partnership acquired
title to the Property pursuant to a deed in lieu of foreclosure.
The Partnership's cash investment in the Property as of December 31, 1993 was
approximately $10,888,910. However, in accordance with its accounting
policies, the Partnership has previously reduced the carrying value of the
Property in its financial statements to $1,792,603.
On February 2, 1994, the Partnership sold the Property to an unaffiliated third
party, HMB Partners, a Colorado corporation, for a sale price of $3,250,000.
The Partnership paid $130,000 to an unaffiliated party as a brokerage
commission and approximately $114,000 in closing and other costs and received
the remaining sale proceeds of approximately $3,006,000. Neither the General
Partner nor any of its affiliates received a commission in connection with the
sale of the Property.
ITEM 5. OTHER EVENTS
a) North Kent Mall
In October 1983, the Partnership funded a $5,455,654 loan evidenced by a
promissory note in the amount of $11,000,000 and collateralized by a wrap-
around mortgage on North Kent Mall, Grand Rapids, Michigan (the "Property").
In September 1991, the loan was placed in default as a result of the borrower's
failure to make payments due under the loan and, in April 1992, the Partnership
posted the Property for a non-judicial foreclosure.
In June 1992, the borrower filed for protection under Chapter 11 of the U. S.
Bankruptcy Code, which action stayed the foreclosure proceedings. In December
1992, the Bankruptcy Court approved the borrower's plan of reorganization which
provided the borrower the option to purchase the Partnership's equity in the
loan on or before January 1, 1994 for $2,000,000, which represented a discount
of approximately $5,435,000. If the Partnership's equity in the loan was not
purchased by the borrower, the plan provided for the Partnership to acquire
title to the Property pursuant to a deed in lieu of foreclosure.
The borrower was unable to purchase the Partnership's equity in the loan and,
on January 14, 1994, the Partnership obtained title to the Property pursuant to
a deed in lieu of foreclosure, subject to two mortgage loans collateralized by
the Property, each held by an unaffiliated lender. The Partnership's net
investment in the Property was $7,851,693 as of January 1994. However, in
accordance with its accounting policies, the Partnership has previously reduced
the carrying value of the Property in its financial statements to $5,830,250.
An unaffiliated third party has been retained to provide property management
services for a fee of 3.5% of monthly gross income from the Property.
b) University Building land
In 1988, the borrower of the loan collateralized by a leasehold interest
("Leasehold Interest") in the University Building ("Building"), Denver,
Colorado, conveyed the Leasehold Interest to the Partnership, subject to a
first mortgage loan ("Loan") from an unaffiliated party. The Partnership also
received an ownership interest in certain land ("Land") underneath the
Building. The Partnership ceased making debt service payments on the Loan and,
as of May 31, 1991, conveyed the Leasehold Interest to the holder of the Loan.
The Partnership retained its interest in the Land and continued to receive
ground rent payments from the lessee.
The Partnership has not recognized any value of the Land in its financial
statements as the Partnership did not have a cash investment in the Land.
On December 20, 1993, the Partnership sold the Land to an unaffiliated third
party, University Land Corp., a Colorado corporation, for a sale price of
$100,000. The Partnership paid approximately $228 in closing costs and
received the remaining sale proceeds of approximately $99,772. Neither the
General Partner nor any of its affiliates received a commission in connection
with the sale of the Land.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(A) FINANCIAL STATEMENTS:
None
(B) PRO FORMA FINANCIAL INFORMATION:
None
(C) EXHIBITS:
(2) Agreement of Sale relating to the sale of Republic
Park One Office Building, Aurora, Colorado.
(28) Agreement of Sale relating to the sale of the
University Building land, Denver, Colorado.
No information is required under Items 1, 3, 4, 6 and 8 and these items
have, therefore, been omitted.
Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned hereunto duly authorized.
BALCOR PENSION INVESTORS-IV
By: Balcor Mortgage Advisors-III,
general partner
By: RGF-Balcor Associates-II,
a partner
By: The Balcor Company,
a partner
By: /s/ Jerry M. Ogle
Jerry M. Ogle, Vice President
and Secretary
Dated: February 16, 1994
EXHIBIT 2
AGREEMENT OF SALE
Republic Park I, 9250 East Costilla Avenue,
Englewood, Colorado
THIS AGREEMENT OF SALE (this "Agreement"), entered into as of the 20th day of
January 1994, by and between Costilla Avenue Limited Partnership, an Illinois
limited partnership ("Seller"), and HMB Partners, Inc., a Colorado corporation
("Purchaser").
RECITALS
A. Seller holds title to a commercial office building commonly known as
Republic Park I Office Building, 9250 East Costilla Avenue, Englewood, Colorado
("Building").
B. Seller desires to sell, and Purchaser desires to acquire the Building and
certain related property.
NOW, THEREFORE, in consideration of the mutual covenants, promises and
undertakings set forth in this Agreement, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Seller and Purchaser agree as follows:
1. Purchase and Sale. Purchaser agrees to purchase and Seller agrees to sell,
convey, assign, transfer and deliver at the price of Three Million Two Hundred
Fifty Thousand and No/100 Dollars ($3,250,000.00) (the "Purchase Price"), all
of Seller's right, title and interest in and to the following described
property, if any (all of which is collectively referred to as the "Property"):
(a) The real property located in the County of Arapahoe ("County"), State of
Colorado, described on Exhibit A together with all reversions, remainders,
easements, rights-of-way, appurtenances, hereditaments and water rights
appertaining to or otherwise benefiting or used in connection with such real
property, together with all of Seller's right, title and interest in and to any
strips of land, streets, and alleys abutting or adjoining such real property
("Land");
(b) The existing building and other improvements, structures, open parking
facilities and fixtures placed, constructed, installed or located on the Land,
and all plants, trees, sculptures, and other appurtenances located upon, over
or under the Land (collectively "Improvements"; the Land and Improvements are
sometimes hereinafter collectively referred to as "Real Property");
(c) All equipment and other tangible personal property owned by Seller and
located, placed or installed on or about the Real Property or used as part of
or in connection with the Real Property, specifically limited to the items
described on Exhibit B ("Personal Property");
(d) All right, title and interest of Seller, as landlord, under all leases,
tenancies or other occupancy arrangements now or hereafter affecting any
portion of the Real Property ("Leases");
(e) All right, title and interest of Seller in and to those service and
maintenance contracts described on Exhibit C attached hereto ("Service
Contracts");
(f) All right, title and interest of Seller in and to all unexpired warranties,
guaranties and bonds, including, without limitation, contracts' and
manufacturers' warranties or guaranties, relating to the Real Property or the
Personal Property, to the extent that they are assignable ("Warranties");
(g) All right, title and interest of Seller in and to all governmental permits,
licenses, certificates and authorizations, including, without limitation,
certificates of occupancy, relating to the construction, use or operation of
the Real Property or the Personal Property, to the extent that they are
assignable ("Permits");
(h) All right, title and interest of Seller in and to all site plans, surveys,
soil and substratus studies, architectural drawings, plans and specifications,
engineering, electrical and mechanical plans and studies, floor plans,
landscape plans, appraisals, feasibility studies, and other plans and studies
of any kind if existing and in Seller's possession or control that relate to
the Real Property or the Personal Property ("Plans"); and
(i) Any and all other rights, privileges, and appurtenances owned by Seller and
in any way related to, or used in connection with the operation of the Real
Property or Personal Property to the extent that they are assignable
("Intangible Property").
