SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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): October 15, 1997
CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XIII
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(Exact name of registrant as specified in its charter)
Illinois 0-12791 36-3207212
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(State or other) (Commission (IRS Employer
Jurisdiction of File Number) Identification No.)
Organization
900 N. Michigan Avenue, Chicago, Illinois 60611-1575
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(Address of principal executive office)
Registrant's telephone number, including area code: (312) 915-1987
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<PAGE>
MICHAEL'S AURORA PLAZA (MARSHALL'S)
Aurora, Colorado
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS. On October 15, 1997,
Carlyle Real Estate Limited Partnership - XIII (the "Partnership") sold the
land, related improvements, and personal property of the Michael's Aurora
Plaza (Marshall's) (collectively, the "Property") located in Aurora,
Colorado. The purchaser, GDA Real Estate Services, L.L.C., a Colorado
limited liability company, is not affiliated with the Partnership or its
General Partners and the sale price was determined by arm's-length
negotiations. The Property primarily consists of a 123,000 square foot
shopping center. Occupancy at the Property was approximately 96% at the
date of sale.
The sale price of the Property (pursuant to a contract entered into in
August, 1997) was $6,885,000 (before selling costs, broker commissions and
prorations of approximately $524,000) all of which was paid in cash at
closing. The Partnership used a substantial portion of the proceeds to
repay the existing mortgage note of approximately $5,045,000 which was
originally scheduled to mature, as extended, June 2, 1997. The mortgage
note was extended by the lender on a short-term basis from June 2, 1997
through the date of closing with the annual interest rate increased to
9.375% through September 1, 1997 then reverting to the original 9.02% per
annum rate through the date of closing. The sale is expected to result in
a gain in 1997 to the Partnership of approximately $800,000 for financial
reporting purposes and approximately $4,200,000 for Federal income tax
purposes. In addition, in connection with the sale of this property and as
is customary in such transactions, the Partnership agreed to certain
representations and warranties, with a stipulated survival period which
expires June 15, 1998. Although it is not expected, the Partnership may
ultimately have some liability under such representations and warranties.
The Partnership Agreement provides that the General Partners shall
receive as a distribution of the proceeds (net after expenses and
liabilities and retained working capital) from the sale or refinancing of a
real property of up to 3% of the selling price of a property, and that the
remaining net proceeds for any property sold be distributed 85% to the
Holders of Interests and 15% to the General Partners. However, prior to
such distributions being made, the Holders of Interests are entitled to
receive 99% of net sale or refinancing proceeds and the General Partners
are entitled to receive 1% until the Holders of Interests (i) have received
cumulative cash distributions from the Partnership's operations which, when
combined with net sale or refinancing proceeds previously distributed,
equal a 6% annual return on the Holders' average capital investment for
each year (their initial capital investment as reduced by net sale or
refinancing proceeds previously distributed) and (ii) have received cash
distributions of net sale or refinancing proceeds in an amount equal to the
Holders' aggregate initial capital investment in the Partnership. If upon
the completion of the liquidation of the Partnership and the distribution
of all Partnership funds, the Holders of Interests have not received the
amounts in (i) and (ii) above, the General Partners will be required to
return all or a portion of the 1% distribution of net sale or refinancing
proceeds described above in an amount equal to such deficiency in payments
to the Holders of Interests pursuant to (i) and (ii) above. The Holders of
Interests have not received and are not expected to receive distributions
to the levels of (i) and (ii) above. Therefore, no portion of the sale
proceeds will be distributed to the General Partners at this time.
<PAGE>
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial Statements. Not applicable.
(b) Pro Forma Financial Information - Narrative.
As a result of the sale of the Property, after October 15,
1997, there will be no further rental income, mortgage and other interest,
property operating expenses or amortization of deferred expenses recorded
for the Property in the consolidated financial statements of the
Partnership. For the year ended December 31, 1996, the Property's
financial statements reflected rental income, mortgage and other interest,
property operating expenses and amortization of deferred expenses of
approximately $1,369,000, $457,000, $415,000 and $36,000, respectively.
Rental income, mortgage and other interest, property operating expenses and
amortization of deferred expenses relating to the Property included for the
six months ended June 30, 1997, in the Partnership's consolidated financial
statements were approximately $688,000, $223,000, $171,000 and $55,000,
respectively. Such operating results reflected the classification of the
Property as held for sale or disposition as of December 31, 1996, and
therefore, not subject to continued depreciation as of such date. Also, as
a result of the sale of the Property, there are no further assets and
liabilities related to the Property, which at June 30, 1997 consisted of
land, building and improvements (net of accumulated depreciation) of
approximately $5,810,000; accrued rents receivable of approximately
$51,000; deferred expenses of approximately $31,000; current liabilities of
approximately $5,336,000 and non-current liabilities of approximately
$31,000.
(c) Exhibits
10.1. Purchase Agreement and Joint Escrow Instructions
between Carlyle Real Estate Limited Partnership - XIII and GDA Real Estate
Services, Inc. dated August 4, 1997.
10.2. Letter agreement related to the Purchase Agreement
between Carlyle Real Estate Limited Partnership - XIII and GDA Real Estate
Services, Inc. dated September 3, 1997.
<PAGE>
SIGNATURES
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 thereunto duly authorized.
CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XIII
BY: JMB Realty Corporation
(Corporate General Partner)
By: GAILEN J. HULL
Gailen J. Hull
Senior Vice President
Principal Accounting Officer
Dated: October 30, 1997
EXHIBIT 10.1
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PURCHASE AGREEMENT AND JOINT ESCROW INSTRUCTIONS
(Michael's Aurora Plaza; Aurora, Colorado)
THIS AGREEMENT is made and entered into as of the _______ day of
August, 1997 (the "Effective Date"), by and between CARLYLE REAL ESTATE
LIMITED PARTNERSHIP-XIII, an Illinois limited partnership (hereinafter
called "Seller"), and GDA REAL ESTATE SERVICES, INC., a Colorado
corporation (hereinafter called "Buyer").
R E C I T A L S
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A. Seller is the owner of that certain real property located at
the northwest corner of Chambers Road and Mississippi Avenue, in Aurora,
Colorado, consisting primarily of a shopping center sometimes known as
"Michael's Aurora Plaza" (the "Premises").
B. Buyer desires to purchase, and Seller desires to sell, such
Premises on the terms and conditions hereinafter documented.
NOW, THEREFORE, in consideration of the mutual undertakings of the
parties hereto, it is hereby agreed as follows:
1. Purchase and Sale. Seller shall sell to Buyer, and Buyer shall
purchase from Seller, the land (the "Land") described in Exhibit "A"
attached hereto and made a part hereof, together with all right, title and
interest of Seller in and to all improvements, structures, easements and
rights of way, supplies, fixtures, water and water rights, coal, oil, gas
and other minerals located upon, or appurtenant to, the Land, all right,
title and interest of Seller in and to those items of personal property
described in Exhibit "B" attached hereto and made a part hereof, all right,
title and interest of Seller in and to the name "Michael's Aurora Plaza",
to the extent assignable, all right, title and interest of Seller in and to
all leases, contract rights, agreements, tenant lists, advertising material
and telephone exchange numbers, and all right, title and interest of Seller
in any public streets, roads, highways and alleys adjacent to the Property
(hereinafter, collectively, the "Property"), all upon the terms, covenants
and conditions hereinafter set forth.
2. Purchase Price. The purchase price (the "Purchase Price") for
the Property shall be the sum of $7,150,000.
