UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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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) September 21, 1998
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PAINE WEBBER INCOME PROPERTIES FIVE LIMITED PARTNERSHIP
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(Exact name of registrant as specified in its charter)
Delaware 0-12087 04-2780287
- --------------------------------------------------------------------------------
(State or other jurisdiction of (Commission (I.R.S. Employer
incorporation or organization) File Number) Identification No.)
265 Franklin Street, Boston, Massachusetts 02110
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (617) 439-8118
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(Former name or address, if changed since last report)
<PAGE>
FORM 8-K
CURRENT REPORT
PAINE WEBBER INCOME PROPERTIES FIVE LIMITED PARTNERSHIP
ITEM 2 - Disposition of Assets
CARRIAGE HILL VILLAGE APARTMENTS, Randallstown, Maryland
Disposition Date - September 21, 1998
On September 21, 1998, Randallstown Carriage Hill Associates and Signature
Partners LLC, a joint venture and a limited liability company in which Paine
Webber Income Properties Five Limited Partnership ("the Partnership") had
interests, sold the property known as Carriage Hill Village Apartments and
adjoining land located in Randallstown, Maryland, to unrelated third parties,
Castle Venturers Limited and Company Motors Corporation, for an aggregate sale
price of $37,350,000. The Partnership received net proceeds of approximately
$8,481,000 after the receipt of a credit of $1,168,000 for property adjustments
and escrows held by the Department of Housing and Urban Development (HUD) for
tenant security deposits, real estate taxes, property insurance and replacement
reserves, and after deducting closing costs of approximately $757,000, the
assumption of the existing first mortgage loan of $27,298,000 and a payment of
approximately $1,982,000 to the Partnership's co-venture partner for its share
of the sales proceeds in accordance with the joint venture agreement. Of the
total proceeds received by the Partnership of $8,481,000, as discussed further
below, $4 million represented a reimbursement of funds originally advanced to
buy out the selling co-venture partner's interest in the Carriage Hill joint
venture on June 23, 1998. The Partnership had borrowed the $4 million required
to complete the buyout of the selling partner's interest from an affiliate of
the Managing General Partner. The $4 million related party loan was repaid on
September 11, 1998 from the Partnership's share of the net proceeds from the
sale of the Greenbrier Apartments.
As discussed further in the Partnership's Quarterly Report on Form 10-Q
for the period ended June 30, 1998, on June 23, 1998 the Partnership and its
original co-venture partner, JBG/Carriage Hill Village Limited Partnership,
purchased the 50% interest of its other co-venture partner, Signature Carriage
Hill Village Apartments Limited Partnership ("Signature"), in the Randallstown
Carriage Hill Associates Joint Venture (the "Joint Venture"). The Partnership
had held a 40% interest and the original co-venture partner had held a 10%
interest in the Joint Venture prior to this transaction. The Partnership
contributed $4,048,000 and the original co-venturer contributed $1,012,000 to
complete the purchase of the other partner's interest. After the purchase, the
Partnership held an 80% interest and the original co-venture partner held a 20%
interest. On March 19, 1998, the Partnership was notified by Signature that it
would be exercising the "buy/sell" provision in the Joint Venture agreement.
Under the terms of this provision, this co-venturer, which was admitted to the
Joint Venture as part of a 1988 restructuring transaction, had to propose a
price at which it would either purchase the other partners' interests in the
Venture or agree to the sale of its interest in the Venture to the other
partners. The Partnership and its original co-venture partner in the Carriage
Hill Joint Venture had 45 days to decide whether to sell their interests to the
exercising partner or acquire the interest of the exercising partner at the
specified gross sale price for the Venture's assets of approximately $33.3
million. At an equivalent gross sale price of $33.3 million, the net proceeds to
the Partnership for the sale of its interest would have been approximately
$700,000 after the assumption of the outstanding first mortgage debt of $27.4
<PAGE>
FORM 8-K
CURRENT REPORT
PAINE WEBBER INCOME PROPERTIES FIVE LIMITED PARTNERSHIP
million, the exercising partner's preferred investment return of approximately
$5 million and the original co-venturer's share of the proceeds of $200,000.
After a thorough review and analysis, the Partnership and the original
co-venturer notified the exercising partner on May 1, 1998 of their decision to
buy its interest for approximately $5 million in cash.
Because the Partnership believed that improvements in the apartment segment
of the real estate market would allow the Partnership to achieve a higher net
sale price now than may be possible in the future, the Partnership and its
remaining co-venture partner held discussions concerning the near-term sale of
the Carriage Hill Apartments immediately after completing the purchase of the
selling partner's interest in June 1998. Subsequently, the Partnership and its
co-venture partner selected a national real estate firm with a strong background
in selling apartments. Preliminary sale materials were then finalized and
extensive sale efforts began in late June 1998. As a result of those efforts,
ten offers were received. After completing an evaluation of the offers and the
relative strength of the prospective purchasers, the Partnership and its
co-venture partner selected an offer. On July 24, 1998, a purchase and sale
agreement was signed and a non-refundable deposit of $1,000,000 was made by the
prospective purchasers. The Carriage Hill sale allowed the Partnership to return
approximately $3.7 million more in net sale proceeds and property escrows, after
the return of the $4,000,000 buyout advance, than the $700,000 the Partnership
would have received had it not acquired the selling co-venture partner's
interest. Because the Partnership expects to receive final documentation in
early November 1998 from HUD for the assumption of the HUD first mortgage loan
by the Carriage Hill Apartments buyer, a special capital distribution is
expected to be sent by December 1, 1998 from the sale of Carriage Hill
Apartments in the amount of approximately $240 per original $1,000 investment,
or $8,383,000.
ITEM 7 - Financial Statements and Exhibits
(a) Financial Statements: None
(b) Exhibits:
(1) Purchase and Sale Agreement by and between Randallstown Carriage
Hill Associates and Signature Partners, LLC, collectively "Seller",
and Castle Ventures Limited, dated July 24, 1998.
(2) Special Warranty Deed by and between Randallstown Carriage Hill
Associates and Castle Ventures Limited, dated September 16, 1998.
(3) Bill of Sale and Assignment by Randallstown Carriage Hill Associates
in favor of Castle Ventures Limited, dated September 16, 1998.
(4) Closing Statement between Castle Venturers, Ltd. and Company Motors
Corp. Acquisition from Randallstown Carriage Hill and Signature
Partners, LLC, dated September 16, 1998.
<PAGE>
FORM 8-K
CURRENT REPORT
PAINE WEBBER INCOME PROPERTIES FIVE LIMITED PARTNERSHIP
SIGNATURE
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
PAINE WEBBER INCOME PROPERTIES FIVE LIMITED PARTNERSHIP
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(Registrant)
By: /s/ Walter V. Arnold
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Walter V. Arnold
Senior Vice President and
Chief Financial Officer
Date: October 5, 1998
<PAGE>
PURCHASE AND SALE AGREEMENT
BY AND BETWEEN
RANDALLSTOWN CARRIAGE HILL ASSOCIATES and
SIGNATURE PARTNERS, L.L.C.