2. Purchase Price. The Purchase Price shall be paid by Purchaser as follows:
(a) Upon the execution of this Agreement, the sum of Two Hundred Thousand and
No/100 Dollars ($200,000.00) (the "Earnest Money") to be held in escrow by and
in accordance with the provisions of the Escrow Agreement ("Escrow Agreement")
attached hereto as Exhibit D; and
(b) On the "Closing Date" (hereinafter defined), the balance of the Purchase
Price, adjusted in accordance with the prorations, by federally wired
"immediately available" funds, on or before 1:00 p.m Chicago time.
3. Title Commitment and Survey.
(a) Attached hereto as Exhibit E is a copy of a title commitment for an owner's
standard title insurance policy issued by Land Title Guarantee Company
(hereinafter referred to as "Title Agent") as agent for old Republic National
Title Insurance Corporation (hereinafter referred to as the "Title Insurer")
dated November 23, 1993 for the Real Property (the "Title Commitment"). For
purposes of this Agreement, "Permitted Exceptions" shall mean: (a) the claims
of tenants under the Leases; (b) general real estate taxes not yet due and
payable; (c) matters shown on the "Survey" (hereinafter defined); and (d) the
title exceptions set forth in Schedule B of the Title Commitment as Numbers 9
through 25 inclusive, to the extent that same effect the Real Property. All
the other exceptions to title shall be referred to as "Unpermitted Exceptions".
The Title Commitment shall be conclusive evidence of good title as therein
shown as to all matters to be insured by the title policy, subject only to the
exceptions therein stated. On the Closing Date, Title Insurer shall deliver to
Purchaser a standard title policy in conformance with the previously delivered
Title Commitment, subject only to Permitted Exceptions (the "Title Policy").
Seller and Purchaser shall each pay for fifty percent (50%) of the costs of the
Title Commitment and Title Policy.
(b) Purchaser has received a survey of the Property prepared by Benchmark
Surveying, Ltd. dated January 6, 1994 under job number 3457 (the "Survey").
Seller and Purchaser shall each pay for one-half of the costs of the Survey.
Purchaser hereby acknowledges that all matters disclosed by the Survey are
acceptable to Purchaser.
4. Payment of Closing Costs.
(a) In addition to the costs set forth in Paragraphs 3(a) and 3(b), Purchaser
and Seller shall each pay for one-half of the costs of the documentary or
transfer stamps to be paid with reference to the "Deed" (hereinafter defined)
and all other stamps, intangible, transfer, documentary, recording, sales tax
and surtax imposed by law with reference to any other sale documents delivered
in connection with the sale of the Property to Purchaser and all other charges
of the Title Insurer in connection with this transaction.
5. Condition of Title.
(a) If, prior to Closing, a date-down to the Title Commitment discloses an
Unpermitted Exception, Seller shall have thirty (30) days from the date of the
date-down to the Title Commitment to (i) bond over, cure and/or have any
Unpermitted Exceptions which, in the aggregate, do not exceed $25,000.00,
removed from the Title Commitment or to have the Title Insurer commit to insure
against loss or damage that may be occasioned by such Unpermitted Exceptions,
or (ii) have the right, but not the obligation, to bond over, cure and/or have
any Unpermitted Exceptions which, in the aggregate, equals or exceeds
$25,000.00, removed from the Title Commitment or to have the Title Insurer
commit to insure against loss or damage that may be occasioned by such
Unpermitted Exceptions. In such event, the time of Closing shall be ten (10)
days after the date the Purchaser receives written notice of the cure of such
unpermitted Exception. If Seller fails to cure or have said Unpermitted
Exception removed or have the Title Insurer commit to insure as specified above
within said thirty (30) day period or if Seller elects not to exercise its
rights under (ii) in the preceding sentence, Purchaser may terminate this
Agreement upon notice to Seller within ten (10) days after the expiration of
said thirty (30) day period. Absent notice from Purchaser to Seller in
accordance with the preceding sentence, Purchaser shall be deemed to have
elected to take title subject to said Unpermitted Exception. If Purchaser
terminates this Agreement in accordance with the terms of this Paragraph 5(a),
this Agreement shall become null and void without further action of the parties
and all Earnest Money theretofore deposited into the escrow by Purchaser
together with any interest accrued thereon, shall be returned to Purchaser, and
neither party shall have any further liability to the other, except for
Purchaser's obligation to indemnify Seller and restore the Property, as more
fully set forth in Paragraph 7(a).
(b) Seller agrees to convey fee simple title to the Property to Purchaser at
Closing by special warranty deed ("Deed") in recordable form subject only to
the Permitted Exceptions and any Unpermitted Exceptions waived by Purchaser.
6. Condemnation, Eminent Domain, Damage and Casualty.
Except as provided in Paragraph 7(a) below, Seller shall bear all risk of loss
with respect to the Property up to the time of Closing. Notwithstanding the
foregoing, in the event of damage to the Property by fire or other casualty
prior to the Closing Date, repair of which would cost less than or equal to
$200,000.00 (as determined by Seller in good faith) Purchaser shall not have
the right to terminate its obligations under this Agreement by reason thereof,
but Seller shall have the right to elect to either repair and restore the
Property (in which case the Closing Date shall be extended until the first
business day occurring ten (10) days after completion of such restoration) or
to assign and transfer to Purchaser on the Closing Date all of Seller's right,
title and interest in and to all insurance proceeds paid or payable to Seller
on account of such fire or casualty, including remitting (or crediting) to
Purchaser the amount of any applicable insurance deductible. In the event the
insurance proceeds are not adequate to pay for the repair and restoration
Seller shall pay to Purchaser at Closing an amount equal to the difference
between the amount necessary to pay for all such repairs and restorations and
the amount of the insurance proceeds. Seller shall promptly notify Purchaser
in writing of any such fire or other casualty and Seller's determination of the
cost to repair the damage caused thereby. In the event of damage to the
Property by fire or other casualty prior to the Closing Date, repair of which
would cost in excess of $200,000.00 (as determined by Seller in good faith),
then this Agreement may be terminated at the option of Purchaser, which option
shall be exercised, if at all, by Purchaser's written notice thereof to Seller
within ten (10) business days after Purchaser receives written notice of such
fire or other casualty, and upon the exercise of such option by Purchaser this
Agreement shall become null and void, the Earnest Money deposited by Purchaser
shall be returned to Purchaser together with interest thereon, and neither
party shall have any further liability or obligations hereunder except for
Purchaser's obligations to indemnify Seller and restore the Property, as set
forth more fully in Paragraph 7(a). In the event that Purchaser does not
exercise the option set forth in the preceding sentence, the Closing shall take
place on the Closing Date and Seller shall assign and transfer to Purchaser on
the Closing Date all of Seller's right, title and interest in and to all
insurance proceeds paid or payable to Seller on account of the fire or
casualty, including remitting (or crediting) to Purchaser the amount of any
applicable insurance deductible.
(b) If between the date of this Agreement and the Closing Date, any
condemnation or eminent domain proceedings are initiated which might result in
the taking of any part of the Property or the taking or closing of any right of
access to the Property, Seller shall immediately notify Purchaser of such
occurrence. In the event that the taking of any part of the Property shall:
(i) materially impair access to the Property;
(ii) cause any material non-compliance with any applicable law, ordinance, rule
or regulation of any federal, state or local authority or governmental agencies
having jurisdiction over the Property or any portion thereof; or
(iii) materially and adversely impairs the use of the Property as it is
currently being operated (hereinafter collectively referred to as a "Material
Event"), Purchaser may:
[A] terminate this Agreement by written notice to Seller, in which event the
Earnest Money deposited by Purchaser, together with interest thereon, shall be
returned to Purchaser and all rights and obligations of the parties hereunder
with respect to the closing of this transaction will cease, except for
Purchaser's obligations to indemnify Seller and restore the Property, as set
forth more fully in Paragraph 7; or
[B] proceed with the Closing, in which event Seller shall assign to Purchaser
all of Seller's right, title and interest in and to any award made in
connection with such condemnation or eminent domain proceedings.