3. Payment of Purchase Price. The Purchase Price shall be paid to
Seller by Buyer as follows:
A. Escrow Deposit. Concurrently herewith, Buyer shall deliver
$100,000 (the "Initial Escrow Deposit") to Chicago Title Insurance Company,
at its offices at 1875 Lawrence Street, Suite 1200, Denver, Colorado 80202
, Attention: Mej Ellsworth (which company, in its capacity as escrow
holder hereunder, is called "Escrow Holder"). In addition, if Buyer shall
deliver the "Approval Notice" prior to the expiration of the "Due Diligence
Period", as provided (and defined) in paragraph 4B hereof, Buyer shall
concurrently therewith deliver an additional deposit of $150,000 (the
"Additional Escrow Deposit") to Escrow Holder. Each deposit to be made
hereunder shall be made by Buyer delivering the applicable amount to Escrow
Holder by wire transfer of immediately available federal funds or by check
evidencing good funds and the amounts so deposited shall be held by Escrow
Holder as a deposit against the Purchase Price in accordance with the terms
and provisions of this Agreement. As used herein, the term "Escrow
Deposit" shall mean the Initial Escrow Deposit and, from and after the
deposit thereof, the Additional Escrow Deposit, together with all interest
earned on such deposits while the same are held by Escrow Holder hereunder.
The amounts deposited hereunder shall be held by Escrow Holder as a deposit
against the Purchase Price in accordance with the terms and provisions of
this Agreement. At all times that the Escrow Deposit is being held by the
Escrow Holder, the Escrow Deposit shall be invested by Escrow Holder in the
following investments ("Approved Investments"): (i) United States Treasury
obligations, (ii) United States Treasury-backed repurchase agreements
issued by a major money center banking institution reasonably acceptable to
Seller, or (iii) such other manner as may be reasonably agreed to by Seller
and Buyer. The Escrow Deposit shall be disposed of by Escrow Holder only
as provided in this Agreement.
B. Closing Payment. The balance of the Purchase Price, as
adjusted by the application of the Escrow Deposit and by the prorations and
credits specified herein, shall be paid in cash on the Closing Date (the
amount to be paid under this subparagraph B being herein called the
"Closing Payment").
4. Conditions Precedent.
A. Title Matters.
(1) Title Commitment. Seller has ordered (and upon receipt shall
deliver to Buyer ) an update of that certain commitment for title insurance
dated April 17, 1997 under No. ABC568975 (NBU File No. 970954) ("Title
Commitment") covering the Property from Chicago Title Insurance Company
(which company, in its capacity as title insurer hereunder, is herein
called the "Title Company"), together with copies of all exceptions to
title referenced thereto. In addition, Seller has delivered to Buyer a
survey of the Property dated May 21, 1997, prepared by Frasier & Halbe
Engineering Company, which survey shall be certified to Buyer and Title
Company ("Survey"). If Buyer shall fail to deliver written notice ("Title
Objection Notice") setting forth those title and survey matters to which
Buyer objects on or before the date which is fifteen (15) days after its
receipt of the Title Commitment and the Survey (the "Title Review Period"),
Buyer shall be deemed to have approved the exceptions to title shown on the
Preliminary Title Report and the matters disclosed on the Survey. Within
seven (7) days after Seller's receipt of Buyer's Title Objection Notice,
Seller shall inform Buyer whether the Seller shall, prior to the expiration
of the Due Diligence Period, cure those title and survey matters contained
in Buyer's Title Objection Notice (it being acknowledged by Buyer that
Seller shall not be obligated to expend any monies or execute any
affidavits or certificates in order to cure any of said title and survey
matters). Approval by Buyer of any additional exceptions to title or
survey matters disclosed after the end of the Title Review Period shall be
a condition precedent to Buyer's obligation to purchase the Property (Buyer
hereby agreeing that such approval shall not be unreasonably withheld).
Unless Buyer gives written notice that it disapproves any such additional
exceptions to title or survey matters, stating the exceptions so
disapproved, on or before the sooner to occur of 5 business days after
receipt of written notice thereof or the Closing Date, Buyer shall be
deemed to have approved said exceptions or survey matters. If for any
reason, on or before the Closing Date Seller does not cause such exceptions
to title or survey matters which Buyer disapproves (to the extent Buyer is
permitted hereunder to so disapprove) to be removed at no cost or expense
to Buyer (Seller having the right but not the obligation to do so), the
obligation of Seller to sell, and Buyer to buy, the Property as herein
provided shall terminate (and Seller and Buyer shall have no further
obligations in connection herewith). Buyer shall have the option to waive
the condition precedent set forth in this paragraph 4A(1) by notice to
Seller. In the event of such waiver, such condition shall be deemed
satisfied. All matters set forth on the Preliminary Title Report which are
not timely objected to by Buyer, are herein called the "Permitted
Exceptions". The term "Permitted Exceptions" shall additionally include
(i) any title matters objected to by Buyer, which objections are
subsequently waived in writing by Buyer, and (ii) any title matters
objected to by Buyer, which objections are cured to Buyer's satisfaction.
(2) Exceptions to Title. Buyer shall be obligated to accept title
to the Property, subject to the following exceptions to title:
(a) Real estate taxes and assessments not yet due and payable;
(b) The Permitted Exceptions.
Conclusive evidence of the availability of such title shall be the
willingness of Title Company to issue to Buyer on the Closing Date a
standard form ALTA owner's title insurance policy ("Owner's Policy"), in
the face amount of the Purchase Price, which policy shall (i) show title to
the Property to be vested of record in Buyer, and (ii) show the Permitted
Exceptions to be the only exceptions to title.
B. Due Diligence Reviews. Buyer shall have until 5:00 p.m.
(Central time) on the date that is thirty (30) days after the Effective
Date of this Agreement (the "Due Diligence Period") within which to
complete all of Buyer's due diligence examinations, reviews and inspections
of all matters pertaining to the purchase of the Property (other than the
title and survey reviews contemplated in paragraph A above), including all
leases, service contracts, and all physical, environmental and compliance
matters and conditions respecting the Property. During the Due Diligence
Period, Seller shall provide Buyer with reasonable access to the Property
upon reasonable advance notice. Buyer shall promptly commence, and shall
diligently and in good faith pursue, its due diligence review hereunder.