(collectively, "SELLER")
AND
CASTLE VENTURES LIMITED, A New York Corporation
("BUYER")
<PAGE>
TABLE OF CONTENTS
Page
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ARTICLE 1 DEFINITIONS 4
ARTICLE 2 PURCHASE AND SALE 5
ARTICLE 3 PURCHASE PRICE; DEPOSIT; ADJUSTMENTS 5
ARTICLE 4 PRECLOSING OPERATION 8
ARTICLE 5 ACCESS, INSPECTION, DILIGENCE 9
ARTICLE 6 TITLE AND SURVEY 12
ARTICLE 7 CLOSING 14
ARTICLE 8 CASUALTY AND CONDEMNATION 16
ARTICLE 9 BROKERAGE COMMISSIONS 17
ARTICLE 10 DEFAULT, TERMINATION AND REMEDIES 17
ARTICLE 11 REPRESENTATIONS AND WARRANTIES 18
ARTICLE 12 MISCELLANEOUS 20
ARTICLE 13 IRS FORM 1099-S DESIGNATION 23
SCHEDULE A Legal Description
SCHEDULE A-1 Legal Description of Additional Land
SCHEDULE B Personal Property and Intangible Property
SCHEDULE C Rent Roll
SCHEDULE D 1099 Designation Agreement
SCHEDULE E Form of Earnest Money Escrow Instructions
SCHEDULE F Form of Post-Preliminary HUD Approval Closing Escrow
Instructions
<PAGE>
Purchase and Sale Agreement
This Purchase and Sale Agreement (this "Agreement") is entered into as of
July 24, 1998 by and between Seller and Buyer, upon the following terms and
conditions:
ARTICLE 1
DEFINITIONS
References in this Agreement to the following terms shall have the
following meanings:
Additional Land: The land more particularly described in Schedule A-1
- --------------- attached hereto
Buyer: Castle Ventures Limited, a New York corporation
- ------
Deposit: See Section 3.1
- -------
Escrowed Amount: See Section 3.1
- ---------------
Lender: GMAC Commercial Mortgage Corporation.
- -------
Loan Documents: That certain Deed of Trust Note in the original principal
- -------------- amount of $27,882,600, dated as of June 1, 1995 made by
Randallstown Carriage Hill Associates in favor of Lender
secured by: (x) that certain Deed of Trust dated as of even
date therewith encumbering the Real Property, (y) that
certain Security Agreement dated as of even date therewith
by and among Randallstown Carriage Hill Associates, Lender
and HUD and (z) any and all other documents executed in
connection therewith.
Personal Property: The personal and intangible Property, if any,
- ----------------- described in Schedule B attached hereto
Property: The Real Property and Personal Property known as Carriage
- -------- Hill Village Apartments and Additional Land
Purchase Price: $37,350,000
- --------------
Real Property: The land, as more particularly described in
- ------------- Schedule A attached hereto, and the buildings, structures,
improvements and fixtures (collectively the "Improvements")
now located thereon and the rights appurtenant thereto
Seller: Randallstown Carriage Hill Associates, a Maryland general
- ------ partnership and Signature Partners, L.L.C, a Maryland limited
liability company
Title Company: Chicago Title Insurance Company
- -------------
ARTICLE 2
PURCHASE AND SALE
2.1. In consideration of the undertakings and mutual covenants of the
parties set forth in this Agreement, and for other good and valuable
consideration, the receipt and legal sufficiency of which are hereby
acknowledged, Seller hereby agrees to sell and convey the Property to Buyer and
Buyer hereby agrees to buy and pay the Purchase Price for the Property on the
terms and conditions contained herein.
2.2. This Agreement and the transactions contemplated herein are expressly
conditioned upon preliminary approval by HUD of the transaction as set forth in
Form HUD 92266, Application for Transfer of Physical Assets, and supporting
documentation submitted to HUD ("Preliminary HUD Approval"). No transfer of any
interest in the project (which is a portion of the Property) under this
Agreement shall be effective prior to such HUD approval. Buyer will not take
possession of the project nor assume the benefits of project ownership prior to
such approval by HUD. The Buyer, his heirs, executors, administrators or
assigns, shall have no right upon any breach by Seller hereunder to seek
damages, directly or indirectly, from the FHA project which is the subject of
this Agreement, including from any assets, rents, issues or profits thereof, and
Buyer shall have no right to effect a lien upon this project (or the Property)
or the assets, rents, issues or profits thereof. Buyer will not take possession
or control of the project prior to approval by HUD.
ARTICLE 3
PURCHASE PRICE; DEPOSIT; ADJUSTMENTS
3.1 Deposit. Contemporaneously with the execution of this Agreement, Buyer
shall deposit with the Title Company the sum of ONE HUNDRED THOUSAND DOLLARS
($100,000) in immediately available funds (the "Deposit") to secure Buyer's
obligations under this Agreement. The Title Company shall hold the Deposit in a
segregated interest bearing money market account with an FDIC insured bank
reasonably acceptable to Buyer and Seller. The Deposit and all interest accrued
on the Deposit (collectively, the "Escrowed Amount") shall be maintained by the
Title Company in such account or accounts until the Title Company is required to
cause the Escrowed Amount to be disbursed pursuant to the terms and conditions
of this Agreement and the Earnest Money Escrow Instructions attached hereto as
Schedule E.
3.2 Purchase Price. The Purchase Price shall be as specified in Article 1
above and shall be paid on the Closing Date (as hereinafter defined) as follows:
(a) $27,400,000 or such lower amount to reflect the then outstanding
principal balance under the Note (as hereinafter defined) (the "Debt
Balance") by assuming Seller's obligations under the Loan Documents
(as hereinafter defined) (the "Debt Balance") by assuming (i) that
certain Deed of Trust Note (the "Note") in the original principal
amount of $27,882,600.00 dated as of June 1, 1995 payable to the
order of GMAC Commercial Mortgage Corporation (the "Lender"), (ii)
that certain Deed of Trust (the "Deed of Trust") of even date with
the Note, (iii) that certain Regulatory Agreement (the "Regulatory
Agreement") of even date with the Note, and (iv) all other documents
and instruments executed and delivered in connection with the Note
(the Note, the Deed of Trust, the Regulatory Agreement and all such
documents evidencing, relating to or executed in connection with the
loan (the "Loan") evidenced by the Note are collectively referred to
herein as the "Loan Documents"); and
(b) an amount equal to the Purchase Price less the Debt Balance by
wire transfer of immediately available federal funds; provided,
however, that the immediately available funds portion of the
Purchase Price shall be subject to adjustment to reflect application
of the Escrowed Amount and such other adjustments herein contained.
3.3 Tax Proration. All due and payable real estate taxes attributable to
the Property through the Closing Date shall be prorated and adjusted as of the
Closing Date. If the tax statements for the fiscal year during which the Closing
Date occurs are not finally determined, then the tax figures for the immediately
prior fiscal year shall be used for the purposes of prorating taxes on the
Closing Date, with a further adjustment to be made after the Closing Date as
soon as the tax figures are finalized. Any tax refunds or proceeds (including
interest thereon) on account of a favorable determination resulting from a
challenge, protest, appeal or similar proceeding relating to taxes and
assessments relating to the Property (i) for all tax periods occurring prior to
the applicable tax period in which the Closing occurs shall be retained by and
paid exclusively to Seller and (ii) for the applicable tax period in which the
Closing occurs shall be prorated as of the Closing Date after reimbursement to
Seller and Buyer, as applicable, for all fees, costs and expenses (including
reasonable attorneys' and consultants' fees) incurred by Seller or Buyer, as
applicable, in connection with such proceedings such that Seller shall retain
and be paid that portion of such tax refunds or proceeds as is applicable to the
portion of the applicable tax period prior to the Closing Date and Buyer shall
retain and be paid that portion of such tax refunds or proceeds as is applicable
to the portion of the applicable tax period from and after the Closing Date.