Purchaser shall then notify Seller, within ten (10) business days after
Purchaser's receipt of Seller's notice, whether Purchaser elects to exercise
its rights under subparagraph (a) or subparagraph (b) of this Paragraph 6(b).
Closing shall be delayed, if necessary, until Purchaser makes such election.
If Purchaser fails to make an election within such ten (10) business day
period, Purchaser shall be deemed to have elected to exercise its rights under
subparagraph (b).
If between the date of this Agreement and the Closing Date, any condemnation or
eminent domain proceedings are initiated which do not constitute a Material
Event, Purchaser shall be required to proceed with the Closing, in which event
Seller shall assign to Purchaser all of Seller's right, title and interest in
and to any award made in connection with such condemnation or eminent domain
proceedings.
7. Indemnity and AS-IS Condition.
(a) Purchaser shall defend, indemnify and hold Seller and any affiliate, parent
of Seller, and all shareholders, employees, officers and directors of Seller or
Seller's affiliate or parent (hereinafter collectively referred to as
"Affiliate of Seller") harmless from any and all liability, cost and expense
(including without limitation, reasonable attorney's fees, court costs and
costs of appeal) suffered or incurred by Seller or Affiliates of Seller for
injury to persons or property caused by Purchaser's investigations and
inspection of the Property. Purchaser shall undertake its obligation to defend
set forth in the preceding sentence using attorneys reasonably acceptable to
Seller.
(b) Seller (or an affiliate of Seller) acquired title to the Property by
foreclosure and, therefore, Seller can make no representations or warranties
relating to the condition of the Property. Purchaser acknowledges and agrees
that it will be purchasing the Property based solely upon its inspections and
investigations of the Property, and that Purchaser will be purchasing the
Property "AS IS" and "WITH ALL FAULTS", based upon the condition of the
Property as of the date of this Agreement, wear and tear and loss by fire or
other casualty or condemnation excepted. Without limiting the foregoing,
Purchaser acknowledges that, except as may otherwise be specifically set forth
elsewhere in this Agreement, neither Seller nor its consultants, brokers or
agents have made any other representations or warranties of any kind upon which
Purchaser is relying as to any matters concerning the Property, including, but
not limited to, the condition of the land or any improvements comprising the
Property, the existence or non-existence of toxic waste or any hazardous
material, economic projections or market studies concerning the Property, any
development rights, taxes, bonds, covenants, conditions and restrictions
affecting the Property, water or water rights, topography, drainage, soil,
subsoil of the Property, the utilities serving the Property or any zoning,
environmental or building laws, rules or regulations affecting the Property.
Seller makes no representation or warranty that the Property complies with
Title III of the Americans with Disabilities Act or any fire code or building
code. Purchaser hereby releases Seller and the Affiliates of Seller from any
and all liability in connection with any claims which Purchaser may have
against Seller, and Purchaser hereby agrees not to assert any claims for
contribution, cost recovery or otherwise, against Seller, relating directly or
indirectly to the existence of asbestos or hazardous materials or substances
on, or environmental conditions of, the Property, whether known or unknown. As
used herein, the term "hazardous materials or substances" means (i) hazardous
wastes, hazardous substances, hazardous constituents, toxic substances or
related materials, whether solids, liquids or gases, including but not limited
to substances defined as "hazardous wastes," "hazardous substances," "toxic
substances," "pollutants," "contaminants," "radioactive materials," or other
similar designations in, or otherwise subject to regulation under, the
Comprehensive Environmental Response, Compensation and Liability Act of 1980,
as amended ("CERCLA"), 42 U.S.C. section 9601 et seq.; the Toxic Substance
Control Act ("TSCA"), 15 U.S.C. section 2601 et seq.; the Hazardous Materials
Transportation Act, 49 U.S.C. section 1802; the Resource Conservation and
Recovery Act ("RCRA"), 42 U.S.C. section 9601. et seq.; the Clear Water Act
("CWA"), 33 U.S.C. section 1251 et seq.; the Safe Drinking Water Act, 42 U.S.C.
section 300f et seq.; the Clean Air Act ("CAA"), 42 U.S.C. section 7401 et
seq.; and in any permits, licenses, approvals, plans, rules, regulations or
ordinances adopted, or other criteria and guidelines promulgated pursuant to
the preceding laws or other similar federal, state or local laws, regulations,
rules or ordinance now or hereafter in effect relating to environmental matters
(collectively the "Environmental Laws"); and (ii) any other substances,
constituents or wastes subject to any applicable federal, state or local law,
regulator or ordinance, including any Environmental Law, now or hereafter in
effect, including but not limited to (A) petroleum, (B) refined petroleum
products, (C) waste oil, (D) waste aviation or motor vehicle fuel and (E)
asbestos.
(c) Seller has provided to Purchaser certain unaudited historical financial
information regarding the Property relating to certain periods of time in which
Seller owned the Property. Seller and Purchaser hereby acknowledge that such
information has been provided to Purchaser at Purchaser's request solely as
illustrative material. Seller makes no representation or warranty that such
material is complete or accurate or that Purchaser will achieve similar
financial or other results with respect to the operations of the Property, it
being acknowledged by Purchaser that Seller's operation of the Property and
allocations of revenues or expenses may be vastly different than Purchaser may
be able to attain. Purchaser acknowledges that it is a sophisticated and
experienced purchaser of real estate and further that Purchaser has relied upon
its own investigation and inquiry with respect to the operation of the Property
and releases Seller from any liability with respect to such historical
information.
(d) Seller has provided to Purchaser the following existing reports: (i)
Preliminary Environmental Site Assessment, dated September 20, 1990, and (ii)
Facilities Survey to Identify Asbestos Containing Materials, dated September 1,
1992 (together, the "Existing Reports"). Seller makes no representation or
warranty concerning the accuracy or completeness of the Existing Reports.
Purchaser hereby releases Seller from any liability whatsoever with respect to
the Existing Reports, or, including, without limitation, the matters set forth
in the Existing Reports, the accuracy and/or completeness of the Existing
Reports. Furthermore, Purchaser acknowledges that it will be purchasing the
Property with all faults disclosed in the Existing Reports.
8.Closing. The closing of this transaction (the "Closing") shall be on
February 2, 1994 (the "Closing Date"), at the office of Title Agent, Denver,
Colorado at which time Seller shall deliver possession of the Property to
Purchaser. This transaction shall be closed through an escrow with Title
Agent, in accordance with the general provisions of the usual and customary
form of deed and money escrow for similar transactions in Colorado, or at the
option of either party, the Closing shall be a "New York style" closing at
which the Purchaser shall wire the Purchase Price to Title Agent on the Closing
Date and prior to the release of the Purchase Price to Seller, Purchaser shall
receive the Title Policy or marked up commitment dated the date of the Closing
Date. In the event of a New York style closing, Seller shall deliver to Title
Agent and/or Title Insurer any customary affidavit in connection with a New
York style closing. All closing and escrow fees shall be divided equally
between the parties hereto.
9. Closing Documents.
(a) On the Closing Date, Purchaser shall deliver to Seller an executed closing
statement, the balance of the Purchase Price, a real property transfer
declaration and such other documents as may be reasonably required by the Title
Agent and/or Title Insurer in order to consummate the transaction as set forth
in this Agreement.