Buyer shall at all times conduct its due diligence review, inspections and
examinations in a manner so as to not cause damage, loss, cost or expense
to Seller or the Property and so as to not interfere with or disturb any
tenant at the Property, and Buyer will indemnify, defend, and hold Seller
and the Property harmless from and against any such damage, loss, cost or
expense (the foregoing obligation surviving any termination of this
Agreement). In no event shall Buyer (a) make any intrusive physical
testing (environmental, structural or otherwise) at the Property (such as
soil borings, water samplings or the like) without Seller's prior written
consent (and shall in all events promptly return the Property to its prior
condition and repair thereafter); (b) unless Seller or Seller's
representative is present, contact any tenant of the Property without
Seller's express written consent; or (c) contact any governmental authority
having jurisdiction over the Property without Seller's express written
consent (which consent will not be unreasonably withheld). So long as
Seller makes any such representative reasonably available (which Seller
agrees to do during normal business hours provided Buyer has given Seller
at least twenty-four (24) hours notice thereof), Seller shall have the
right, at its option, to cause a representative of Seller to be present at
all inspections, reviews and examinations conducted hereunder. At the
request of Seller, Buyer shall promptly deliver to Seller true, accurate
and complete copies of any written reports relating to the Property
prepared for or on behalf of Buyer by any third party (provided, however,
that the delivery thereof shall be without representation or warranty) and
in the event of termination hereunder, shall return all documents and other
materials furnished to or on behalf of Buyer by Seller hereunder. Buyer
shall keep all information or data received or discovered in connection
with any of the inspections, reviews or examinations confidential;
provided, however, that Buyer shall be entitled to disclose such
information to Buyer's attorneys, accountants, consultants and prospective
debt and equity financing sources who reasonably need to be informed in
connection with Buyer's determinations hereunder (and who shall, in turn,
be required to keep such information confidential). If, on or before the
expiration of the Due Diligence Period, Buyer shall determine that it
intends to proceed with the acquisition of the Property, then Buyer shall
promptly notify Seller and Escrow Holder of such determination in writing
(such notice being herein called the "Approval Notice"), and concurrently
therewith deliver the Additional Escrow Deposit as provided in paragraph 3A
hereof, and thereafter, Buyer shall have no further right to terminate this
Agreement pursuant to this paragraph 4B. If, however, on or before the
expiration of the Due Diligence Period, (i) Buyer shall determine that it
no longer intends to acquire the Property (in which case Buyer shall
promptly notify Seller regarding such determination), or (ii) if Buyer
shall fail to deliver the Approval Notice and the Additional Escrow Deposit
on or before the expiration of the Due Diligence Period pursuant to this
Agreement (in which case Buyer shall be deemed to have determined that it
no longer intends to acquire the Property), this Agreement, and the
obligations of the parties, shall terminate and the Escrow Deposit shall be
returned to Buyer.
C. Estoppel Certificates. Receipt of estoppel certificates dated
not more than 30 days prior to the Closing Date from (i) tenants listed on
Exhibit "C-1" attached hereto and made a part hereof (the "Required
Tenants"), and (ii) from a sufficient number of the balance of the tenants
at the Property so that estoppel certificates shall be received under
clauses (i) and (ii) hereof with respect to not less than 85% of the gross
leasable area, in the aggregate, covered by leases at the Property in
effect as of the date hereof, is a condition precedent to Buyer's
obligation to purchase the Property hereunder. The estoppel certificates
to be obtained from each tenant shall be substantially in the form of
Exhibit "C-2" attached hereto and made a part hereof; provided, however,
(i) with respect to any major national tenant, the applicable estoppel
certificate may be in the standard form otherwise required by such entity
so long as the information therein does not then materially conflict with
the List of Leases, and (ii) if the applicable tenant lease limits the
information required to be certified by the tenant, then an estoppel
certificate setting forth only such required information shall be deemed
acceptable so long as the information therein does not then materially
conflict with the List of Leases. Seller's sole obligation hereunder shall
be to utilize reasonable efforts to obtain such estoppel certificates (such
reasonable efforts obligation not including any obligation to institute
legal proceedings or to expend any monies therefor, other than for minor
administrative charges incurred by Seller). Buyer shall have the option to
waive the condition precedent set forth herein by notice to Seller
(whereupon such condition will be deemed satisfied). In the event that
prior to the Closing Date such condition is not satisfied (or waived as
aforesaid), the obligations of Seller to sell, and Buyer to purchase, the
Property hereunder shall terminate, and the Escrow Deposit shall be
returned to Buyer. In addition, Seller shall deliver, and it shall be a
condition precedent to Buyer's obligation to close hereunder that, as of
the Closing Date, Buyer shall have received an estoppel certificate
addressed to Buyer from Seller with respect to those tenants which fail to
deliver tenant estoppel certificates ("Seller's Estoppel Certificates")
certifying or noting any exceptions to the following: that the applicable
lease is in full force and effect, that a true and complete copy of the
applicable lease is attached to the applicable Seller's Estoppel
Certificate; that neither the tenant nor the landlord under the applicable
lease is in default thereunder; that the Seller's Estoppel Certificate
states the present amount of annual base rent being paid by the tenant
under the applicable lease and the commencement and termination dates under
the applicable lease; that no prepayments of rentals due under the
applicable lease have been made more than one (1) month in advance; that
all items required to have been constructed or installed by landlord under
the applicable lease have been completed in accordance with any applicable
plans and specifications and within the time periods set forth in the
applicable lease; that, to Seller's knowledge, the applicable tenant has
not assigned, sublet or transferred its interest in the applicable lease or
the premises covered thereunder; and that, to Seller's knowledge, the
applicable tenant has no defense or offset against the landlord under the
applicable lease; provided, however, that in no event shall Seller be
obligated to deliver Seller's Estoppel Certificates (x) with respect to
leases covering more than 20% of the gross leasable area, in the aggregate,
as of the date hereof, or (y) with respect to Michael's of Aurora lease. A
Seller's Estoppel Certificate shall be of no further force and effect as to
any tenant which delivers an Tenant Estoppel Certificate subsequent to
Seller's delivery of the Seller's Estoppel Certificates to Buyer, provided
such Tenant Estoppel Certificate is consistent in all material respects
with the information with respect to such tenant contained in the
applicable Seller's Estoppel Certificate previously delivered to Buyer and
the "List of Leases" (as hereinafter defined). Notwithstanding the
foregoing, in the event that Buyer's lender requires additional estoppel
certificates and/or subordination agreements, Seller will reasonably
cooperate with Buyer and reasonably attempt to secure the same from the
tenants at the Property; provided, however, that such reasonable efforts
obligation does not include any obligation to institute legal proceedings
or to expend any monies therefor; and provided further, however, that
receipt by Buyer or its lender of such additional estoppel certificates
and/or subordination agreements shall in no event be a condition precedent
to Buyer's obligation to close the transactions contemplated hereunder.
D. Performance by Seller. The performance and observance, in all
material respects, by Seller of all covenants and agreements of this
Agreement to be performed or observed by Seller prior to or on the Closing
Date shall be a condition precedent to Buyer's obligation to purchase the
Property. In addition, in the event that the "Seller Closing Certificate"
(as hereinafter defined) shall disclose any material adverse changes in the
representations and warranties of Seller contained in paragraph 7A below
which are not otherwise permitted or contemplated by this Agreement, then
Buyer shall have the right to terminate this Agreement and the Escrow
Deposit shall be returned to Buyer. Buyer shall have the option to waive
the condition precedent set forth in this paragraph 4D by written notice to
Seller. In the event of such waiver, such condition shall be deemed
satisfied.
E. Performance by Buyer. The performance and observance, in all
material respects, by Buyer of all covenants and agreements of this
Agreement to be performed or observed by it prior to or on the Closing Date
shall be a condition precedent to Seller's obligation to sell the Property.
In addition, in the event that the "Buyer Closing Certificate" (as
hereinafter defined) shall disclose any material adverse changes in the
representations and warranties of Buyer contained in paragraph 7B below
which are not permitted or contemplated by this Agreement, then Seller
shall have the right to terminate this Agreement. Seller shall have the
option to waive the condition precedent set forth in this paragraph 4E by
written notice to Buyer. In the event of such waiver, such condition shall
be deemed satisfied.
5. Closing Procedure Transactions. The sale and purchase herein
provided shall be consummated at a closing conference ("Closing
Conference"), which shall be held on the Closing Date either at Buyer's
counsel's offices, or through mutually agreeable escrow arrangements. As
used herein, "Closing Date" means the date that is thirty (30) days after
the expiration of the Due Diligence Period, or such earlier date as may be
agreed upon by Buyer and Seller in writing.