Neither Seller nor Buyer shall settle any tax protests or proceedings in which
taxes for the tax period for which the other party is responsible are being
adjudicated without the consent of such party, which consent shall not be
unreasonably withheld, conditioned or delayed. After the Closing, Buyer shall be
responsible for and control any tax protests or proceedings for any period for
which taxes are adjusted between the parties under this Agreement and for any
later period. Buyer and Seller shall cooperate in pursuit of any such
proceedings and in responding to reasonable requests of the other for
information concerning the status of and otherwise relating to such proceedings;
provided, however, that neither party shall be obligated to incur any
out-of-pocket fees, costs or expenses in responding to the requests of the
other.
3.4 Contract Proration. Prepaid or past due amounts under any Contracts
(as hereinafter defined) which are assigned to Buyer at Closing shall be
prorated and adjusted as of the Closing Date.
3.5 Utility Proration. To the extent reasonably feasible, the Seller shall
cause all meters for electricity, gas, water, sewer or other utility usage at
the Property to be read on the Closing Date, and the Seller shall pay all
charges for such utilities which have accrued on or prior to the Closing Date;
provided, however, that if and to the extent such charges are paid directly by
tenants, no such reading or payment shall be required. If the utility companies
are unable or refuse to read meters for which payment by the Seller is required,
all charges for such utilities to the extent unpaid shall be prorated and
adjusted as of the Closing Date based on the most recent bills therefor. The
Seller shall provide notice to the Buyer within five (5) days of the Closing
Date setting forth (i) whether utility meters will be read as of the Closing
Date and (ii) a copy of the most recent bill for any utility charges which are
to be prorated and adjusted as of the Closing Date. If the meters cannot be read
as of the Closing Date and, therefore, the most recent bill is used to prorate
and adjust as of the Closing Date, then to the extent that the amount of such
prior bill proves to be more or less than the actual charges for the period in
question, a further adjustment shall be made after the Closing Date as soon as
the actual charges for such utilities are available.
3.6 Income and Expense Proration. Collected rents for the then current and
any future period, security deposits which have not been previously applied by
Seller, prepaid rentals, interest under the Loan Documents, and all expenses and
other charges in connection with the operation of the Property shall be
apportioned and full value shall be adjusted as of the Closing Date, and the net
amount thereof, if in favor of Seller, shall be added to the Purchase Price, or
if in favor of Buyer, shall be deducted from the Purchase Price. From and after
Closing all security deposits credited to Buyer shall thereafter be deemed
transferred to Buyer and Buyer shall assume and be solely responsible for the
payments of security deposits to tenants in accordance with the Leases and
applicable law. Seller shall be entitled to retain or if transferred to Buyer
receive a credit for any utility deposits and any deposits for third parties
under any of the Contracts (as hereinafter defined). Seller shall receive a
credit for the full amount of any escrows or reserves held by or on behalf of
Lender. In addition to the foregoing, at Closing the Purchase Price shall be
increased by the amount of uncollected or past due rent.
3.7 Closing Costs. Seller shall pay (a) its legal fees and expenses, (b)
50% of the escrow fees of the Title Company and (c) any assumption fee
contemplated pursuant to the terms of the existing Loan Documents which is
payable to Lender in connection with the assumption of the Loan by Buyer. Buyer
shall pay all other costs in carrying out the transactions contemplated
hereunder, including, without limitation, (i) 50% of the escrow fees of the
Title Company, (ii) charges to record the deed, and evidence of Buyer's
existence or authority, (iii) Buyer's legal fees and expenses, (iv) all costs
related to the Buyer's inspection and due diligence, (v) the cost of an owner's
title policy and a new Lender's policy or any required endorsements to the
Lender's existing policy, (vi) the cost of the survey, (vii) all costs and
expenses in connection with the assumption of the Loan (including, but not
limited to the title costs and legal costs but not including any assumption fee
contemplated pursuant to the terms of the existing Loan Documents) and (viii)
all state, county or other taxes associated with the transfer of the property
and the assumption of the Loan Documents.
ARTICLE 4
PRECLOSING OPERATION
4.1 Leases. A rent roll containing a list of all current occupants of the
Property is attached hereto as Schedule C. The leases with the occupants listed
on the rent roll (each a "Lease"), together with leases entered into pursuant to
this Article 4 are collectively referred to herein as the "Leases".
4.2 Conduct of Business. At all times prior to Closing, Seller shall
continue (a) to conduct business with respect to the Property in the same manner
in which said business has been heretofore conducted and (b) to insure the
Property substantially as currently insured.
4.3 Contracts. Seller shall make copies of all service, supply, equipment
rental, management, operating and leasing contracts (collectively, the
"Contracts") affecting the Property available for Buyer to review promptly after
the date hereof. On or before the tenth Business Day after the date hereof,
Buyer shall provide written notice to Seller of the Contracts that Buyer desires
to have terminated by Seller, and Seller will terminate the Contracts so
identified at or before Closing, provided that such Contracts may be terminated
without cost or liability to Seller and if there is cost or liability to Seller,
Buyer shall be responsible for any such liability which, if monetary in nature
shall be adjusted for at Closing by providing a credit to Seller and shall
otherwise be addressed pursuant to an indemnification agreement in form and
substance acceptable to Seller. At Closing, Seller shall assign and Buyer shall
assume the Contracts, except those Contracts which Seller has agreed to
terminate. Buyer and Seller shall indemnify, defend and hold the other harmless
from and against any and all claims under the Contracts which relate to its
respective period of ownership. Notwithstanding the foregoing, Seller's existing
management contract and exclusive brokerage contract for the Property shall be
terminated by Seller effective as of the Closing Date.
ARTICLE 5
ACCESS, INSPECTION, DILIGENCE
5.1 Access. Seller agrees that Buyer and its authorized agents or
representatives shall be entitled to enter upon the Real Property during normal
business hours upon reasonable advance written or telephonic notice to Seller
and make such reasonable, nondestructive investigations, studies and tests
including, without limitation, surveys and engineering studies as Buyer deems
necessary or advisable, provided, however, that Buyer shall not be permitted to
conduct physical testing without Seller's prior written consent, which consent
shall not be unreasonably withheld, conditioned or delayed. Seller's prior
written consent for physical inspections or testing may be conditioned upon
receipt of a detailed description of the proposed physical inspection or
testing, a list of contractors who will be performing the physical inspection or
testing, evidence of insurance satisfactory to Seller, and such other
information as Seller reasonably requires in connection with such proposed
inspection or testing. Seller also agrees to make available to Buyer during
normal business hours for review and copying at Buyer's expense upon advance
written notice to Seller all books, records, plans, building specifications,
contracts, agreements, or other instruments or documents contained in Seller's
files relating to the construction, operation and maintenance of the Property
including warranties.