(b) On the Closing Date, Seller shall deliver to Purchaser the following:
(i) the Deed (in the form of Exhibit F attached hereto), subject to Permitted
Exceptions and those Unpermitted Exceptions waived by Purchaser;
(ii) a quit claim bill of sale conveying the Personal Property (in the form of
Exhibit G attached hereto);
(iii) assignment and assumption of intangible property (in the form attached
hereto as Exhibit H);
(iv) an assignment and assumption of leases and security deposits (in the form
attached hereto as Exhibit I);
(v) non-foreign affidavit (in the form of Exhibit J attached hereto);
(vi) original, and/or copies of, leases affecting the Property in Seller's
possession;
(vii) all documents and instruments reasonably required by the Title Agent
and/or Title Insurer to issue the Title Policy;
(viii) possession of the Property;
(ix) an executed closing statement;
(x) notice to the tenants of the Property of the transfer of title and
assumption by Purchaser of the landlord's obligation under the leases and the
obligation to refund the security deposits (in the form of Exhibit K);
(xi) an updated rent roll, dated no more than ten (10) days prior to Closing;
and
(xii) original, and/or copies of, all assigned Service Contracts all Permits,
Warranties, Plans and copies of intangible property, if and to the extent same
are in the possession of Seller.
10. Default by Purchaser. ALL EARNEST MONEY DEPOSITED INTO THE ESCROW IS TO
SECURE THE TIMELY PERFORMANCE BY PURCHASER OF ITS OBLIGATIONS AND UNDERTAKINGS
UNDER THIS AGREEMENT. IN THE EVENT OF A DEFAULT OF THE PURCHASER UNDER THE
PROVISIONS OF THIS AGREEMENT, SELLER SHALL RETAIN ALL OF THE EARNEST MONEY AND
THE INTEREST THEREON AS SELLER'S SOLE RIGHT TO DAMAGES OR ANY OTHER REMEDY,
EXCEPT FOR PURCHASER'S OBLIGATIONS TO INDEMNIFY SELLER PURSUANT TO PARAGRAPH
7(a) HEREOF. THE PARTIES HAVE AGREED THAT SELLER'S ACTUAL DAMAGES, IN THE
EVENT OF A DEFAULT BY PURCHASER, WOULD BE EXTREMELY DIFFICULT OR IMPRACTICAL TO
DETERMINE. THEREFORE, BY PLACING THEIR INITIALS BELOW, THE PARTIES ACKNOWLEDGE
THAT THE EARNEST MONEY HAS BEEN AGREED UPON, AFTER NEGOTIATION, AS THE PARTIES'
REASONABLE ESTIMATE OF SELLER'S DAMAGES.
11. SELLER'S DEFAULT. IF THIS SALE IS NOT COMPLETED BECAUSE OF SELLER'S
DEFAULT, PURCHASER'S SOLE REMEDY SHALL BE THE RETURN OF ALL EARNEST MONEY
TOGETHER WITH ANY INTEREST ACCRUED THEREON, AND THIS AGREEMENT SHALL THEN
BECOME NULL AND VOID AND OF NO EFFECT AND THE PARTIES SHALL HAVE NO FURTHER
LIABILITY TO EACH OTHER AT LAW OR IN EQUITY, EXCEPT FOR PURCHASER'S OBLIGATIONS
TO INDEMNIFY SELLER AND RESTORE THE PROPERTY AS SET FORTH MORE FULLY IN
PARAGRAPH 7(a). NOTWITHSTANDING ANYTHING CONTAINED HEREIN TO THE CONTRARY, IF
SELLER'S DEFAULT IS ITS REFUSAL TO DELIVER THE DEED, THEN PURCHASER WILL BE
ENTITLED TO SUE FOR SPECIFIC PERFORMANCE.
12. Prorations.
(a) Rents (exclusive of delinquent rents, but including prepaid rents);
refundable security deposits (which will be assigned to and assumed by
Purchaser and credited to Purchaser at Closing); water and other utility
charges; fuels; operating expenses; real and personal property taxes (based
upon 1993 taxes) prorated on a "net" basis (i.e. adjusted for all tenants'
liability, if any, for such items); operating expenses which are reimbursable
by the tenants for the period prior to the Proration Date less any amount
previously paid by the Tenants shall be credited to Seller; and other similar
items shall be adjusted ratably as of 12:01 a.m. on February 1, 1994 (the
"Proration Date"), and credited to the balance of the cash due at Closing.
Seller shall pay all unpaid 1993 taxes and assessments concerning the Property
at Closing. Assessments payable in installments which are due subsequent to
the Closing Date shall be paid by Purchaser. If the amount of any of the items
to be prorated is not then ascertainable, the adjustments thereof shall be on
the basis of the most recent ascertainable data. All prorations will be final
except as to delinquent rent referred to in Paragraph 12c below.
(b) In addition, Buyer will receive a credit at Closing in a sum equal to the
then remaining amount of base rent abatement available to: (i) Centex Real
Estate Corporation ("Centex"), pursuant to the Office Building Lease, dated
April 28, 1993, by and between Seller, as landlord and Centex, as tenant, as
amended by a First Amendment to Lease, dated May 24, 1993 (the "Centex Lease");
(ii) Ralph L. Walker, an individual; D/B/A Walker Commercial ("Walker")
pursuant to the Office Building Lease, dated September 30, 1993, between
Seller, as landlord and Walker, as tenant (the "Walker Lease"); and (iii) Peter
Webb, an individual, D/B/A Peter Webb Public Relations, a sole proprietorship
("Webb"), pursuant to the Office Building Lease, dated October 5, 1993, between
Seller, as landlord, and Webb, as tenant (the "Webb Lease"). If the Closing
occurs on February 2, 1994, the parties acknowledge the credit shall be
$91,593.60 for the Centex Lease, $3,820.55 for the Walker Lease and $3,638.68
for the Webb Lease.
(c) All sums paid following the Closing Date by any tenant of the Property who
is indebted under a lease for any period prior to and including the Closing
Date shall be deemed a "Post-Closing Receipt" until such time as all such
indebtedness is paid in full. Any rents collected by Purchaser after Closing
shall be first applied to the current month's rent due on the date of receipt
or rent to become due within fourteen (14) days thereafter, then to delinquent
rents for any period occurring from and after the Date of Closing and the
remaining balance shall constitute a Post Closing Receipt, then to prior to the
Date of Closing. Within ten (10) days following each receipt by Purchaser of a
Post-Closing Receipt, Purchaser shall pay such Post-Closing Receipt to Seller.
Purchaser shall use reasonable efforts to collect all amounts which, upon
collection, would constitute Post-Closing Receipts hereunder; provided,
however, Purchaser shall not be required to bring any eviction or any other
legal action against any tenant of the Property. Paragraph 12b of this
Agreement shall survive the Closing and the delivery and recording of the deed.
13. Tenant Estoppel Certificates. Seller agrees to use reasonable efforts to
obtain and deliver to Purchaser, on or before January 31, a tenant estoppel
certificate for each and every Lease (other than System Integrators),
substantially in the form of the tenant estoppel certificate attached hereto as
Exhibit K, completed and executed by or on behalf of each tenant under said
Lease. If: (a) Seller is unable, despite its reasonable efforts, to deliver to
Purchaser tenant estoppel certificates from Intracorp and Centex on or before
the Closing Date; and/or (b) the tenant estoppel certificates delivered to
Purchaser indicate a dispute with Seller in an aggregate amount in excess of
twenty-five thousand dollars ($25,000.00), Purchaser shall have as its sole and
exclusive remedy the right to terminate this Agreement as provided in this
Paragraph 13. Tenant shall exercise its right to terminate this Agreement
pursuant to this Paragraph 13, if at all, by delivering to Seller a written
notice of Purchaser's election to terminate on or before 5:00 p.m, Chicago time
February 1, 1994. If Purchaser fails to deliver such notice on or before 5:00
p.m. Chicago time, February 1, 1994, Purchaser shall be conclusively presumed
to have waived its right to terminate this Agreement pursuant to this Paragraph
13. If this Agreement is terminated by Purchaser in accordance wit this
Paragraph 13, the Earnest Money Deposit and the interest accrued thereon shall
be returned to Purchaser and all rights and obligations of the parties
hereunder with respect to the Closing of this transaction shall cease, except
for Purchaser's obligations to indemnify Seller and restore the Property as set
forth more fully in Paragraph 7(a).