A. Escrow. On or before the Closing Date, the parties shall
deliver to Title Company, at its office located at 700 South Flower Street,
Los Angeles, California, the following: (1) by Seller, a duly executed and
acknowledged original special warranty deed ("Deed") in favor of Buyer, in
the form of Exhibit "D" attached hereto and made a part hereof, and (2) by
Buyer, the Closing Payment in immediately available federal funds. Such
deliveries shall be made pursuant to escrow instructions ("Escrow
Instructions") to be executed among Buyer, Seller and Title Company in form
reasonably acceptable to such parties in order to effectuate the intent
hereof. The conditions to the closing of such escrow shall include the
Title Company's receipt of the Deed, the Closing Payment, the commitment of
the Title Company to issue the Owner's Policy in the form specified in
paragraph 4A(2) hereof, and an authorization notice from each of Buyer and
Seller (and each of Buyer and Seller shall be obligated to deliver such
authorization notice at the Closing Conference as soon as it is reasonably
satisfied that the other party is in a position to deliver the items to be
delivered by such other party under subparagraph B below).
B. Delivery to Parties. Upon full satisfaction of the conditions
set forth in the Escrow Instructions, then on the Closing Date (1) the Deed
shall be delivered to Buyer by Title Company's depositing the same for
recordation, (2) the Closing Payment (and the Escrow Deposit) shall be
delivered to Seller and (3) at the Closing Conference, the following items
shall be delivered:
(1) Seller Deliveries. Seller shall deliver to Buyer the
following:
(a) A duly executed and acknowledged bill of sale, assignment and
assumption agreement ("Assignment and Assumption Agreement") in the form of
Exhibit "E" attached hereto and made a part hereof;
(b) A certificate of Seller ("Seller Closing Certificate") updating
the representations and warranties contained in paragraph 7A hereof to the
Closing Date and noting any changes thereto;
(c) Duly executed and acknowledged certificates regarding the "non-
foreign" status of Seller satisfying both federal and state law
requirements;
(d) Evidence reasonably satisfactory to Buyer and Escrow Holder
respecting the due organization of Seller and the due authorization and
execution of this Agreement and the documents required to be delivered
hereunder; and
(e) Such additional documents as may be reasonably required by
Buyer and Title Company in order to consummate the transactions hereunder
(provided the same do not increase the costs to, or liability or
obligations of, Seller in a manner not otherwise provided for herein).
(2) Buyer Deliveries. Buyer shall deliver to Seller the following:
(a) A duly executed and acknowledged Assignment and Assumption
Agreement;
(b) A certificate of Buyer ("Buyer Closing Certificate") updating
the representations and warranties contained in paragraph 7B hereof to the
Closing Date and noting any changes thereto;
(c) Evidence reasonably satisfactory to Seller and Escrow Holder
respecting the due organization of Buyer and the due authorization and
execution of this Agreement and the documents required to be delivered
hereunder; and
(d) Such additional documents as may be reasonably required by
Seller and Title Company in or to consummate the transactions hereunder
(provided the same do not increase the costs to, or liability or
obligations of, Buyer in a manner not otherwise provided for herein).
C. Closing Costs. Seller shall pay the documentary or transfer
taxes attributable to the Deed, and the title insurance premiums (at a rate
not in excess of standard issue rates) attributable to standard coverage
respecting the Owner's Policy, for any endorsements to the Owner's Policy
necessary to eliminate a lien or liens which Seller is obligated to
pursuant to paragraph 4A(1) above, and the cost of the Survey. Buyer shall
pay all title insurance premiums attributable to the Owner's Policy in
excess of standard coverage, as well as any costs attributable to ALTA
coverage in connection therewith or for other so-called "extended coverage"
or for any endorsements to the Owner's Policy (other than those
endorsements to the Owner's Policy necessary to eliminate a lien or liens
which Seller is obligated to eliminate pursuant to paragraph 4A(1) above),
to the extent any of the foregoing is requested by Buyer, all costs and
expenses related to Buyer's due diligence examinations, reviews and
inspections, all costs and expenses of any financing which Buyer may obtain
in connection with its acquisition, all recording fees for the Deed, and
all intangible, sales or use taxes attributable to the transactions
hereunder. Seller and Buyer shall each pay one-half of any closing escrow
charges. Seller and Buyer shall each pay its own attorney's fees and
expenses and its own respective shares of prorations as hereinafter
provided.
D. Prorations.
(1) Items to be Prorated. The following shall be prorated between
Seller and Buyer as of the Closing Date:
(a) Taxes. All real estate taxes and assessments on the Property
for the current year shall be prorated on the Closing Date based on the
most recent assessment and mill levy information available. In no event
shall Seller be charged with or be responsible for any increase in the
taxes on the Property resulting from the sale of the Property or from any
improvements made or leases entered into on or after the Closing Date. In
the event that any assessments on the Property are payable in installments,
then the installment for the current period shall be prorated (with Buyer
assuming the obligation to pay any installments due after the Closing
Date).
(b) Rents. All fixed and additional rentals under the Leases, and
other tenant charges. Seller shall deliver or provide a credit in an
amount equal to all prepaid rentals for periods after the Closing Date (to
the extent not applied or forfeited prior to the Closing Date) to Buyer on
the Closing Date. Rents which are delinquent as of the Closing Date shall
not be prorated on the Closing Date. Buyer shall include such
delinquencies in its normal billing and shall use commercially reasonable
efforts to collect the same for a period of ninety (90) days after the
Closing Date (but Buyer shall not be required to litigate or declare a
default in any lease). To the extent Buyer receives rents (other than
"Additional Amounts", as hereinafter defined) on or after the Closing Date,
such payments shall be applied first toward then current rent owed to Buyer
in connection with the applicable lease for which such payments are
received, and finally toward any excess monies received shall be applied
toward the payment of any delinquent rents, with Seller's share thereof
being promptly delivered to Seller. Until the date that is ninety (90)
days after the Closing Date, Buyer may not waive any delinquent rents nor
modify a lease so as to reduce or otherwise affect amounts owed thereunder
for any period in which Seller is entitled to receive a share of charges or
amounts without first obtaining Seller's written consent. Common area
charges, taxes, operating expense and other similar expense reimbursement
obligations of the tenants under the Leases, as well as any percentage
payable thereunder (collectively, "Additional Amounts") shall be prorated
effective as of the Closing Date. The parties will finalize such
Additional Amounts prorations on the Closing Date or as soon as practicable
thereafter (but in any event not later than December 15, 1997). Proration
of expense items contained in the calculation of the Additional Amounts
shall be made on the basis that Seller shall be entitled to reimbursement
of the applicable expenses paid by Seller (annualized or otherwise
appropriately apportioned) prior to the Closing Date. To the extent that,
based on such determinations, Seller has received amounts in excess of the
amount due Seller, then Seller shall deliver such excess amount to Buyer on
the Closing Date (or if determined thereafter, then within 15 days of such
determination). To the extent that Seller has received an amount less than
the amount so due, Buyer shall deliver such shortfall amount to Seller on
the Closing Date (or if determined thereafter, then within 15 days of such
determination). The amount of percentage rent to be allocated to Seller
with respect to each Tenant Lease for the lease year (the "Current Lease
Year") in which the Closing Date occurs shall be that amount equal to (i)
the amount by which (A) the tenant's gross receipts (to the extent taken
into account in determining percentage rent under such Tenant Lease) for
that portion of such Current Lease Year occurring prior to the Closing Date
exceed (B) the "Allocable Base Amount", multiplied by (ii) the percentage
specified in such Tenant Lease to be used in determining such tenant's
percentage rent for such Current Lease Year. The "Allocable Base Amount"
means that portion of the "Base Amount" for such Current Lease Year
determined by multiplying such Base Amount for the entire Current Lease
Year by a fraction, the numerator of which is the number of days in such
Current Lease Year occurring prior to the Closing Date and the denominator
of which is the number of days of such Current Lease Year. "Base Amount"
is the amount specified in each Tenant Lease for such Current Lease Year
that must be exceeded by the sales of the tenant during such Current Lease
Year before such tenant shall be obligated thereunder to pay percentage
rent for such Current Lease Year. Buyer shall not be obligated to pay or
credit Seller any sum on account of the proration of percentage rent as
aforesaid unless and until the percentage rent to be prorated as aforesaid
shall be received by Buyer. With respect to delinquent rents, Additional
Amounts and any other amounts or other rights of any kind respecting
tenants who are no longer tenants of the Property as of the Closing Date,
Seller shall retain all rights relating thereto.