5.2 Additional Information. To the extent Seller has any studies, site
analyses, certificates of occupancy, property tax information, permits, existing
title insurance policies, existing surveys, existing zoning analyses, existing
engineering reports and existing code compliance reports, Seller agrees to make
the same available for review and copying at Buyer's expense by Buyer or its
agents promptly after execution of this Agreement.
Buyer acknowledges and agrees that any and all information, documents,
surveys, studies and reports provided to Buyer are provided for informational
purposes only and do not constitute representations or warranties of Seller of
any kind.
Buyer acknowledges that it has had an opportunity to conduct diligence on
the Property and is acquiring the Property in its current condition based on its
diligence. Buyer further acknowledges that neither Seller nor its employees,
agents or representatives have made any representation or warranty as to the
condition of the Property or the presence or absence of any hazardous materials
on, in, under or within the Property or a portion thereof which survive closing
hereunder. THE BUYER ACKNOWLEDGES AND AGREES THAT THE PROPERTY IS TO BE CONVEYED
BY THE SELLER TO THE BUYER "AS IS," "WITH ALL FAULTS," AND SUBSTANTIALLY IN ITS
CURRENT CONDITION. THE BUYER FURTHER ACKNOWLEDGES AND AGREES THAT, EXCEPT AS
EXPRESSLY CONTAINED HEREIN, NEITHER THE SELLER NOR ANY AGENT, EMPLOYEE OR OTHER
REPRESENTATIVE OF THE SELLER (OR PURPORTED AGENT, EMPLOYEE OR OTHER
REPRESENTATIVE OF THE SELLER) HAS MADE ANY GUARANTEE, REPRESENTATION OR
WARRANTY, EXPRESS OR IMPLIED (AND THE SELLER SHALL NOT HAVE ANY LIABILITY
WHATSOEVER) AS TO THE VALUE, USES, HABITABILITY, CONDITION, DESIGN, OPERATION,
FINANCIAL CONDITION OR PROSPECTS, OR FITNESS FOR PURPOSE OR USE OF THE PROPERTY
(OR ANY PART THEREOF) OR THE PROPERTY INFORMATION, OR ANY OTHER GUARANTEE,
REPRESENTATION OR WARRANTY WHATSOEVER, EXPRESS OR IMPLIED, WITH RESPECT TO ANY
PORTION OF THE PROPERTY (OR ANY PART THEREOF) OR THE PROPERTY INFORMATION.
FURTHER, THE SELLER SHALL HAVE NO LIABILITY FOR ANY LATENT, HIDDEN, OR PATENT
DEFECT AS TO THE PROPERTY OR THE FAILURE OF THE PROPERTY, OR ANY PART THEREOF,
TO COMPLY WITH ANY APPLICABLE LAWS AND REGULATIONS. IN PARTICULAR, THE BUYER
ACKNOWLEDGES AND AGREES THAT THE "PROPERTY INFORMATION" PROVIDED UNDER THIS
AGREEMENT (AND ANY OTHER INFORMATION THE BUYER MAY HAVE OBTAINED REGARDING IN
ANY WAY ANY OF THE PROPERTY, INCLUDING WITHOUT LIMITATION, ITS OPERATIONS OR ITS
FINANCIAL HISTORY OR PROSPECTS FROM THE SELLER OR ITS AGENTS, EMPLOYEES OR OTHER
REPRESENTATIVES) IS DELIVERED TO THE BUYER AS A COURTESY, WITHOUT REPRESENTATION
OR WARRANTY AS TO ITS ACCURACY OR COMPLETENESS, AND NOT AS AN INDUCEMENT TO
ACQUIRE THE PROPERTY; THAT NOTHING CONTAINED IN SUCH DELIVERIES SHALL CONSTITUTE
OR BE DEEMED TO BE A GUARANTEE, REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED,
IN ANY REGARD AS TO ANY OF THE PROPERTY (EXCEPT AS EXPRESSLY PROVIDED HEREIN);
AND THAT THE BUYER IS RELYING ONLY UPON THE PROVISIONS OF THIS AGREEMENT AND ITS
OWN INDEPENDENT ASSESSMENT OF THE PROPERTY AND ITS PROSPECTS IN DETERMINING
WHETHER TO ACQUIRE THE PROPERTY. THE PROVISIONS OF THIS PARAGRAPH SHALL SURVIVE
CLOSING.
5.4 Return of Documents. If this Agreement is terminated for any reason
whatsoever, Buyer shall promptly deliver to Seller all documents, plans,
surveys, contracts, Leases and the like delivered to Buyer or Buyer's agents,
representatives or designees by Seller or Seller's agents, representatives or
employees pursuant to this Agreement. In addition, Buyer shall promptly deliver
to Seller copies of all materials obtained in connection with Buyer's diligence.
Return of the Escrowed Amount to Buyer under this Agreement shall be contingent
upon Buyer's fulfillment of the obligations under this Section 5.4.
5.5 Confidentiality. Each party hereto agrees to maintain in confidence,
and not to discuss with or to disclose to any person or entity who is not a
party to this Agreement, any material term of this Agreement or any aspect of
the transactions contemplated hereby, except as provided in this Section. Seller
may publicly disclose the existence of this Agreement provided that the identity
of Buyer is not disclosed. Buyer shall not disclose to anyone other than its
partners and financiers any information disclosed by Seller to Buyer which is
not generally known by the public regarding Seller's operations and/or the
Property. Each party hereto may discuss with and disclose to its accountants,
attorneys, existing or prospective lenders, investment bankers, underwriters,
rating agencies, partners, consultants and other advisors to the extent such
parties reasonably need to know such information and are bound by a
confidentiality obligation identical in all material respects to the one created
by this Section. Additionally, each party may discuss and disclose such matters
to the extent necessary to comply with any requirements of the Securities and
Exchange Commission or in order to comply with any law or interpretation thereof
or court order. This provision shall survive termination of this Agreement but
shall terminate upon Close of Escrow. Any press release to be made regarding any
matter which is the subject of the confidentiality obligation created in this
Section shall be subject to the reasonable approval of Buyer and the Seller,
respectively both as to timing and content.
5.6 Indemnity. If any inspection or test disturbs any of the Property,
Buyer will restore the Property to substantially the same condition as existed
prior to any such inspection or test. Buyer shall keep the Property free and
clear of any liens caused by Buyer or its agents or consultants and will
indemnify, defend, and hold Seller harmless from all losses, costs and damages
including reasonable attorneys' fees incurred by Seller as a result of such
entry or investigation by or on behalf of Buyer. This indemnity obligation of
Buyer shall survive the termination of this Agreement for any reason.
ARTICLE 6
TITLE SURVEY AND HUD APPROVAL
6.1. Deed. On the Closing Date, Seller shall convey by good and sufficient
special warranty grant deed to Buyer good and clear record and marketable fee
simple title to all of the Real Property, Additional Land and the Improvements
free and clear of all liens, encumbrances, conditions, easements, assessments,
restrictions and other conditions, except for the following:
i. All Leases;
ii. All zoning, building and other laws applicable to the Property;
iii. All matters which arise after the date hereof which are agreed
upon or consented to by Buyer;
iv. The Loan Documents;
v. The lien, if any, for real estate taxes not yet due and payable;
and
vi. All matters of public record as of the date hereof.
6.2. Lease Assignment. At the Closing, Seller shall assign the Leases to
Buyer and Buyer shall assume Seller's obligations thereunder and Seller shall
convey the Personal Property to Buyer by quitclaim bill of sale.
