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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549-1004
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) May 16, 1997
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FIRST CAPITAL INSTITUTIONAL REAL ESTATE, LTD. - 2
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(Exact name of registrant as specified in its charter)
Florida 0-12945 59-2313852
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
Two North Riverside Plaza, Suite 1100, Chicago, Illinois 60606-2607
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (312) 207-0020
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(Former name or former address, if changed since last report.)
This document consists of 56 pages.
The Exhibit Index is located on page 3.
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ITEM 2. DISPOSITION OF ASSETS
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First Capital Institutional Real Estate, Ltd. - 1 & 2, d/b/a Lakewood Square
Shopping Center, a joint venture with an Affiliated Partnership (the "Venture")
in which First Capital Institutional Real Estate, Ltd. - 2 (the "Registrant")
owns a 50% interest, sold its interest in the real property commonly known as
Lakewood Square Shopping Center ("Lakewood"), located in Lakewood, California to
M&H Realty Partners III L.P., a California Limited Partnership ("M&H").
The closing of this transaction occurred on May 16, 1997. Lakewood was sold for
cash to an unrelated party pursuant to arm's-length negotiations. The sale price
was $17,750,000, of which the Registrant's share was $8,875,000. Sales Proceeds
received by the Registrant approximated $8,680,000, which was net of actual and
estimated closing expenses. Pursuant to the agreement between the Venture and
M&H, M&H has assumed responsibility for and has indemnified (for one year) the
Venture for costs or other charges related to hazardous substances in the ground
under Lakewood. For the quarter ending June 30, 1997, the Registrant will record
a net gain for financial reporting purposes of approximately $200,000 from this
transaction. The Registrant will distribute $8,658,400 or $102.00 per Unit on
August 31, 1997 to Limited Partners of record as of May 16, 1997.
Page 2
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ITEM 7. PRO FORMA FINANCIAL INFORMATION AND EXHIBITS
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(page 5) Pro Forma Financial Information
Exhibits
2.1 (page 10) Contract for Purchase of Real Property, executed
March 24, 1997, between First Capital Institutional Real
Estate, Ltd. 1 & 2 d/b/a Lakewood Square Shopping Center, a
Florida joint venture (the "Venture") and M&H Realty Partners
III L.P., a California limited partnership ("M&H");
2.2 (page 40) First amendment to Agreement of purchase and sale,
executed April 7, 1997, between the Venture and M&H;
2.3 (page 42) Second amendment to Agreement of purchase and sale,
executed April 25, 1997, between the Venture and M&H;
2.4 (page 46) Closing Statement, dated May 16, 1997, between the
Venture and M&H.
No information is required under Items 1, 3, 4, 5, 6 and 8; therefore, those
Items have been omitted.
Page 3
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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 hereunto duly authorized.
FIRST CAPITAL INSTITUTIONAL REAL ESTATE, LTD. - 2
By: FIRST CAPITAL FINANCIAL CORPORATION
As General Partner
2-Jun-97 By: /s/ NORMAN M. FIELD
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(Date) NORMAN M. FIELD
Vice President - Finance and Treasurer
Page 4
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FIRST CAPITAL INSTITUTIONAL REAL ESTATE, LTD. - 2
The accompanying unaudited Pro Forma Balance Sheet has been presented as if the
sale of Lakewood had occurred on March 31, 1997. The accompanying unaudited Pro
Forma Statement of Income and Expenses for the three months ended March 31, 1997
has been presented as if the sale of Lakewood had occurred on December 31, 1996.
The accompanying unaudited Pro Forma Statement of Income and Expenses for the
year ended December 31, 1996 has been presented as if the sale of Lakewood had
occurred on December 31, 1995. In the opinion of the General Partner, all
adjustments necessary to reflect the financial condition and results of
operations of the Partnership exclusive of the Lakewood have been made. The
unaudited pro forma financial statements are not necessarily indicative of what
the actual financial position and results of operations would have been had such
transaction actually occurred as of December 31, 1995 and 1996 and March 31,
1997, nor do they purport to represent the results of operations of the
Registrant for future periods.