14. Recording. This Agreement shall not be recorded and the act of recording
by Purchaser shall be an act of default hereunder by Purchaser and subject to
the provisions of Paragraph 10.
15. Assignment. The Purchaser shall not have the right to assign its interest
in this Agreement without the prior written consent of the Seller. Any
assignment or transfer of, or attempt to assign or transfer, Purchaser's
interest in this Agreement shall be an act of default hereunder by Purchaser
and subject to the provisions of Paragraph 10. Notwithstanding the foregoing
provisions of this Paragraph 15 to the contrary, provided Purchaser shall
remain liable for all obligations and covenants under this Agreement, the
Purchaser shall be permitted to assign all of its right, title and interest in
this Agreement to a corporation, limited liability company or limited
partnership provided that Donald E. Beauregard and Thomas N. Morrill are (i)
officers and directors of such corporation if the assignee is a corporation,
(ii) members and managers of such limited liability company if the assignee is
a limited liability company, or (iii) officers and directors of the corporate
general partner of such limited partnership if the assignee is a limited
partnership. Purchaser agrees to provide Seller with prompt written notice of
any permitted assignment of its interest in the Agreement.
16. Broker. The parties hereto represent and warrant that no broker commission
or finder fee is due and payable in connection with this transaction other than
to CB Commercial Real Estate Group (to be paid by Seller). Seller's commission
to CB Commercial Real Estate Group shall only be payable out of the proceeds of
the sale of the Property in the event the transaction set forth herein closes.
Purchaser shall indemnify, defend and hold Seller and Affiliates of Seller
harmless from any claim whatsoever (including without limitation, reasonable
attorney's fees, court costs and costs of appeal) from anyone claiming by or
through Purchaser any fee, commission or compensation on account of this
Agreement, its negotiation or the sale hereby contemplated other than to CB
Commercial Real Estate Group. Purchaser shall undertake its obligations set
forth in the preceding sentence using attorneys reasonably acceptable to
Seller. Seller shall indemnify, defend and hold Purchaser harmless from any
claim whatsoever (including without limitation, reasonable attorneys' fees,
court costs and costs of appeal) from anyone claiming by or through Seller any
fee, commission or compensation on account of this Agreement, its negotiation
or the sale hereby contemplated. Seller shall undertake its obligations set
forth in the preceding sentence using attorneys reasonably acceptable to
Purchaser. The provisions of this Paragraph 16 will survive the Closing and
delivery of the Deed.
17. Seller's Representations and Warranties.
(a) Any reference herein to Seller's knowledge, representation, warranty or
notice of any matter or thing shall only mean such knowledge or notice that has
actually been received by Phillip Schechter (hereinafter collectively referred
to as the "Seller's Representative"), and any representation or warranty of the
Seller is based upon those matters of which the Seller's Representative has
actual knowledge. Any knowledge or notice given, had or received by any of
Seller's agents, servants or employees shall not be imputed to Seller, the
general partner or limited partners of Seller, the subpartners of the general
partner or limited partners of Seller or Seller's Representative.
(b) Subject to the limitations set forth in Paragraph (a) of this Paragraph 17,
Seller hereby makes the following representations and warranties, which
representations and warranties are made to the best of Seller's knowledge:
(i) Seller has no knowledge of any material pending or threatened litigation,
claim, cause of action or administrative proceeding concerning the Property;
(ii) Seller has the power to execute this Agreement and consummate the
transactions contemplated herein;
(iii) the rent roll which Seller has submitted to the Purchaser and updated as
of the Closing Date are accurate;
(iv) Seller has not received written notice prior to the date hereof from any
governmental authority of any violation of any zoning, building, fire or health
code or law applicable to the Property or any portion thereof, that has not
heretofore been corrected; and
(v) the Service Contracts constitute all of the material contracts made by or
on behalf of Seller which affect the Property as of the date hereof with the
exception of the Leases, the Permitted Exceptions and the existing property
management agreement between Seller and Allegiance Realty, Inc. which is to be
terminated effective upon Closing; and
(c) Representations and warranties made herein shall survive the Closing and
delivery of the Deed; provided, however, that any claim for a breach of a
representation or warranty hereunder shall be conclusively presumed to have
been waived by Purchaser and Purchaser shall have no right to bring any claims
unless written notice thereof specifically detailing the nature of the breach
is given to Seller within sixty (60) days from and after the Closing Date.
18. Limitation of Liability. None of Seller's beneficiaries, shareholders,
partners, officers, agents or employees, heirs, successors or assigns shall
have any personal liability of any kind or nature for or by reason of any
matter or thing whatsoever under, in connection with, arising out of or in any
way related to this Agreement and the transactions contemplated herein, and
Purchaser hereby waives for itself and anyone who may claim by, through or
under Purchaser any and all rights to sue or recover on account of any such
alleged personal liability.
19. Time of Essence. Time is of the essence of this Agreement.
20. Notices. Any notice or demand which either party hereto is required or may
desire to give or deliver to or make upon the other party shall be in writing
and may be personally delivered or given or made by overnight courier such as
Federal Express or made by United States registered or certified mail addressed
as follows:
To Seller:
c/o The Balcor Company
4849 West Golf Road
Skokie, Illinois 60077
Attention: Ilona Adams
with copies to:
The Balcor Company
4849 West Golf Road
Skokie, Illinois 60077
Attention: Alan Lieberman
(708) 677-2900
(708) 982-4027 (FAX)
and to:
Katten Muchin & Zavis
525 West Monroe Street
Suite 1600
Chicago, Illinois 60661-3693
Attention: Daniel J. Perlman, Esq.
(312) 902-5532
(312) 902-1061 (FAX)
To Purchaser:
HMB Partners, Inc.
6300 South Syracuse Way, Suite 355
Englewood, Colorado 80111
Attention: Thomas N. Morrill
(303) 771-0084
(303) 771-0085 (FAX)
and one copy to:
Robinson, Waters, O'Dorisio & Rapson
1099 10th Street
Suite 2600
Denver, CO 80202
Attention: John W. O'Dorisio, Jr., Esq.
(303) 297-2600
(303) 297-2750 (FAX)
subject to the right of either party to designate a different address for
itself by notice similarly given. Any notice or demand so given shall be
deemed to be delivered or made on the next business day if sent by overnight
courier, or on the 4th business day after the same is deposited in the United
States Mail as registered or certified matter, addressed as above provided,
with postage thereon fully prepaid. Any such notice, demand or document not
given, delivered or made by registered or certified mail or by overnight
courier as aforesaid shall be deemed to be given, delivered or made upon
receipt of the same by the party to whom the same is to be given, delivered or
made. Copies of all notices shall be served upon the Escrow Agent.
21. Execution of Agreement and Escrow Agreement. Purchaser will execute three
(3) copies of this Agreement and four (4) copies of the Escrow Agreement and
forward them to Seller for execution, accompanied with the Earnest Money
payable to the Escrow Agent set forth in the Escrow Agreement. Seller will
forward one (1) copy of the executed Agreement to Purchaser and will forward
the following to the Escrow Agent:
(a) Earnest Money;
(b) One (1) fully executed copy of this Agreement; and
(c) Three (3) copies of the Escrow Agreement signed by the parties with a
direction to execute two (2) copies of the Escrow Agreement and deliver a fully
executed copy to each of the Purchaser and the Seller.