6.3. Lender and HUD Approval.
i. Buyer acknowledges that Buyer and any property manager
retained by Buyer must submit to HUD Form 92266 Application
for Transfer of Physical Assets and supporting documents in
connection with the proposed acquisition of the Property.
Buyer agrees that it will commence and diligently prepare the
same. Seller agrees to cooperate with Buyer in good faith in
the preparation of the same.
ii. Buyer agrees to submit a completed Form 92266 to HUD no later
than ten business days after the date hereof. Failure to do so
shall, ten business days after notice from Seller to Buyer,
constitute a default by Buyer hereunder.
iii. In the event that Buyer has submitted a Form 92266 to HUD and
HUD has either: (1) refused to approve the transfer
contemplated by this Agreement or (2) failed to approve such
transfer within 100 days after the date hereof, then Seller
may terminate this Agreement by written notice to Buyer and
retain the Escrowed Amount and Buyer agrees to direct Title
Company to release the Escrowed Amount to Seller.
iv. Buyer agrees to cooperate in all respects with Seller's
efforts to obtain Lender's consent, and to timely provide
all documentation and information required by Lender in
connection therewith. If Lender does not consent to the
assumption of the Loan by Buyer, then Seller may terminate
this Agreement by written notice to Buyer and retain the
Escrowed Amount. Buyer agrees to direct Title Company to
release the Escrowed Amount to Seller.
v. In the event that Lender and HUD consent to the sale of the
Property to Buyer and the assumption of the Loan by Buyer
but condition such consent upon Seller remaining liable
under the terms of the Loan Documents for matters occurring
after the Closing Date, Seller may terminate this Agreement
by written notice to Buyer, and retain the Escrowed Amount
and Buyer agrees to direct Title Company to release the
Escrowed Amount to Seller.
<PAGE>
ARTICLE 7
CONDITIONS PRECEDENT AND CLOSING
7.1 Buyer's Conditions Precedent. In addition to any other conditions
precedent in favor of Buyer as may be set forth elsewhere in this Agreement,
Buyer's obligations under this Agreement are expressly subject to the timely
fulfillment of the conditions set forth in this Section 7.1 on or before the
Closing Date, or such earlier date as is set forth below. Each condition may be
waived in whole or in part only by written notice of such waiver from Buyer to
Seller.
(i) Seller performing and complying in all material respects with
all of the terms of this Agreement to be performed and complied with
by Seller prior to or at the Closing.
(ii) The full assumption of the Loan by Buyer and the transfer of
the Property shall have received Preliminary HUD Approval and the
approval of Lender, and all conditions for the effectiveness of such
assumption (but for the Closing) shall have been met; provided,
however, if the condition precedent set forth in this Section
7.1(ii) is not satisfied, Buyer's sole remedy shall be to terminate
this Agreement by notice in writing to Seller. Buyer acknowledges
that in the event that it terminates this Agreement pursuant to this
Section 7.1(ii), Seller shall be entitled to retain the Escrowed
Amount and Buyer agrees to direct Title Company to release the
Escrowed Amount to Seller.
(iii) The form of the assumption documents being satisfactory to
Buyer in their sole, but reasonable discretion.
7.2 Seller's Conditions Precedent. In addition to any other conditions
precedent in favor of Seller as may be set forth elsewhere in this Agreement,
Seller's obligations under this Agreement are expressly subject to the timely
fulfillment of the conditions set forth in this Section 7.2 on or before the
Closing Date, or such earlier date as is set forth below. Each condition may be
waived in whole or part only by written notice of such waiver from Seller to
Buyer.
(i) Buyer performing and complying in all material respects with all
of the terms of this Agreement to be performed and complied with by
Buyer prior to or at the Closing.
(ii) On the Closing Date, all of the representations of Buyer set
forth in this Agreement shall continue to be true, accurate and
complete.
(iii) The full assumption of the Loan by Buyer and the transfer of
the Property shall have received Preliminary HUD Approval and the
approval of Lender, and all conditions for the effectiveness of such
assumption (but for the Closing) shall have been met.
(iv) The release by Lender of Seller from any and all obligations
and liability under the Loan Documents and the form of the
assumption and release documents being satisfactory to Seller in
their sole, but reasonable discretion.
7.3 Closing Date. The consummation of the purchase and sale contemplated
in this Agreement (the "Closing") shall occur through an escrow closing
arrangement as described in Schedule G attached hereto on the date that is five
(5) business days after receipt by Seller and Purchaser of Preliminary HUD
Approval as to which date time shall be of the essence (the "Closing Date").
7.4 Closing Deliveries. On the Closing Date, Seller shall deliver or
cause to be delivered:
(a) Duly executed and acknowledged special warranty deeds conveying
the Real Property, Additional Land and the Improvements to Buyer;
(b) A duly executed quitclaim bill of sale conveying the Personal
Property to Buyer;
(c) A duly executed assignment and assumption of leases (the
"Assignment of Leases");
(d) A duly executed assignment and assumption of Contracts being
assumed, licenses, guaranties, warranties, permits and intangible property
(the "Assignment of Contracts");
(e) A certificate or certificates of non-foreign status from Seller;
(f) Customary affidavits sufficient for the Title Company to delete
any exceptions for mechanic's or materialmen's liens and parties in
possession from Buyer's title policy and such other affidavits relating to
such title policy as the Title Company may reasonably request;
(g) Duly executed instruments evidencing Preliminary HUD Approval
and Lender's written consent to the sale of the Property to Buyer;
(h) Such other instruments as Buyer, Lender or the Title Company may
reasonably request to effectuate the transactions contemplated by this
Agreement;
(i) A counterpart original of the closing statement setting forth
the Purchase Price, the closing adjustments and the application of the
Purchase Price as adjusted;
(j) Evidence of Seller's authority to sell the Property reasonably
satisfactory to Title Company;
(k) Originals, or where unavailable, copies of Leases, operating
information, Contracts, permits, warranties and financial information
about the Property to the extent in Seller's possession;
(l) Keys and similar items, to the extent in Seller's possession;
and
(m) Notice Letters to tenants informing them of the Closing.
7.5 Buyer's Deliveries. On the Closing Date, Buyer shall deliver or cause
to be delivered at its expense each of the following to Seller:
(a) The Purchase Price for the Property, as such Purchase Price may
have been adjusted pursuant to the provisions of this Agreement and
credited for any portion of the Escrowed Amount paid to Seller, in the
manner provided for in Article 3;
(b) Evidence in form and substance reasonably satisfactory to Title
Company and Seller of Buyer's authority to purchase the Property;
(c) The Assignment of Leases;
(d) The Assignment of Contracts;
(e) Duly executed assumption agreement regarding the Loan Documents
and such other instruments as Lender may require in connection with the
assumption of the Loan Documents;
(f) Such other instruments as Seller or Title Company may reasonably
request to effectuate the transactions contemplated by this Agreement; and
(g) A counterpart original of the closing statement setting forth
the Purchase Price, the closing adjustments and the application of such
amounts.