Page 5
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<TABLE>
<CAPTION>
FIRST CAPITAL INSTITUTIONAL REAL ESTATE, LTD. - 2
PRO FORMA BALANCE SHEET
(Unaudited)
(All dollars rounded to nearest 00s)
ASSETS
Pro Forma
March 31, Pro Forma Balance
1997 Adjustments Sheet
------------ ------------ ------------
<S> <C> <C> <C>
Investment in commercial rental properties:
Land $ 10,237,400 $ (2,652,800) $ 7,584,600
Buildings and improvements 36,132,900 (8,816,100) 27,316,800
------------ ------------ ------------
46,370,300 (11,468,900) 34,901,400
Accumulated depreciation and amortization (14,143,300) 3,004,700 (11,138,600)
------------ ------------ ------------
Total investment properties, net of
accumulated depreciation and amortization 32,227,000 (8,464,200) 23,762,800
Cash and cash equivalents 5,030,000 8,680,000 13,710,000
Investment in debt securities 983,300 983,300
Restricted cash 50,000 50,000
Rents receivable 126,700 (38,600) 88,100
Investment in and loans to joint venture 5,606,000 5,606,000
Other assets 43,100 (19,500) 23,600
------------ ------------ ------------
$ 44,066,100 $ 157,700 $ 44,223,800
============ ============ ============
LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
Accounts payable and accrued expenses $ 403,200 $ (43,400) $ 359,800
Due to Affiliates 87,300 87,300
Security deposits 137,600 (22,500) 115,100
Distributions payable 848,900 8,658,400 9,507,300
Other liabilities 70,000 70,000
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1,547,000 8,592,500 10,139,500
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Partners' capital:
General Partner (deficit) (131,300) 131,300 0
Limited Partners (84,886 Units issued
and outstanding) 42,650,400 (8,566,100) 34,084,300
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42,519,100 (8,434,800) 34,084,300
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$ 44,066,100 $ 157,700 $ 44,223,800
============ ============ ============
The accompanying notes are an integral part of the pro forma financial statements.
Page 6
</TABLE>
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FIRST CAPITAL INSITUTIONAL REAL ESTATE, LTD. - 2
PRO FORMA STATEMENT OF INCOME AND EXPENSES
(Unaudited)
(All dollars rounded to nearest 00s
except per Unit amounts)
<TABLE>
<CAPTION>
Three Months Ended March 31, 1997
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Pro Forma
Statement of Statement of
Income and Pro Forma Income and
Expenses Adjustments Expenses
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<S> <C> <C> <C>
Income:
Rental $1,569,500 $(366,600) $1,202,900
Interest 93,300 0 93,300
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1,662,800 (366,600) 1,296,200
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Expenses:
Depreciation and amortization 324,700 (71,600) 253,100
Property operating:
Affiliates 70,900 (18,500) 52,400
Nonaffiliates 250,900 (33,000) 217,900
Real estate taxes 149,000 (28,800) 120,200
Insurance - Affiliate 16,000 (1,200) 14,800
Repairs and maintenance 156,900 (15,300) 141,600
General and administrative:
Affiliates 9,000 9,000
Nonaffiliates 66,400 66,400
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1,043,800 (168,400) 875,400
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Net income before income from partipation in joint venture 619,000 (198,200) 420,800
Income from partipation in joint venture 82,800 82,800
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Net income $ 701,800 $(198,200) $ 503,600
========== ========= ==========
Net income allocated to General Partner $ 84,900 $ (3,100) $ 81,800
========== ========= ==========
Net income allocated to Limited Partners $ 616,900 $(195,100) $ 421,800
========== ========= ==========
Net income allocated to Limited
Partners per Unit (84,886 Units
outstanding) $ 7.27 $ (2.30) $ 4.97
========== ========= ==========
The accompanying notes are an integral part of the pro forma financial statements.
Page 7
</TABLE>
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FIRST CAPITAL INSITUTIONAL REAL ESTATE, LTD. - 2
PRO FORMA STATEMENT OF INCOME AND EXPENSES
(All dollars rounded to nearest 00s
except per Unit amounts)
<TABLE>
<CAPTION>
Year Ended December 31, 1996
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Pro Forma
Statement of
Statement of Pro Forma Income and
Income and Adjustments Expenses
Expenses (Unaudited) (Unaudited)
------------ ----------- ------------
<S> <C> <C> <C>
Income:
Rental $6,342,500 $(1,297,700) $5,044,800
Interest 661,200 661,200
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7,003,700 (1,297,700) 5,706,000
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Expenses:
Depreciation and amortization 1,262,400 (269,100) 993,300
Property operating:
Affiliates 390,000 (62,800) 327,200
Nonaffiliates 912,200 (104,000) 808,200
Real estate taxes 520,600 (103,200) 417,400
Insurance - Affiliate 77,500 (18,200) 59,300
Repairs and maintenance 702,900 (99,300) 603,600
General and administrative:
Affiliates 55,300 55,300
Nonaffiliates 262,900 262,900
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4,183,800 (656,600) 3,527,200
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Net income before income from
partipation in joint venture 2,819,900 (641,100) 2,178,800
Income from partipation in joint
venture 383,300 383,300
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Net income $3,203,200 $ (641,100) $2,562,100
========== =========== ==========
Net income allocated to General
Partner $ 424,400 $ (49,700) $ 374,700
========== =========== ==========
Net income allocated to Limited
Partners $2,778,800 $ (591,400) $2,187,400
========== =========== ==========
Net income allocated to Limited
Partners per Unit (84,886 Units
outstanding) $ 32.74 $ (6.97) $ 25.77
========== =========== ==========
</TABLE>
The accompanying notes are an integral part of
the pro forma financial statements.