(c) Security Deposits. Seller shall deliver or provide a
credit in an amount equal to all refundable security deposits (to the
extent the foregoing are held by Seller and are not applied or forfeited
prior to the Closing Date) to Buyer on the Closing Date.
(d) Utility and Operating Expenses. All utility costs and other
normal and customary operating expenses in connection with the Property.
(2) Calculation. The prorations and payments shall be made on the
basis of a written statement submitted to Buyer and Seller by Escrow Holder
prior to the Close of Escrow and approved by Buyer and Seller. In the
event any prorations or apportionments made under this subparagraph D shall
prove to be incorrect for any reason, then any party shall be entitled to
an adjustment to correct the same. Any item which cannot be finally
prorated because of the unavailability of information shall be tentatively
prorated on the basis of the best data then available and reprorated when
the information is available. The obligations of Seller and Buyer under
this paragraph 5D(2) shall survive the closing until December 15, 1997 (and
all reprorations hereunder shall be finalized prior to such date).
6. Condemnation or Destruction of Property. In the event that,
after the date hereof but prior to the Closing Date, either any portion of
the Property is taken pursuant to eminent domain proceedings or any of the
improvements on the Property are damaged or destroyed by any casualty,
Seller shall have no obligation to repair or replace any such damage or
destruction. Seller shall, upon consummation of the transaction herein
provided, assign to Buyer all claims of Seller respecting any condemnation
or casualty insurance coverage, as applicable, and all condemnation
proceeds or proceeds from any such casualty insurance received by Seller on
account of any casualty (the damage from which shall not have been repaired
by Seller prior to the Closing Date), as applicable. In connection with
any assignment of insurance proceeds hereunder, Seller shall credit Buyer
with an amount equal to the applicable deductible amount under Seller's
insurance. In the event the condemnation award or the cost of repair of
damage to the Property on account of a casualty, as applicable, shall
exceed $50,000 (or if a casualty is uninsured, and Seller does not elect to
credit Buyer with an amount equal to the cost to repair such uninsured
casualty, Seller having the right, but not the obligation, to do so), or if
a tenant occupying more than 2,500 square feet is permitted to terminate
its lease as a result of such condemnation or casualty, Buyer may, at its
option, terminate this Agreement by notice to Seller, given on or before
the Closing Date and receive a refund of the Escrow Deposit.
7. Representations and Warranties.
A. Representations and Warranties of Seller.
(1) General Disclaimer. Except as specifically set forth in
paragraph 7A(2) below or in the documents delivered by Seller at closing
pursuant to paragraph 5B(1) hereof, the sale of the Property hereunder is
and will be made on an "as is" basis, without representations and
warranties of any kind or nature, express, implied or otherwise, including,
but not limited to, any representation or warranty concerning title to the
Property, the physical condition of the Property (including, but not
limited to, the condition of the soil or the Improvements), the
environmental condition of the Property (including, but not limited to, the
presence or absence of hazardous substances on or respecting the Property),
the compliance of the Property with applicable laws and regulations
(including, but not limited to, zoning and building codes or the status of
development or use rights respecting the Property), the financial condition
of the Property or any other representation or warranty respecting income,
expenses, charges, liens or encumbrances, rights or claims on, affecting or
pertaining to the Property or any part thereof. Buyer acknowledges that,
during the Due Diligence Period, Buyer will examine, review and inspect all
matters which in Buyer's judgment bear upon the Property and its value and
suitability for Buyer's purposes. Except as to matters specifically set
forth in paragraph 7A(2) below or in the documents delivered by Seller at
closing pursuant to paragraph 5B(1) hereof, Buyer will acquire the Property
solely on the basis of its own physical and financial examinations, reviews
and inspections and the title insurance protection afforded by the Owner's
Policy. Without limitation thereon, Buyer hereby waives any and all rights
of contribution or other rights or remedies against Seller under the
Comprehensive Environmental Response, Compensation and Liability Act or any
other applicable environmental laws, rules or regulations.
(2) Limited Representations and Warranties of Seller. Seller
hereby represents and warrants to Buyer that, except as set forth in
Exhibit "F" attached hereto and made a part hereof, Seller has no knowledge
that any of the following statements is untrue (and, for this purpose,
Seller's knowledge shall mean only the present actual knowledge of Brian
Ellison (after having made inquiry of Seller's third party property manager
with respect to the representations and warranties contained in this
Agreement, but otherwise without any duty to investigate and with any
imputed or constructive notice being excluded)):
(a) List of Leases. Attached as Exhibit "G" and made a part hereof
is a true, complete and accurate list, as of the date thereof, of all
tenant leases respecting the Property ("List of Leases"), and Seller is not
in monetary default or material non-monetary default under any of such
tenant leases that remains uncured. Notwithstanding anything to the
contrary contained herein, Seller shall have no obligation or liability to
Buyer with respect to any of the foregoing matters which shall be confirmed
as correct in any tenant estoppel certificate which may be delivered
hereunder.
(b) Litigation. There is no pending action, litigation,
condemnation or other proceeding against the Property or against Seller (or
any of its partners or principals) with respect to the Property.
(c) Compliance. The Property is in compliance with applicable laws
and ordinances and Seller has received no written notice from any
governmental authority having jurisdiction over the Property to the effect
that the Property is not in compliance with applicable laws and ordinances.
(d) Service Agreements. Other than those which are cancelable on
30 days' notice without payment of any fees, there are no service
agreements or contracts ("Service Agreements") or other agreements (other
than as expressly set forth in this Agreement) relating to the Property
which will be in force on the Closing Date, except as described in
Exhibit "H" attached hereto and made a part hereof, and Seller is not in
monetary default or material non-monetary default thereunder that remains
uncured.
(e) Due Authority. This Agreement and all agreements, instruments
and documents herein provided to be executed or to be caused to be executed
by Seller are and on the Closing Date will be duly authorized, executed and
delivered by and are binding upon Seller. Seller is a limited partnership,
duly organized and validly existing under the laws of the State of
Illinois, and is duly authorized and qualified to do all things required of
it under this Agreement. Seller has the legal capacity and authority to
enter into this Agreement and consummate the transactions herein provided
without the consent or joinder of any other party (except as otherwise set
forth in this Agreement).
(f) Environmental Matters. Except as set forth in the reports
described in Exhibit "I" attached hereto and made a part hereof (the
"Environmental Reports"), Seller has received no written notice of the
existence, deposit, storage, removal, burial or discharge of any material
known to Seller to be a "Hazardous Material" at, upon, under or within the
Property, in an amount which, in Seller's reasonable judgment, would, as of
the date hereof, give rise to an "Environmental Compliance Cost". The term
"Hazardous Material" shall mean (i) asbestos and any chemicals, flammable
substances or explosives, any radioactive materials (including radon), any
hazardous wastes or substances which have, as of the date hereof, been
determined by any applicable Federal, State or local government law to be
hazardous or toxic by the U.S. Environmental Protection Agency, the U.S.