ARTICLE 8
CASUALTY AND CONDEMNATION
8.1 Casualty. If the Improvements are materially damaged by fire or any
other casualty and are not substantially restored to the condition immediately
prior to such casualty before the Closing Date, Buyer shall have the following
elections:
(a) to purchase the Property in its then condition and pay the
Purchase Price, in which event Seller shall pay over or assign to Buyer as
the case may be, on the Closing Date, amounts recovered or recoverable by
Seller on account of any insurance as a result of such casualty up to the
amount of the Purchase Price, less any amounts reasonably expended by
Seller for partial restoration; or
(b) if any portion of the Improvements suffers damage in excess of
$1,500,000 from fire or any other casualty which Seller, in its sole
option, elects not to repair, to terminate this Agreement by giving notice
of termination to Seller on or before that date which is thirty (30) days
after the occurrence of the fire or other casualty or on the Closing Date,
whichever occurs first, in which event the Title Company shall return the
Escrowed Amount to Buyer, this Agreement shall terminate and neither
Seller nor Buyer shall have any recourse against the other (except to the
extent such recourse arises in connection with a provision of this
Agreement which is intended to survive termination).
8.2 Condemnation. If any substantial portion of or interest in the
Property shall be taken or is in the process of being taken by exercise of the
power of eminent domain or if any governmental authority notifies Seller prior
to the Closing Date of its intent to take or acquire any portion of or interest
in the Property (each an "Eminent Domain Taking"), Seller shall give notice
promptly to Buyer of such event and Buyer shall have the option to terminate
this Agreement by providing notice to Seller to such effect on or before the
date which is ten (10) days from Seller's notice to Buyer of such Eminent Domain
Taking or on the Closing Date, whichever occurs first, in which event the Title
Company shall return the Escrowed Amount to Buyer, this Agreement shall
terminate, and neither Seller nor Buyer shall have any recourse against the
other. If Buyer does not timely notify Seller of its election to terminate this
Agreement, Buyer shall purchase the Property and pay the Purchase Price, and
Seller shall pay over or assign to Buyer on delivery of the deed awards
recovered or recoverable by Seller on account of such Eminent Domain Taking up
to the amount of the Purchase Price, less any amounts reasonably expended by
Seller in obtaining such award.
ARTICLE 9
BROKERAGE COMMISSIONS
Seller and Buyer each mutually represent and warrant to the other that
they have not dealt with, and are not obligated to pay, any fees or commissions
to any broker in connection with the transaction contemplated by this Agreement
other than Insignia/ESG Capital Advisors (the "Broker"). Seller agrees to pay
all commissions, payments and fees due to the Broker. Buyer agrees to indemnify,
defend and hold Seller harmless from and against all liabilities, costs, damages
and expenses (including reasonable attorneys' fees) arising from any claims for
brokerage or finder's fees, commissions or other similar fees in connection with
the transaction covered by this Agreement insofar as such claims shall be based
upon alleged arrangements or agreements made by Buyer or on Buyer's behalf.
Seller hereby agrees to indemnify, defend and hold Buyer harmless from and
against all liabilities, costs, damages and expenses (including reasonable
attorneys' fees) arising from any claims for brokerage or finders' fees,
commissions or other similar fees, including any claim made by the Broker, in
connection with the transaction covered by this Agreement as such claims shall
be based upon alleged arrangements or agreements made by Seller or on Seller's
behalf. The covenants and agreements contained in this Article shall survive the
termination of this Agreement or the Closing of the transaction contemplated
hereunder.
ARTICLE 10
DEFAULT, TERMINATION AND REMEDIES
10.1 Seller's Default. In the event that Seller shall have failed in any
material respect adverse to Buyer as of the Closing Date to have performed any
of the covenants and agreements contained in this Agreement which are to be
performed by Seller on or before the Closing Date or Seller defaults in its
obligation to close hereunder, Buyer shall have the right to terminate this
Agreement and receive the Escrowed Amount back from Seller, whereupon this
Agreement shall terminate without further recourse. Buyer hereby waives and
relinquishes any right to sue Seller for any reason whatsoever, except as
expressly set forth in this Section 10.1, and agrees that Seller shall not be
liable to Buyer for any actual, punitive, speculative, consequential or other
damages for breach by Seller prior to the Closing, except for payment of the
Escrowed Amount.
10.2 Buyer's Default. In the event that Buyer shall have failed in any
material respect adverse to Seller as of the Closing Date to have performed any
of the covenants and agreements contained in this Agreement which are to be
performed by Buyer on or before the Closing Date, or if Buyer defaults in its
obligation to close hereunder, Seller shall be entitled to receive the Escrowed
Amount as liquidated damages, in lieu of all other remedies available to Seller
at law or in equity for such default, and Buyer shall direct the Title Company
to release the Escrowed Amount to Seller. Seller and Buyer agree that the
damages resulting to Seller as a result of such default by Buyer as of the date
of this Agreement are difficult or impossible to ascertain and the liquidated
damages set forth in the preceding sentence constitute Buyer's and Seller's
reasonable estimate of such damages.
ARTICLE 11
REPRESENTATIONS AND WARRANTIES
11.1 Buyer's Representations and Warranties. Buyer represents and warrants
to Seller that:
(a) Buyer is a corporation, duly organized and in good standing
under the laws of the State of New York, is qualified, or at the time of closing
will be qualified, to do business in the State of Maryland and has the power and
authority to enter into this Agreement and to execute and deliver this Agreement
and to perform all duties and obligations imposed upon it hereunder. As of the
date of this Agreement, Buyer has obtained all necessary corporate, partnership
or other organizational authorizations required in connection with the execution
and delivery of this Agreement.
(b) Neither the execution nor the delivery of this Agreement, nor
the consummation of the purchase and sale transaction contemplated hereby, nor
the fulfillment of or compliance with the terms and conditions of this Agreement
conflict with or will result in the breach of any of the terms, conditions or
provisions of any agreement or instrument to which Buyer is a party or by which
Buyer or any of Buyer's assets is bound;
(c) Buyer has the financial resources to timely consummate the
purchase and sale transaction contemplated by this Agreement;
(d) Buyer is not in any way affiliated with Seller;
(e) Neither Buyer nor any affiliate of Buyer has defaulted under any
financing provided by or insured by HUD, FHA or any other governmental entity
and further knows of no reason why the transfer of the real property to and the
assumption of the Loan Documents by Buyer would not be approved by either HUD or
Lender.
As a condition precedent to Seller's obligation to close the purchase and
sale transaction contemplated in this Agreement, Buyer's representations and
warranties contained herein must remain and be true and correct as of the
Closing Date. Prior to the Closing Date, Buyer shall notify Seller in writing of
any facts, conditions or circumstances which render any of the representations
and warranties set forth in this Section 11.1 in any way inaccurate, incomplete,
incorrect or misleading.
11.2 Seller's Representations and Warranties. Seller represents and
warrants to Buyer that Seller has the full right, power, and authority, without
the joinder of any other person or entity, to enter into, execute and deliver
this Agreement, and to perform all duties and obligations imposed on Seller
under this Agreement, except to the limited extent, if any, specifically and
expressly set forth in this Agreement.
ARTICLE 12
MISCELLANEOUS
12.1 Successors and Assigns. Buyer may only assign or transfer its rights
under this Agreement, to an entity owned or controlled by Buyer or which owns or
controls Buyer, or to any entity which acquires all or substantially all of the
Buyer's assets, unless such assignment or transfer would affect the Lender's
consent or timing of the Closing. The covenants and agreements contained in this
Agreement shall extend to and be obligatory upon the permitted successors and
assigns of the respective parties to this Agreement. In addition, Buyer may
assign its rights, but not its obligations under this Agreement to a qualified
intermediary in connection with a like kind exchange.