Page 8
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FIRST CAPITAL INSTITUTIONAL REAL ESTATE, LTD. - 2
Notes to Pro Forma Balance Sheet and
Pro Forma Statements of Income and Expenses
1) For the purpose of the Pro Forma Balance Sheet:
a) the accounts for land, buildings and improvements, accumulated
depreciation and amortization, rents receivable, other assets, accounts
payable and accrued expenses and security deposits have been adjusted as of
March 31, 1997 to reflect the sale of the Registrant's interest in Lakewood.
b) Cash and cash equivalents has been adjusted to include the net cash
received by the Registrant from the purchaser of Lakewood.
c) Distributions payable has been adjusted to reflect the amount of the
special distribution of Sales Proceeds to Limited Partners as if such
special distribution had been declared as of March 31, 1997.
2) For the purpose of the Pro Forma Statements of Income and Expenses for the
three months ended March 31, 1997 and for the year ended December 31, 1996,
the adjustments to the income and expenses reflect the Registrant's interest
in the operations of Lakewood.
Page 9
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LAKEWOOD SQUARE SHOPPING CENTER
REAL ESTATE SALE AGREEMENT
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THIS REAL ESTATE SALE AGREEMENT (this "Agreement") is made as of the
24th day of March, 1997, by and between FIRST CAPITAL INSTITUTIONAL REAL ESTATE,
LTD.-1 and FIRST CAPITAL INSTITUTIONAL REAL ESTATE, LTD.-2 (collectively, the
"Seller"), each a Florida limited partnership, with an office at c/o Equity
Properties and Development Limited Partnership, Two North Riverside Plaza, Suite
1000, Chicago, Illinois 60606, and M&H REALTY PARTNERS III L.P. ("Purchaser"), a
California limited partnership, with an office at 353 Sacramento Street, Suite
2160, San Francisco, California 94111.
RECITALS
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A. Seller is the owner of a certain parcel of real estate (the "Real
Property") in the City of Lakewood, Los Angeles County, State of California,
which parcel is more particularly described in attached EXHIBIT A, and upon
which is located a shopping center commonly known as "Lakewood Square".
B. Seller desires to sell to Purchaser, and Purchaser desires to
purchase from Seller, the Property (as such term is hereinafter defined), each
in accordance with and subject to the terms and conditions set forth in this
Agreement.
THEREFORE, in consideration of the above Recitals, the mutual
covenants and agreements herein set forth and the benefits to be derived
therefrom, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Purchaser and Seller agree as
follows:
1. PURCHASE AND SALE
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Subject to and in accordance with the terms and conditions set forth
in this Agreement, Purchaser shall purchase from Seller and Seller shall sell to
Purchaser the Real Property, together with: (i) all buildings and improvements
presently situated on, in or under or hereafter erected or installed on, in or
under the Real Property, owned by Seller and any and all of Seller's rights,
easements, licenses and privileges presently thereon or appertaining thereto;
(ii) Seller's right, title and interest in and to the leases (the "Leases")
affecting the Property or any part thereof; (iii) all furniture, furnishings,
fixtures, equipment, maintenance vehicles, tools and other tangible personalty
owned by Seller, located on the Property and used in connection therewith; (iv)
all right, title and interest of Seller under any and all of the maintenance,
service, advertising and other like contracts and agreements with respect to the
ownership and operation of the Property (the "Service Contracts"); (v) all of
Seller's right, title and interest, if any, in all as-built plans, drawings and
specifications for the improvements, and all architectural, structural,
mechanical, electrical and landscaping plans and specifications, surveys,
engineering studies and reports and applicable flood plain maps relating to the
Real Property and in Seller's possession and control (collectively, the
"Plans"); (vi) all of Seller's right, title and interest in any intangible
personal property now or hereafter owned by Seller and used in connection with
the ownership, use and operation of the Real Property or personal property,
including, without limitation, the right, if any, to use any trade name now used
in connection with the Real Property, all warranties or guarantees, if any,
received by Seller from any contractors, subcontractors, suppliers or
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materialmen in connection with any construction, repairs or alterations of the
Real Property, licenses, franchises, permits, tenant lists, advertising
materials and other similar property and rights, if any, relating to the
ownership, use and operation of the Real Property and personal property, but,
with respect to all of the foregoing, only to the extent assignable
(collectively, "Intangible Property"); and (vii) all right, title and interest
of Seller in and to any condemnation award or other awards now pending or made
after Closing, defined below, by any municipal, county, state or federal
authority or board with respect to the Real Property and/or the improvements
thereon; all to the extent applicable to the period from and after the Closing
(as such term is hereinafter defined); (items (i) through (vii) above, together
with the Real Property, are collectively referred to in this Agreement as the
"Property"). All of the foregoing expressly excludes (i) all property owned by
tenants or other users or occupants of the Property, and (ii) all rights with
respect to any refund of taxes applicable to any period prior to the "Closing
Date" (as defined herein).