Department of Transportation, and/or any instrumentality now or hereafter
authorized to regulate materials and substances in the environment which
has jurisdiction over the Property ("Environmental Agency"), and (ii) any
oil, petroleum or petroleum derived substance, any drilling fluids,
produced waters and other wastes associated with the exploration,
development or production of crude oil, which materials listed under items
(i) and (ii) above cause the Property (or any part thereof) to be in
material violation of any applicable environmental laws or the regulations
of any Environmental Agency; provided, however, that the term "Hazardous
Material" shall not include motor oil and gasoline contained in or
discharged from vehicles not used primarily for the transport of motor oil
or gasoline. The term "Environmental Compliance Cost" means any reasonable
out-of-pocket cost, fee or expense incurred directly to satisfy any
requirement imposed by an Environmental Agency to bring the Property into
compliance with applicable Federal, State and local laws and regulations
directly relating to the existence on the Property of any Hazardous
Material. Buyer hereby acknowledges that it is acquiring the Property
subject to the matters disclosed in the Environmental Reports, and Buyer
shall at Closing, assume the obligations for, and release Seller from any
liability relating to (whether under local, State or Federal law), any
matters disclosed in the Environmental Reports.
B. Representations and Warranties of Buyer. Buyer represents and
warrants to Seller as follows: This Agreement and all agreements,
instruments and documents herein provided to be executed or to be caused to
be executed by Buyer are and on the Closing Date will be duly authorized,
executed and delivered by and are binding upon Buyer; Buyer is a
corporation, duly organized and validly existing and in good standing under
the laws of the State of Colorado, and is duly authorized and qualified to
do all things required of it under this Agreement; and Buyer has the legal
capacity and authority to enter into this Agreement and consummate the
transactions herein provided without the consent or joinder of any other
party (except as otherwise set forth in this Agreement).
C. Survival. Any cause of action of a party for a breach of the
foregoing representations and warranties shall survive until June 15, 1997,
at which time such representations and warranties (and any cause of action
resulting from a breach thereof not then in litigation) shall terminate.
Notwithstanding the foregoing, if Buyer shall have actual knowledge as of
the Closing Date that any of the representations or warranties of Seller
contained herein are false or inaccurate or that Seller is in breach or
default of any of its obligations under this Agreement, and Buyer
nonetheless closes the transactions hereunder and acquires the Property,
then Seller shall have no liability or obligation respecting such false or
inaccurate representations or warranties or other breach or default (and
any cause of action resulting therefrom shall terminate upon such closing
hereunder).
8. Interim Covenants of Seller. Until the Closing Date or the
sooner termination of this Agreement:
A. Seller shall maintain the Property in the same manner as prior
hereto pursuant to its normal course of business (such maintenance
obligations not including extraordinary capital expenditures or
expenditures not incurred in such normal course of business), subject to
reasonable wear and tear and further subject to destruction by casualty or
other events beyond the control of Seller.
B. Seller shall not enter into any additional service contracts or
other similar agreements without the prior consent of Buyer, except those
deemed reasonably necessary by Seller which are cancelable on 30 days'
notice (and Seller shall promptly provide Buyer with copies of all such
additional service contracts).
C. Seller shall continue to offer the Property for lease in the
same manner as prior hereto pursuant to its normal course of business and
shall keep Buyer reasonably informed as to the status of leasing prior to
the Closing Date. After the expiration of the date hereof, Seller shall
not enter into any new leases or modifications or terminations of existing
leases thereafter without the consent of Buyer (which consent will not be
unreasonably withheld or materially delayed). Notwithstanding anything
herein to the contrary, Seller shall have no obligation to enter into any
new leases or modifications of existing leases unless Buyer shall agree to
pay all tenant improvement costs, leasing commissions and other similar
costs or expenses in connection therewith (Buyer agreeing not to
unreasonably withhold or unduly delay any such approval if requested by
Seller).
9. DISPOSITION OF DEPOSITS. IF THE TRANSACTION HEREIN PROVIDED
SHALL NOT BE CLOSED BY REASON OF SELLER'S DEFAULT UNDER THIS AGREEMENT OR
THE FAILURE OF SATISFACTION OF THE CONDITIONS DESCRIBED IN PARAGRAPH 4
HEREOF OR THE TERMINATION OF THIS AGREEMENT IN ACCORDANCE WITH PARAGRAPH 6
HEREOF, THEN THE ESCROW DEPOSIT SHALL BE RETURNED TO BUYER, AND NEITHER
PARTY SHALL HAVE ANY FURTHER OBLIGATION OR LIABILITY TO THE OTHER;
PROVIDED, HOWEVER, IF THE TRANSACTIONS HEREUNDER SHALL FAIL TO CLOSE SOLELY
BY REASON OF A MATERIAL DEFAULT BY SELLER, BUYER SHALL HAVE PERFORMED ITS
MATERIAL OBLIGATIONS HEREUNDER SUCH THAT BUYER IS NOT IN DEFAULT HEREUNDER,
THEN BUYER SHALL BE ENTITLED TO SPECIFICALLY ENFORCE THIS AGREEMENT (BUT NO
OTHER ACTION, FOR DAMAGES OR OTHERWISE, SHALL BE PERMITTED; PROVIDED,
HOWEVER, THAT BUYER SHALL BE ENTITLED TO RECOVER ITS REASONABLE ATTORNEYS'
FEES EXPENDED IN CONNECTION WITH THE SPECIFIC PERFORMANCE ACTION PERMITTED
AS AFORESAID). IN THE EVENT THE TRANSACTION HEREIN PROVIDED SHALL NOT
CLOSE BY REASON OF BUYER'S DEFAULT UNDER THIS AGREEMENT, THEN THE ESCROW
DEPOSIT SHALL BE DELIVERED TO SELLER AS FULL COMPENSATION AND LIQUIDATED
DAMAGES UNDER AND IN CONNECTION WITH THIS AGREEMENT. IN THE EVENT THE
TRANSACTION HEREIN PROVIDED SHALL CLOSE, THE ESCROW DEPOSIT SHALL BE
APPLIED AS A PARTIAL PAYMENT OF THE PURCHASE PRICE. IN CONNECTION WITH THE
FOREGOING, THE PARTIES RECOGNIZE THAT SELLER WILL INCUR EXPENSE IN
CONNECTION WITH THE TRANSACTION CONTEMPLATED BY THIS AGREEMENT AND THAT THE
PROPERTY WILL BE REMOVED FROM THE MARKET; FURTHER, THAT IT IS EXTREMELY
DIFFICULT AND IMPRACTICABLE TO ASCERTAIN THE EXTENT OF DETRIMENT TO SELLER
CAUSED BY THE BREACH BY BUYER UNDER THIS AGREEMENT AND THE FAILURE OF THE
CONSUMMATION OF THE TRANSACTION CONTEMPLATED BY THIS AGREEMENT OR THE
AMOUNT OF COMPENSATION SELLER SHOULD RECEIVE AS A RESULT OF BUYER'S BREACH
OR DEFAULT. IN THE EVENT THE SALE OF THE PROPERTY SHALL NOT BE CONSUMMATED
ON ACCOUNT OF BUYER'S DEFAULT, THEN THE RETENTION OF THE ESCROW DEPOSIT
SHALL BE SELLER'S SOLE AND EXCLUSIVE REMEDY UNDER THIS AGREEMENT BY REASON
OF SUCH DEFAULT, SUBJECT TO THE PROVISIONS OF PARAGRAPH 10I HEREOF.