12.2 Notices. Except as otherwise specifically provided herein, any notice
required or permitted to be delivered under this Agreement shall be in writing
and shall be deemed given (i) when delivered or refused if sent by hand during
regular business hours, (ii) three (3) days after being sent by United States
Postal Service, registered or certified mail, postage prepaid, return receipt
requested, or (iii) on the next business day when sent by a reputable overnight
express mail service that provides tracing and proof of receipt or refusal of
items mailed, addressed to Seller or Buyer, as the case may be, at the address
or addresses set forth below or such other addresses as the parties may
designate in a notice similarly sent. Any notice given by a party to Title
Company shall be simultaneously given to the other party. Any notice given by a
party to the other party relating to its entitlement to the Escrowed Amount
shall be simultaneously given to the Title Company.
(1) If to Seller:
c/o Paine Webber Properties Incorporated
265 Franklin Street - 16th Floor
Boston, MA 02110
Attn: Mr. Rock D'Errico
and
JBG/Carriage Hill Village Limited Partnership
1250 Connecticut Avenue, NW
Suite 500
Washington, DC 20036
Attn: Mr. Michael J. Glosserman
with a copy to:
Goodwin, Procter & Hoar LLP
Exchange Place
Boston, MA 02109
Attn: Andrew C. Sucoff, Esq.
(2) If to Buyer:
c/o Arbor National Commercial Mortgage, LLC
333 Earle Ovington Boulevard, 9th Floor
Uniondale, New York 11553
with a copy to:
Jack L. Libert, Esq.
377 Oak Street
Garden City, NY 11530
<PAGE>
(3) If to the Title Company:
Chicago Title Insurance Company
101 Federal Street
Boston, MA
12.3 Construction. Words of any gender used in this Agreement shall be
held and construed to include any other gender, and words of a singular number
shall be held to include the plural and vice versa, unless the context requires
otherwise.
12.4 Captions. The captions used in connection with the Articles of this
Agreement are for convenience only and shall not be deemed to extend, limit or
otherwise define or construe the meaning of the language of this Agreement.
12.5 No Other Parties. Nothing in this Agreement, express or implied, is
intended to confer upon any person, other than the parties hereto and their
respective successors and assigns, any rights or remedies under or by reason of
this Agreement.
12.6 Amendments. This Agreement may be amended only by a written
instrument executed by Seller and Buyer (or Buyer's assignee or transferee).
12.7 Entire Agreement. This Agreement embodies the entire agreement
between Seller and Buyer with respect to the transaction contemplated in this
Agreement, and there have been and are no covenants, agreements,
representations, warranties or restrictions between Seller and Buyer with regard
thereto other than those set forth or provided for in this Agreement.
12.8 Applicable Law. This Agreement shall be construed under and in
accordance with the laws of state in which the Property is located.
12.9 Counterparts. This Agreement may be executed in two (2) or more
counterparts, each of which shall be an original but such counterparts together
shall constitute one and the same instrument notwithstanding that both Buyer and
Seller are not signatory to the same counterpart.
12.10 [Intentionally Omitted]
12.11 No Personal Liability. The obligations of Seller hereunder shall be
binding only on the Property and neither Buyer nor anyone claiming by, through
or under Buyer shall be entitled to obtain any judgment extending liability
beyond the Property or creating personal liability on the part of the partners
of the Seller or of the officers, directors, shareholders, advisors or agents of
Seller or Seller's partners or any of their successors.
ARTICLE 13
IRS FORM 1099-S DESIGNATION
In order to comply with information reporting requirements of Section
6045(e) of the Internal Revenue Code of 1986, as amended, and the Treasury
Regulations thereunder, the parties agree (1) to execute an IRS Form 1099-S
Designation Agreement in the form attached hereto as Schedule D at or prior to
the Closing to designate the Title Company (the "Designee") as the party who
shall be responsible for reporting the contemplated sale of the Property to the
Internal Revenue Service (the "IRS") on IRS Form 1099-S; (2) to provide the
Designee with the information necessary to complete Form 1099-S; (3) that the
Designee shall not be liable for the actions taken under this Agreement, or for
the consequences of those actions, except as they may be the result of gross
negligence or willful misconduct on the part of the Designee; and (4) that the
Designee shall be indemnified by the parties for any costs or expenses incurred
as a result of the actions taken hereunder, except as they may be the result of
gross negligence or willful misconduct on the part of the Designee. The Designee
shall provide all parties to this transaction with copies of the IRS Forms
1099-S filed with the IRS and with any other documents used to complete IRS Form
1099-S.
[Remainder of Page Intentionally Left Blank]
<PAGE>
IN WITNESS WHEREOF, the parties have executed this instrument as of the day and
year first set forth above.
SELLER:
RANDALLSTOWN CARRIAGE HILL ASSOCIATES
BY: PAINE WEBBER INCOME PROPERTIES FIVE
LIMITED PARTNERSHIP
BY: Fifth Income Properties Fund,
Inc., Managing General Partner
BY: /s/ Rock M. D'Errico
--------------------
Name: Rock M. D'Errico
Title: Vice President
BY: JBG/CARRIAGE HILL VILLAGE LIMITED
PARTNERSHIP
BY: JBG Real Estate Associates IV,
Inc., General Partner
BY: /s/ Benjamin R. Jacobs
----------------------
Name: Benjamin R. Jacobs
Title: President
<PAGE>
SIGNATURE PARTNERS, LLC
BY: PAINE WEBBER INCOME PROPERTIES FIVE
LIMITED PARTNERSHIP
BY: Fifth Income Properties Fund,
Inc., Managing General Partner
BY: /s/ Rock M. D'Errico
--------------------
Name: Rock M. D'Errico
Title: Vice President
BY: JBG/CARRIAGE HILL VILLAGE LIMITED
PARTNERSHIP
BY: JBG Real Estate Associates IV,
Inc., General Partner
BY: /s/ Benjamin R. Jacobs
----------------------
Name: Benjamin R. Jacobs
Title: President
BUYER:
CASTLE VENTURES LIMITED
By: /s/ Gary Milius
---------------
Gary Milius
President
TITLE COMPANY:
CHICAGO TITLE INSURANCE COMPANY
By: /s/ Sharon A. Sbordon
---------------------
Name: Sharon A. Sbordon
Title: Escrow Official
<PAGE>
SPECIAL WARRANTY DEED
THIS DEED, made this 16th day of September, 1998, by and between
RANDALLSTOWN CARRIAGE HILL ASSOCIATES ("SELLER"), party of the first part; and,
CASTLE VENTURES LIMITED ("BUYER"), party of the second part:
WITNESSETH, that in consideration of the sum paid by the Buyer to the
Seller, receipt of which is hereby acknowledged, and which the party of the
first part certifies under the penalties of perjury as the actual consideration
paid or to be paid, including the amount of any mortgage or deed of trust
outstanding, the said party of the first part does grant and convey unto the
party of the second part in fee simple all that property situate in Baltimore
County, State of Maryland, described as:
All of that certain lot or parcel of land, together with all improvements
thereon, located and being in the County of Baltimore, State of Maryland,
and more particularly described as follows:
SEE EXHIBIT "A" ATTACHED HERETO
Subject to covenants, easements and restrictions of record.