22. Governing Law. The provisions of this Agreement shall be governed by the
laws of the State of Colorado, except that with respect to the retainage of the
Earnest Money as liquidated damages the laws of the State of Illinois shall
govern.
23. Entire Agreement. This Agreement constitutes the entire agreement between
the parties and supersedes all other negotiations, understandings and
representations made by and between the parties and the agents, servants and
employees.
24. Counterparts. This Agreement may be executed in multiple counterparts,
each of which shall be deemed an original but all of which shall constitute one
and the same instrument.
25. Captions. Paragraph titles or captions contained herein are inserted as a
matter of convenience and for reference, and in no way define, limit, extend or
describe the scope of this Agreement or any provision hereof.
26. Miscellaneous.
(a) License Disclosure. Purchaser hereby discloses and Seller hereby
acknowledges that certain shareholders, officers, directors and affiliates of
the Purchaser are licensed salespersons and/or brokers within the State of
Colorado;
(b) Form 1099 S. For the purpose of complying with Internal Revenue Service
reporting requirements for this transaction, the Title Agent shall be obligated
to prepare and file the 1099-S form (and any necessary supporting
documentation) and Seller and Purchaser shall cooperate with any requests from
the Title Agent in connection therewith.
IN WITNESS WHEREOF, the parties hereto have put their hand and seal as of the
20th day of January, 1994.
PURCHASER:
HMB PARTNERS, INC., a Colorado corporation
By: /s/ Thomas N. Morrill
Thomas N. Morrill, President
SELLER:
COSTILLA AVENUE LIMITED
PARTNERSHIP an Illinois limited
partnership
BY: Republic Partners, Inc., an Illinois corporation
By: /s/ Phillip Schechter
Its: /s/ Authorized Agent
Sherman Miller of CB Commercial Real Estate Group ("Seller's Broker")
executed this Agreement in its capacity as a real estate broker and
acknowledges that the fee or commission due it from Seller as a result of the
transaction described in this Agreement is as set forth in that certain Listing
Agreement, dated as of July 1, 1993, as amended, between Seller and Seller's
Broker (the "Listing Agreement"). Seller's Broker also acknowledges that
payment of the aforesaid fee or commission is conditioned upon the Closing and
the receipt of the Purchase Price by the Seller. Seller's Broker agrees to
deliver a receipt to the Seller at the Closing for the fee or commission due
Seller's Broker and a release stating that no other fees or commissions are due
to it from Seller or Purchaser.
CB COMMERCIAL REAL ESTATE GROUP,
By: /s/ Sherman Miller
LIST OF EXHIBITS
EXHIBIT A Legal
EXHIBIT B Personal Property
EXHIBIT C Service Contracts
EXHIBIT D Escrow Agreement
EXHIBIT E Title Commitment
EXHIBIT F Deed
EXHIBIT G Bill of Sale
EXHIBIT H Assignment and Assumption of Intangible Property
EXHIBIT I Assignment and Assumption of Leases and Security
Deposits Affidavit
EXHIBIT J Non-Foreign
EXHIBIT K Notice to Tenants
EXHIBIT L Tenant Estoppel
EXHIBIT 28
16300\7784\AGMTSALE 12/10/93
University
AGREEMENT OF SALE
THIS AGREEMENT, entered into as of the 17th day of December, 1993, by and
between UNIVERSITY LAND CORP., a Colorado corporation ("Purchaser") and
UNIVERSITY OFFICE LIMITED PARTNERSHIP, an Illinois Limited Partnership
("Seller").
WITNESSETH:
1. PURCHASE AND SALE. Purchaser agrees to purchase and Seller agrees to sell
at the price of One Hundred Thousand and No/100 Dollars ($100,000.00) fee
simple title to that certain property in Denver, Colorado, more particularly
described on Exhibit A attached hereto ("Property").
2. PURCHASE PRICE. The Purchase Price shall be paid as follows:
a. Upon the execution of this Agreement, the sum of $15,000.00 ("Earnest
Money") to be held in escrow by and in accordance with the provisions of the
Escrow Agreement ("Escrow Agreement") attached hereto as Exhibit B;
b. On the Closing Date (as hereinafter defined), $100,000.00 (inclusive of
all Earnest Money) adjusted in accordance with the prorations by federally
wired "immediately available" funds.
3. TITLE COMMITMENT. Attached hereto as Exhibit C is a title commitment dated
November 9, 1993 ("Title Commitment") for an owner's standard coverage title
insurance policy ("Title Policy") issued by Security Title, agent for First
American Title Insurance Company ("Title Insurer"). The owner's Title Policy
issued at Closing will be in the amount of the Purchase Price subject only to
real estate taxes not yet due and payable, the general printed exceptions
contained in the policy and the special title exceptions set forth in Schedule
B-2, Numbers 7 through 10 inclusive of the Title Commitment. All of the above
are herein referred to as the "Permitted Exceptions". The Title Commitment
shall be conclusive evidence of good title as therein shown as to all matters
insured by the policy, subject only to the exceptions therein stated. On the
Closing Date, Seller shall cause the Title Insurer to issue the Title Policy or
a "marked up" commitment in conformity with the Title Commitment. Purchaser
shall pay the costs of the Title Policy.
4. CONVEYANCE. Seller agrees to convey fee simple title to the Property by
Special Warranty Deed ("Deed") in recordable form subject only to the Permitted
Exceptions. If Seller is unable to convey title to the Property, subject only
to the Permitted Exceptions because of an additional title exception
("Unpermitted Exception"), then Purchaser can elect to either: 1) take title to
the Property subject to the Unpermitted Exception or 2) terminate this
Agreement. If Purchaser elects to terminate this Agreement, then the Earnest
Money plus all accrued interest shall be delivered to the Purchaser and subject
to the survival provisions of Paragraph 15, neither party shall have any
further liability hereunder. Notwithstanding anything contained herein to the
contrary, Seller shall remove all liens of a definite and ascertainable amount.
5. PAYMENT OF CLOSING COSTS. Purchaser shall pay the costs of the documentary
stamps (if any) to be paid with reference to the Deed and all other stamps,
intangible, documentary, recording, sales tax and surtax imposed by law with
reference to any other documents delivered in connection with this Agreement.
6. CONDEMNATION.
a. If condemnation proceedings ("Proceedings") have been instituted against
the Property and such Proceedings are in an amount in excess of $100,000.00,
then Purchaser can elect to either take the Property subject to the Proceedings
and an assignment of Seller's interest in the Proceedings or terminate this
Agreement. If Purchaser elects to terminate this Agreement, it shall be by
notice to the Seller within five (5) days after Seller notifies Purchaser of
the Proceedings.
b. If the Agreement is terminated pursuant to this Paragraph, then all
Earnest Money plus the interest accrued thereon shall be returned to the
Purchaser and, subject to the survival provisions of Paragraph 15 herein,
neither party shall have any further liability hereunder.