-------------------- --------------------
Seller's Initials Buyer's Initials
10. Miscellaneous.
A. Brokers.
(1) Except as provided in subparagraph (2) below, Seller represents
and warrants to Buyer, and Buyer represents and warrants to Seller, that no
broker or finder has been engaged by it, respectively, in connection with
any of the transactions contemplated by this Agreement or to its knowledge
is in any way connected with any of such transactions. In the event of a
claim for broker's or finder's fee or commissions in connection herewith,
then Seller shall indemnify and defend Buyer from the same if it shall be
based upon any statement or agreement alleged to have been made by Seller,
and, except for any claims by Broker which are Seller's responsibility
hereunder, Buyer shall indemnify and defend Seller from the same if it
shall be based upon any statement or agreement alleged to have been made by
Buyer. The indemnification obligations under this paragraph 10 A shall
survive the closing of the transactions hereunder or the earlier
termination of this Agreement.
(2) If and only if the sale contemplated herein closes, Seller
agrees to pay a brokerage commission to Richard Ellis, LLC, which shall, in
turn, be obligated to share a portion of such commission with CB Commercial
Real Estate Group (the foregoing brokers being herein collectively called
the "Brokers") pursuant to separate written agreements among the Brokers
and Seller. The foregoing payments shall be the sole commissions, fees or
payments payable to the Brokers in connection with the transactions
hereunder.
B. Limitation of Liability.
(1) Notwithstanding anything to the contrary contained herein, if
the closing of the transactions hereunder shall have occurred (and Buyer
shall not have waived, relinquished or released any applicable rights in
further limitation), the aggregate liability of Seller arising pursuant to
or in connection with or related in any manner to the Property (including,
without limitation, the representations, warranties, indemnifications,
covenants or other obligations, whether express or implied, of Seller under
this Agreement or any document executed or delivered in connection
herewith) shall not exceed $500,000.
(2) No constituent partner in or agent of Seller, nor any advisor,
trustee, director, officer, employee, beneficiary, shareholder,
participant, representative or agent of any corporation or trust that is or
becomes a constituent partner in Seller (including, but not limited to,
JMB Realty Corporation and the individual(s) specified in paragraph 7A(2)
above) shall have any personal liability, directly or indirectly, under or
in connection with this Agreement or any agreement made or entered into
under or pursuant to the provisions of this Agreement, or any amendment or
amendments to any of the foregoing made at any time or times, heretofore or
hereafter, and Buyer and its successors and assigns and, without
limitation, all other persons and entities, shall look solely to Seller's
assets for the payment of any claim or for any performance, and Buyer, on
behalf of itself and its successors and assigns, hereby waives any and all
such personal liability. Notwithstanding anything to the contrary
contained in this Agreement, neither the negative capital account of any
constituent partner in Seller (or in any other constituent partner of
Seller), nor any obligation of any constituent partner in Seller (or in any
other constituent partner of Seller) to restore a negative capital account
or to contribute capital to Seller (or to any other constituent partner of
Seller), shall at any time be deemed to be the property or an asset of
Seller or any such other constituent partner (and neither Buyer nor any of
its successors or assigns shall have any right to collect, enforce or
proceed against or with respect to any such negative capital account of
partner's obligation to restore or contribute).
(3) Notwithstanding the foregoing, (i) if Seller or its
successor-in-interest shall fail to retain reserves of at least $600,000 at
the time of closing hereunder or (ii) if during the period commencing on
the Closing Date and ending on June 15, 1998 (the "Survival Period"),
Seller or its successor-in-interest shall utilize such reserves for any
purpose other than the payment of claims, expenses, liabilities or
attorneys' fees of Seller or such successor-in-interest (including any
amounts incurred in connection with resolving or defending any claim of
liability hereunder) with respect to a breach or alleged breach of the
representations, warranties, indemnifications, covenants or other
obligations (whether express or implied) of Seller under this Agreement (or
any document executed or delivered in connection herewith), or is otherwise
related to, connected with or concerns the Property in any manner
(collectively, the "Specified Liabilities"), then subject to the terms and
conditions of this Agreement, Buyer may, during the Survival Period, look
to the assets of JMB Realty Corporation, as the general partner of Seller,
for the payment of any Specified Liabilities; provided, however, the
aggregate liability of JMB Realty Corporation in connection therewith shall
not exceed $500,000 in the aggregate and shall be further limited as
follows:
(i) with respect to the initial reserve amount, such
liability shall be limited to the lesser of the amount by which $600,000
exceeds the amount actually reserved by Seller or its successor-in-interest
in closing hereunder, and $500,000; or
(ii) during the Survival Period, such liability shall be
limited to the lesser of the amount of such reserves which, during the
Survival Period, are utilized for purposes other than the payment of the
Specified Liabilities, and $500,000.
C. Entire Agreement. This Agreement contains the entire agreement
between the parties respecting the matters herein set forth and supersedes
all prior agreements between the parties hereto respecting such matters.
This Agreement may not be modified or amended except by written agreement
signed by both parties.
D. Time of the Essence. Time is of the essence of this Agreement.
E. Interpretation. Paragraph headings shall not be used in
construing this Agreement. Each party acknowledges that such party and its
counsel, after negotiation and consultation, have reviewed and revised this
Agreement. As such, the terms of this Agreement shall be fairly construed
and the usual rule of construction, to the effect that any ambiguities
herein should be resolved against the drafting party, shall not be employed
in the interpretation of this Agreement or any amendments, modifications or
exhibits hereto or thereto.
F. Governing Law. This Agreement shall be construed and enforced
in accordance with the laws of the State of Colorado.
G. Successors and Assigns. Buyer may not assign or transfer its
rights or obligations under this Agreement without the prior written
consent of Seller (in which event such transferee shall assume in writing
all of the transferor's obligations hereunder, but such transferor shall
not be released from its obligations hereunder); provided, however, Buyer
may assign its interest in this Agreement to a limited partnership or
limited liability company in which Buyer is the managing general partner or
managing member, as appropriate, and has not less than a 51% interest in
capital and profits in such limited partnership or limited liability
company. No consent given by Seller to any transfer or assignment of
Buyer's rights or obligations hereunder shall be construed as a consent to
any other transfer or assignment of Buyer's rights or obligations
hereunder. No transfer or assignment in violation of the provisions hereof
shall be valid or enforceable. Subject to the foregoing, this Agreement
and the terms and provisions hereof shall inure to the benefit of and be
binding upon the successors and assigns of the parties.
H. Notices. Any notice which a party is required or may desire to
give the other shall be in writing and shall be sent by personal delivery,
by telecopier transmission (followed by delivery by mail as follows) or by
mail (either [i] by United States registered or certified mail, return
receipt requested, postage prepaid, or [ii] by Federal Express or similar
generally recognized overnight carrier regularly providing proof of
delivery), addressed as follows (subject to the right of a party to
designate a different address for itself by notice similarly given):
To Buyer:
GDA Real Estate Services, Inc.
8301 East Prentice Avenue, Suite 210
Englewood, Colorado 80111
Attention: Mr. Gary J. Dragel
Facsimile No. (303) 221-5501
Telephone No. (303) 221-5500
With Copy To:
Brownstein Hyatt Farber & Strickland, P.C.
410 Seventeenth Street, 22nd Floor
Denver, Colorado 80202
Attention: Robert Kaufmann, Esq.