TO HAVE AND TO HOLD said land and premises above described or mentioned and
hereby intended to be conveyed, together with the buildings and improvements
thereupon erected, made or being, and all and every title, right, privileges,
appurtenances and advantages thereunto belonging, or in anywise appertaining,
unto and for the proper use only, benefit and behoove forever of said property
of the second part in fee simple.
Being the same property conveyed to the party of the first part by deed
recorded in Liber
folio among the said Land Records.
AND said party of the first part does hereby covenant to warrant specially the
property hereby conveyed.
<PAGE>
IN WITNESS WHEREOF the said party of the first part has hereunto set its hand
and seal on the day and year first hereinbefore written.
SELLER:
RANDALLSTOWN CARRIAGE HILL ASSOCIATES
BY: PAINE WEBBER INCOME PROPERTIES FIVE
LIMITED PARTNERSHIP
BY: Fifth Income Properties Fund,
Inc., Managing General Partner
BY: /s/ Rock M. D'Errico
--------------------
Name: Rock M. D'Errico
Title: Vice President
BY: JBG/CARRIAGE HILL VILLAGE LIMITED
PARTNERSHIP
BY: JBG Real Estate Associates
IV, Inc., General Partner
BY: /s/ Benjamin R. Jacobs
----------------------
Name:Benjamin R. Jacobs
Title: President
CASTLE VENTURES LIMITED
By: /s/ Gary Milius
---------------
President
I certify that this instrument was prepared under the supervision of the
undersigned, an attorney duly admitted to practice before the Court of Appeals
of Maryland.
<PAGE>
CARRIAGE HILL APARTMENTS
RANDALLSTOWN, MARYLAND
BILL OF SALE AND ASSIGNMENT
THIS BILL OF SALE AND ASSIGNMENT (this "Bill of Sale and Assignment") is
executed as of the 16th day of September, 1998, by Randallstown Carriage Hill
Associates, a Maryland general partnership ("Seller"), in favor of Castle
Ventures Limited, a New York corporation ("Purchaser").
In exchange for Ten Dollars ($10) and other good and valuable
consideration, the adequacy, sufficiency and receipt of which are hereby
acknowledged, Seller and Purchaser hereby agree as follows:
1. Real Property. The "Real Property" shall mean the real property
located in Randallstown, Maryland, commonly known as "Carriage Hill
Apartments."
2. Personal Property. The "Personal Property" shall mean those certain
articles of personal property of every kind or description now or hereafter in
or on the Land or the improvements contained thereon to the extent owned by
Seller. Seller hereby assigns all of Seller's right, title and interest, if any,
to the Personal Property to Purchaser.
3. Contracts and Leases. Seller hereby assigns to Purchaser all of
Seller's right, title and interest in and to all contracts for goods and
services rendered in connection with the ownership, operation, management and
leasing of the Real Property (the "Contracts") and all leases, occupancy
agreements, licenses and other agreements for the use or occupancy of any
portion of the Real Property (the "Leases"). Seller agrees to promptly remit to
Purchaser any rents under the Leases which it receives after the date hereof for
the period after the date hereof. Purchaser hereby assumes all the liabilities
and agrees to perform all of the obligations of the Seller from and after the
date hereof pursuant to the Leases and Contracts.
4. As Is. The Personal Property is sold, transferred and delivered by
Seller and hereby accepted by Purchaser in its current "as is" condition,
without any warranties, covenants or representations by Seller. Without limiting
the generality of the foregoing, the Personal Property is transferred, sold and
delivered without any express or implied warranty of merchantability or fitness.
5. Power and Authority. Seller represents and warrants to Purchaser that it is
fully empowered and authorized to execute and deliver this Bill of Sale and
Assignment, and the individuals signing this Bill of Sale and Assignment on
behalf of Seller each represents and warrants to Purchaser that he or she is
fully empowered and authorized to do so.
6. Counterparts. This Bill of Sale and Assignment may be executed in
multiple counterparts, any or all of which may contain the signatures of fewer
than all of the parties, but all of which shall constitute a single instrument.
<PAGE>
IN WITNESS WHEREOF, Seller and Purchaser have executed this Bill of Sale
and Assignment the day and year first above written.
SELLER:
RANDALLSTOWN CARRIAGE HILL ASSOCIATES
BY: PAINE WEBBER INCOME PROPERTIES FIVE
LIMITED PARTNERSHIP
BY: Fifth Income Properties Fund,
Inc., Managing General Partner
BY: /s/ Rock M. D'Errico
--------------------
Name: Rock M. D'Errico
Title: Vice President
BY: JBG/CARRIAGE HILL VILLAGE LIMITED
PARTNERSHIP
BY: JBG Real Estate Associates
IV, Inc., General Partner
BY: /s/ Benjamin R. Jacobs
----------------------
Name:Benjamin R. Jacobs
Title: President
CASTLE VENTURES LIMITED
By: /s/ Gary Milius
---------------
President
<PAGE>
<TABLE>
Closing Statement
CASTLE VENTURES, LTD. AND COMPANY MOTORS CORP.
Acquisition from
RANDALLSTOWN CARRIAGE HILL AND SIGNATURE PARTNERS, LLC
CARRIAGE HILL APARTMENTS (and adjoining land), RANDALLSTOWN, MD
Closing Date: September 16 ,1998
<CAPTION>
Funds Due to Seller
- ---------------------------------------------------------------------------------------
<S> <C> <C>
Purchase Price $37,350,000.00
Deductions
Assumed Debt $27,298,492.24
Total Deductions ($27,298,492.24)
Seller's Credits
See attached $1,168,345.89
Gross Funds Due To Seller $11,219,853.65
--------------
Seller's Disbursements
Mortgage Assumption Fee P.O.C.
Transfer Tax $500,000.00
Insignia/ESG Capital Advisors Commission $255,500.00
Escrow Charges $1,250.00
Total Seller's Disbursements $756,750.00 ($756,750.00)
Net Funds Due To Seller $10,463,103.65
--------------
Funds Due From Buyer
Purchase Price $37,350,000.00
Deductions
Deposit $100,000.00
Assumed Debt $27,298,492.24
--------------
Total Deductions $27,398,492.24 ($27,398,492.24)
Additions
Net Credit to Seller $1,168,345.89
Gross Transfer Tax $933,750.00
less Seller Payment ($500,000.00)
Title Premium $69,035.00
Escrow Charges $750.00
Recording Charges $400.00
Local Searches $2,000.00
National Coordination Fee $2,000.00
---------
Total Additions $1,676,280.89 $1,676,280.89
Net Funds Due From Buyer $11,627,788.65
--------------
SELLER: RANDALLSTOWN CARRIAGE HILL ASSOCIATES
By: /s/ Rock M. D'Errico
--------------------
Rock M. D'Errico
SELLER: SIGNATURE PARTNERS, LLC
By: /s/ Rock M. D'Errico
--------------------
Rock M. D'Errico
BUYER: CASTLE VENTURES LIMITED
By: /s/ Gary Milius
---------------
Gary Milius
BUYER: COMPANY MOTORS CORP.
By: /s/ Gary Milius
---------------
Gary Milius
</TABLE>