7. AS-IS CONDITION. Purchaser acknowledges and agrees that it will be
purchasing the Property based solely upon its inspection and investigations of
the Property and that Purchaser will be purchasing the Property "AS IS" and
"WITH ALL FAULTS" based upon the condition of the Property as of the date of
this Agreement. Without limiting the foregoing, Purchaser acknowledges that,
except as may otherwise be specifically set forth elsewhere in this Agreement,
neither Seller nor its consultants, brokers or agents have made any other
representations or warranties of any kind upon which Purchaser is relying as to
any matters concerning the Property, including, but not limited to, the
condition of the land or any improvements, the existence or nonexistence of
asbestos, lead in water, lead in paint, radon, underground or above ground
storage tanks, petroleum, toxic waste or any Hazardous Materials or Hazardous
Substances (as such terms are defined below), the tenants of the Property or
the leases affecting the Property, economic projections or market studies
concerning the Property, any development rights, taxes, bonds, covenants,
conditions and restrictions affecting the Property, water or water rights,
topography, drainage, soil, subsoil of the Property, the utilities serving the
Property or any zoning, environmental or building laws, rules or regulations
affecting the Property. Seller makes no representation that the Property
complies with Title III of the Americans With Disabilities Act or any fire
codes or building codes. Purchaser hereby releases Seller from any and all
liability in connection with any claims which Purchaser may have against
Seller, and Purchaser hereby agrees not to assert any claims, for damage, loss,
compensation, contribution, cost recovery or otherwise, against Seller, whether
in tort, contract, or otherwise, relating directly or indirectly to the
existence of asbestos or Hazardous Materials or Hazardous Substances on, or
environmental conditions of, the Property, or arising under the Environmental
Laws (as such term is hereinafter defined), or relating in any way to the
quality of the indoor or outdoor environment at the Property. As used herein,
the term "Hazardous Materials" or "Hazardous Substances" means (i) hazardous
wastes, hazardous materials, hazardous substances, hazardous constituents,
toxic substances or related materials, whether solids, liquids or gases,
including but not limited to substances defined as "hazardous wastes,"
"hazardous materials," "hazardous substances," "toxic substances,"
"pollutants," "contaminants," "radioactive materials," or other similar
designations in, or otherwise subject to regulation under, the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended
("CERCLA"), 42 U.S.C. section 9601 et seq.; the Toxic Substance Control Act
("TSCA"), 15 U.S.C. section 2601 et seq.; the Hazardous Materials
Transportation Act, 49 U.S.C. section 1802; the Resource Conservation and
Recovery Act ("RCRA"), 42 U.S.C. section 9601, et seq.; the Clean Water Act
("CWA"), 33 U.S.C. section 1251 et seq.; the Safe Drinking Water Act, 42 U.S.C.
section 300f et seq.; the Clean Air Act ("CAA"), 42 U.S.C. section 7401 et
seq.; and in any permits, licenses, approvals, plans, rules, regulations or
ordinances adopted, or other criteria and guidelines promulgated pursuant to
the preceding laws or other similar federal, state or local laws, regulations,
rules or ordinance now or hereafter in effect relating to environmental matters
(collectively the "Environmental Laws"); and (ii) any other substances,
constituents or wastes subject to any applicable federal, state or local law,
regulation or ordinance, including any Environmental Law, now or hereafter in
effect, including but not limited to (A) petroleum, (B) refined petroleum
products, (C) waste oil, (D) waste aviation or motor vehicle fuel, (E)
asbestos, (F) lead in water, paint or elsewhere, (G) radon, (H) Polychlorinated
Biphenyls (PCB's) and (I) ureaformaldehyde.
8. CLOSING. The closing ("Closing") of this transaction shall be on December
16, 1993 ("Closing Date"), through an escrow closing with the Title Insurer, at
which time Seller shall deliver possession of the Property to Purchaser. The
parties shall deliver appropriate escrow instructions to the Escrow Agent,
which instructions shall conform with the provisions of this Agreement and
which shall provide for the delivery of the Deed and other closing documents
and for the receipt and disbursement of the cash due at Closing.
9. CLOSING DOCUMENTS.
a. On the Closing Date, Purchaser shall deliver to Seller an executed closing
statement, and such other documents as may be reasonably required in order to
consummate the transaction as set forth in this Agreement.
b. On the Closing Date, Seller shall deliver to Purchaser possession of the
Property; the Deed (in the form of Exhibit D attached hereto) subject to the
Permitted Exceptions; an executed closing statement; an executed assignment and
assumption of the ground leases (in the form of Exhibit E attached hereto),
copies of which ground leases are attached hereto as Exhibit F; updated rent
roll; a notice to the tenants of the transfer of title and the assumption by
Purchaser of the landlord's obligations under the leases (in the form of
Exhibit G attached hereto); a non-foreign affidavit (in the form of Exhibit H
attached hereto) and such other documents as may be reasonably required by the
Title Insurer in order to consummate the transaction as set forth in this
Agreement.
10. DEFAULT BY PURCHASER. ALL EARNEST MONEY DEPOSITED INTO THE ESCROW IS TO
SECURE THE TIMELY PERFORMANCE BY PURCHASER OF ITS OBLIGATIONS AND UNDERTAKINGS
UNDER THIS AGREEMENT. IN THE EVENT OF ANY DEFAULT OF THE PURCHASER UNDER THE
PROVISIONS OF THIS AGREEMENT, SELLER SHALL RETAIN ALL OF THE EARNEST MONEY AND
THE INTEREST THEREON AS SELLER'S SOLE RIGHT TO DAMAGES OR ANY OTHER REMEDY.
THE PARTIES HAVE AGREED THAT SELLER'S ACTUAL DAMAGES, IN THE EVENT OF A DEFAULT
BY PURCHASER, WOULD BE EXTREMELY DIFFICULT OR IMPRACTICAL TO DETERMINE.
THEREFORE, BY PLACING THEIR INITIALS BELOW, THE PARTIES ACKNOWLEDGE THAT THE
EARNEST MONEY HAS BEEN AGREED UPON, AFTER NEGOTIATION, AS THE PARTIES'
REASONABLE ESTIMATE OF SELLER'S DAMAGES.
11. SELLER'S DEFAULT. IF THIS SALE IS NOT COMPLETED BECAUSE OF SELLER'S
DEFAULT, PURCHASER'S SOLE REMEDY SHALL BE THE RETURN OF ALL EARNEST MONEY
TOGETHER WITH ANY INTEREST ACCRUED THEREON, AND, SUBJECT TO THE SURVIVAL
PROVISIONS OF PARAGRAPH 15B HEREIN, THIS AGREEMENT SHALL TERMINATE AND THE
PARTIES SHALL HAVE NO FURTHER LIABILITY TO EACH OTHER AT LAW OR IN EQUITY.
NOTWITHSTANDING ANYTHING CONTAINED HEREIN TO THE CONTRARY, IF SELLER'S DEFAULT
IS ITS REFUSAL TO DELIVER THE DEED, THEN PURCHASER WILL BE ENTITLED TO SUE FOR
SPECIFIC PERFORMANCE.
12. PRORATIONS. Rents (exclusive of delinquent rents, but including prepaid
rents); real and personal property taxes prorated on a "net" basis (i.e.
adjusted for all tenants' liability, if any, for such items); and other similar
items shall be adjusted ratably as of 12:01 a.m. on the Closing Date
("Proration Date"), and credited or debited to the balance of the cash due at
Closing. If the amount of any of the items to be prorated is not then
ascertainable, the adjustment thereof shall be on the basis of the most recent
ascertainable data. All prorations will be final. If special assessments have
been levied against the Property for completed improvements, then the amount of
any installments which are due prior to the Closing Date shall be paid by the
Seller; and the amount of installments which are due after the Closing Date
shall be paid by the Purchaser. All assessments for incomplete improvements
shall be paid by Purchaser.
13. RECORDING. This Agreement shall not be recorded and the act of recording
by Purchaser shall be an act of default hereunder by Purchaser and shall be
subject to the provisions of Paragraph 10.