Facsimile No. (303) 623-1956
Telephone No. (303) 534-6335
To Seller:
Carlyle Real Estate Limited Partnership-XIII
c/o JMB Realty Corporation
900 North Michigan Avenue
Chicago, Illinois 60611
Attention: Mr. Brian Ellison
Facsimile No. (312) 915-2399
Telephone No. (312) 915-2343
With Copies To:
Pircher, Nichols & Meeks
1999 Avenue of the Stars
Suite 2600
Los Angeles, California 90067
Attention: Real Estate Notices (GML)
Facsimile No. (310) 201-8922
Telephone No. (310) 201-8900
And To:
Richard Ellis, LLC
Three First National Plaza
Chicago, Illinois 60602
Attention: Mr. James G. Abbey
Facsimile No. (312) 899-0923
Telephone No. (312) 899-1900
Any notice so given by mail shall be deemed to have been given as of the
date of delivery (whether accepted or refused) established by U.S. Post
Office return receipt or the overnight carrier's proof of delivery, as the
case may be. Any such notice not so given shall be deemed given upon
receipt of the same by the party to whom the same is to be given.
I. Legal Costs. The parties hereto agree that they shall pay
directly any and all legal costs which they have incurred on their own
behalf in the preparation of this Agreement, all deeds and other agreements
pertaining to this transaction and that such legal costs shall not be part
of the closing costs. In addition, if either Buyer or Seller brings any
suit or other proceeding with respect to the subject matter or the
enforcement of this Agreement, the prevailing party (as determined by the
court, agency or other authority before which such suit or proceeding is
commenced), in addition to such other relief as may be awarded, shall be
entitled to recover reasonable attorneys' fees, expenses and costs of
investigation actually incurred. The foregoing includes, but is not
limited to, attorneys' fees, expenses and costs of investigation
(including, without limitation, those incurred in appellate proceedings),
costs incurred in establishing the right to indemnification, or in any
action or participation in, or in connection with, any case or proceeding
under Chapter 7, 11 or 13 of the Bankruptcy Code (11 United States Code
Sections 101 et seq.), or any successor statutes.
J. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
shall constitute one and the same document.
THE SUBMISSION OF THIS AGREEMENT FOR EXAMINATION IS NOT INTENDED TO
NOR SHALL CONSTITUTE AN OFFER TO SELL, OR A RESERVATION OF, OR OPTION OR
PROPOSAL OF ANY KIND FOR THE PURCHASE OF THE PROPERTY. IN NO EVENT SHALL
ANY DRAFT OF THIS AGREEMENT CREATE ANY OBLIGATION OR LIABILITY, IT BEING
UNDERSTOOD THAT THIS AGREEMENT SHALL BE EFFECTIVE AND BINDING ONLY WHEN A
COUNTERPART HEREOF HAS BEEN EXECUTED AND DELIVERED BY EACH PARTY HERETO TO
ESCROW HOLDER. ESCROW HOLDER SHALL DATE THIS AGREEMENT WITH THE DATE ON
WHICH ESCROW HOLDER SHALL HAVE RECEIVED THIS AGREEMENT EXECUTED BY BOTH
OPTIONEE AND OPTIONOR (AND SUCH DATE SHALL BE THE "EFFECTIVE DATE" FOR
PURPOSES HEREOF).
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the day and year first above written.
CARLYLE REAL ESTATE LIMITED PARTNERSHIP - XIII
an Illinois limited partnership
By: JMB REALTY CORPORATION,
a Delaware corporation
Corporate General Partner
By:
------------------------------------
Name:
------------------------------
Title:
------------------------------
"Seller"
GDA REAL ESTATE SERVICES, INC.,
a Colorado corporation
By:
------------------------------------
Name:
------------------------------
Title:
------------------------------
"Buyer"
<PAGE>
ESCROW HOLDER'S ACKNOWLEDGEMENT
The undersigned hereby executes this Agreement to evidence its
agreement to act as Escrow Holder in accordance with the terms of this
Agreement.
Date: ________________ CHICAGO TITLE INSURANCE COMPANY,
a Missouri corporation
By: ___________________________________
Name: _____________________________
Title: ____________________________
"Escrow Holder"
<PAGE>
EXHIBIT LIST
"A" - Property Description
"B" - Personal Property List
"C-1" - List of Required Tenants
"C-2" - Form of Tenant Estoppel Certificate
"D" - Deed
"E" - Assignment and Assumption Agreement
"F" - Exceptions to Seller's Representations and
Warranties
"G" - List of Leases
"H" - Service Agreements
"I" - Environmental Reports
EXHIBIT 10.2
- ------------
Carlyle Real Estate Limited Partnership-XIII
c/o JMB Realty Corporation
900 North Michigan Avenue
Chicago, Illinois 60611
As of September 3, 1997
GDA Real Estate Services, Inc.
8301 East Prentice Avenue
Suite 210
Englewood, Colorado 80111
Attention: Mr. Gary J. Dragul
Re: Michael's Aurora Plaza
Ladies and Gentlemen:
Reference is made to that certain Purchase Agreement and Joint Escrow
Instructions (the "Agreement") dated as of August 4, 1997, by and between
Carlyle Real Estate Limited Partnership-XIII, an Illinois limited
partnership ("Seller"), and GDA Real Estate Services, Inc., a Delaware
corporation ("Buyer"). Initially capitalized terms not otherwise defined
herein shall have the meanings ascribed to such terms in the Agreement.
In consideration of the mutual promises and undertakings of the
parties, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto hereby
agree as follows:
1. Purchase Price. Notwithstanding anything to the contrary
contained in the Agreement, the Purchase Price shall equal the sum of
$6,885,000.
2. Approval Notice; Extension of Deadline for Deposit of
Additional Escrow Deposit. Notwithstanding anything to the contrary
contained in the Agreement, this letter agreement shall constitute Buyer's
Approval Notice, and Buyer shall have until 5:00 p.m (Central time) on
September 4, 1997 to deliver the Additional Escrow Deposit to Escrow
Holder.
3. Optional Extension of Closing Date. Notwithstanding anything
to the contrary contained in the Agreement, Buyer may extend the Closing
Date to October 15, 1997, so long as Buyer gives written notice of such
extension to Seller no later than September 30, 1997 and Buyer delivers the
sum of $100,000 (the "Extension Fee") to Escrow Holder on or before October
2, 1997. Buyer hereby acknowledges that, in the event that Buyer elects to
extend the Closing Date as aforesaid, the Extension Fee, together with all
interest earned on the Extension Fee while the same is held by Escrow
Holder, shall be considered part of the Escrow Deposit and shall be held by
Escrow Holder as a deposit against the Purchase Price in accordance with
the terms and conditions of the Agreement, as amended hereby.
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4. Counterparts. This letter agreement may be executed in
counterparts, each of which shall be deemed an original, and all of which
shall together constitute one letter agreement.
Please indicate your consent to the foregoing by signing where noted
below.
Very truly yours,
CARLYLE REAL ESTATE LIMITED PARTNERSHIP-XIII,
an Illinois limited partnership
By: JMB REALTY CORPORATION,
a Delaware corporation,
Corporate General Partner
By:
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Name:
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Title:
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AGREED TO AS OF
SEPTEMBER 3, 1997
GDA REAL ESTATE SERVICES, INC.,
a Colorado corporation,
By:
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Name:
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Title:
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cc: Mr. Mej Ellsworth
Robert Kaufmann, Esq.
Mr. James Abbey
Robert D. Jaffe, Esq.