14. BROKER. The parties hereto acknowledge that they have not engaged the
services of a real estate broker. Purchaser has not paid and will not pay at
any time before, at or after the Closing, any fee, commission or compensation
whatsoever to any person whomsoever directly or indirectly on account of this
Agreement, its negotiation, or the sale hereby contemplated. The foregoing
does not apply to any fee which may be paid to any affiliate of Seller as a
result of this transaction. Purchaser agrees to indemnify, defend and hold
harmless the Seller and any partner, affiliate, parent of Seller, and all
shareholders, employees, officers and directors of Seller or Seller's partner,
parent or affiliate (each of the above is individually referred to as a "Seller
Indemnitee") from all claims, including attorneys' fees and costs incurred by a
Seller Indemnitee as a result of anyone's claiming by or through Purchaser any
fee, commission or compensation on account of this Agreement, its negotiation
or the sale hereby contemplated. Purchaser does now and shall at all times
consent to a Seller Indemnitee's selection of defense counsel. Seller agrees
to indemnify, defend and hold harmless the Purchaser and all shareholders,
employees, officers and directors of Purchaser or Purchaser's parent or
affiliate (each of the above is individually referred to as a "Purchaser
Indemnitee") from all claims, including attorneys' fees and costs incurred by a
Purchaser Indemnitee as a result of anyone's claiming by or through Seller any
fee, commission or compensation on account of this Agreement, its negotiation
or the sale hereby contemplated. Seller does now and shall at all times
consent to a Purchaser Indemnitee's selection of defense counsel. The
provisions of this Paragraph will survive the Closing and delivery of the Deed.
15. INSPECTION OF PROPERTY.
a. Purchaser agrees to defend and hold Seller harmless from any injuries,
damages or claims of any nature whatsoever which Purchaser's servants, agents
or employees may have as a result of Purchaser's inspection of the Property.
Purchaser further agrees to restore any damage to the Property which may arise
as a result of Purchaser's inspection of the Property.
b. Purchaser's obligations to indemnify, defend and hold Seller harmless
under the provisions of this Paragraph 15 shall survive the termination of this
Agreement or the Closing and the delivery and recording of the Deed.
16. SELLER'S REPRESENTATIONS AND WARRANTIES AND LIABILITY.
a. Any reference herein to Seller's knowledge, representation, warranty or
notice of any matter or thing, shall only mean such knowledge or notice that
has actually been received by Phillip Schechter, the sales person responsible
for the Property and David Bennett, the person who is responsible for the
management of Seller's interest in the Property, and any representation or
warranty of the Seller is based upon those matters of which Phillip Schechter
and/or David Bennett has actual knowledge. Any knowledge or notice given, had
or received by any of Seller's agents, servants or employees shall not be
imputed to Seller or the individual partners or the general partner of Seller.
b. Subject to the limitations set forth in subparagraph a above, Seller
hereby makes the following representations and warranties, all of which are
made to the best of Seller's knowledge, none of which shall survive the Closing
and delivery of the Deed:
i. Seller has not received any written notice of default under the
Ground Leases attached hereto as Exhibit F.
ii. Neither tenant has exercised any option to purchase fee simple title
to the leasehold estates described on the Ground Leases.
iii. Seller has not entered into any agreements to assign its interest in
the Property.
iv. Seller has no knowledge of any pending or threatened litigation,
claim, cause of action or administrative proceeding concerning the
Property.
v. There have been no amendments to the Ground Leases.
vi. There are no defaults under the Ground Leases.
vii. Neither tenant under the Ground Leases has sent any notice to Seller
purporting to exercise a right to renew or extend the term of the
Ground Leases or a portion thereof.
viii. The total basic rent payable under the Ground Leases to Seller's
interest is $1,000.00 per month.
ix. Seller has not received any prepayment of rent from either of the
tenants under the Ground Leases.
17. LIMITATION OF SELLER'S LIABILITY. No general or limited partner of Seller,
nor any of its respective beneficiaries, shareholders, partners, officers,
agents, employees, heirs, successors or assigns shall have any personal
liability of any kind or nature for or by reason of any matter or thing
whatsoever under, in connection with, arising out of or in any way related to
this Agreement and the transactions contemplated herein, and Purchaser hereby
waives for itself and anyone who may claim by, through or under Purchaser any
and all rights to sue or recover on account of any such alleged personal
liability.
18. TIME OF ESSENCE. Time is of the essence of this Agreement.
19. NOTICES. Any notice or demand which either party hereto is required or may
desire to give or deliver to or make upon the other party shall be in writing
and may be personally delivered or given or made by overnight courier such as
Federal Express or by facsimile or made by United States registered or
certified mail addressed as follows:
TO SELLER: c/o The Balcor Company
4849 West Golf Road
Skokie, Illinois 60077
Attn: Ilona Adams
with copies to: The Balcor Company
4849 West Golf Road
Skokie, Illinois 60077
Attn: Al Lieberman
708/677-2900
708/982-4027 (FAX)
and
Morton M. Poznak
Schwartz & Freeman
Suite 1900
401 North Michigan Avenue
Chicago, Illinois 60611
312/222-0800
312/222-0818 (FAX)
TO PURCHASER: John G. Brant
4251 Kipling Street
Suite 420
Wheatridge, CO 80033
303/431-6070
303/431-7667 (FAX)
subject to the right of either party to designate a different address for
itself by notice similarly given. Any notice or demand so given shall be
deemed to be delivered or made on the next business day if sent by overnight
courier, or on the same day if sent by facsimile before the close of business,
or the next day if sent by facsimile after the close of business, or on the 4th
business day after the same is deposited in the United States Mail as
registered or certified matter, addressed as above provided, with postage
thereon fully prepaid. Any such notice, demand or document not given,
delivered or made by registered or certified mail or by overnight courier or by
facsimile as aforesaid shall be deemed to be given, delivered or made upon
receipt of the same by the party to whom the same is to be given, delivered or
made. Copies of all notices shall be served upon the Escrow Agent.
20. EXECUTION OF AGREEMENT AND ESCROW AGREEMENT. Purchaser will execute three
(3) copies of this Agreement and three (3) copies of the Escrow Agreement and
forward them to Seller for execution, accompanied with the Earnest Money
payable to the Escrow Agent. Seller will forward one (1) copy of the executed
Agreement to Purchaser and will forward the following to the Escrow Agent:
(1) Earnest Money;
(2) One (1) fully executed copy of this Agreement; and
(3) Three (3) copies of the Escrow Agreement signed by the parties
with a direction to execute two (2) copies of the Escrow
Agreement and deliver a fully executed copy to the Purchaser and
the Seller.
21. GOVERNING LAW. The provision contained herein with reference to retention
of the Earnest Money in the event of Purchaser's default shall be governed by
the laws of the State of Illinois. The remaining provisions of this Agreement
shall be governed by the laws of the State of Colorado.
22. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement between
the parties and supersedes all other negotiations, understandings and
representations made by and between the parties and the agents, servants and
employees.
23. COUNTERPARTS. This Agreement may be executed in multiple counterparts,
each of which shall be deemed an original but all of which shall constitute one
and the same instrument.
24. CAPTIONS. Paragraph titles or captions contained herein are inserted as a
matter of convenience and for reference, and in no way define, limit, extend or
describe the scope of this Agreement or any provision hereof.
IN WITNESS WHEREOF, the parties hereto have put their hand and seal as of the
date set forth above.
Executed by Purchaser on PURCHASER:
12/16, 1993.
UNIVERSITY LAND CORP., a
Colorado corporation
By: /s/ John G. Brant
JOHN G. BRANT, President
Executed by Seller on SELLER:
12/17, 1993.
UNIVERSITY OFFICE LIMITED
PARTNERSHIP, an Illinois limited
partnership
By: University Office Partners,
Inc., an Illinois corporation
By: /s/ Phillip Schechter
/s/ Authorized Agent