2. PURCHASE PRICE
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The purchase price to be paid by Purchaser to Seller for the Property
is Eighteen Million Two Hundred Fifty Thousand Dollars ($18,250,000.00) (the
"Purchase Price"). The Purchase Price shall be paid as follows:
A. Earnest Money.
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(i) Upon execution of this Agreement by Purchaser, Purchaser shall
deliver to the Los Angeles office of Chicago Title Insurance Company, 700 South
Flower Street #920, Los Angeles, California 90017, Attention: Marley Harrill,
Telephone: 213/488-4348, Facsimile: 213/891-0834 ("Escrowee") initial earnest
money (the "Initial Earnest Money") in the sum of One Hundred Thousand Dollars
($100,000.00). Purchaser shall, on or before the expiration of the Review
Period, deposit with the Escrowee additional earnest money (the "Additional
Earnest Money") in the sum of Four Hundred Thousand Dollars ($400,000.00)
failing which, this Agreement shall automatically terminate as provided in
Section 8(A) below. The Initial Earnest Money and, if deposited or required to
- ------------
be deposited with the Escrowee, the Additional Earnest Money, together with any
interest earned thereon net of investment costs, are referred to in this
Agreement as the "Earnest Money". Whenever Escrowee is directed to deliver the
Earnest Money to either party hereunder pursuant to any express provision
hereof, such delivery shall be of only so much of the Earnest Money as is then
held by Escrowee. The Earnest Money shall be invested in a federally insured
account as Purchaser so directs. Any and all interest earned on the Earnest
Money shall be reported to Purchaser's federal tax identification number.
(ii) If the transaction closes in accordance with the terms of this
Agreement, at Closing, the Earnest Money shall be delivered by Escrowee to
Seller as partial payment of the Purchase Price. If the transaction fails to
close due to a default on the part of Purchaser, the Earnest Money shall be
promptly delivered by Escrowee to Seller as provided in Sections 7(B) and 7(C).
------------- ----
If the transaction fails to close due to a default on the part of Seller, the
Earnest Money shall be promptly delivered by Escrowee to Purchaser, and
Purchaser shall have the remedy provided for in Section 7(A) below. If this
------------
Agreement is terminated by Purchaser pursuant to any express provision hereof,
and provided Purchaser is not then in default, the Earnest Money shall be
promptly delivered by Escrowee to Purchaser.
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B. Cash at Closing. The Earnest Money shall be applied to the Purchase
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Price at Closing. At Closing, Purchaser shall pay to Seller, by wire transferred
current federal funds, an amount equal to the Purchase Price, minus the sum of
the Earnest Money which Seller receives at Closing from the Escrowee, and plus
or minus, as the case may require, the closing prorations and adjustments to be
made pursuant to Section 4(C) below.
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3. EVIDENCE OF TITLE
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Purchaser acknowledges receipt of a commitment for an ALTA Owner's
Title Insurance Policy together with legible copies of all documents shown as
exceptions to title (collectively, the "Title Commitment"), issued by Chicago
Title Insurance Company (the "Title Insurer"). Purchaser shall have until the
expiration of the Review Period within which to review the condition of title to
the Property. A later-dated commitment shall be provided after the expiration
of the Review Period but prior to Closing (the "Date Down"). If Purchaser is
dissatisfied with the condition of title for any reason prior to the expiration
of the Review Period, Purchaser may terminate this Agreement in the manner
provided in Section 8(A) below. If the Date Down discloses any new exceptions
------------
to title, then Purchaser may, as its sole and exclusive remedy, either (a)
terminate this Agreement, whereupon the Earnest Money shall be immediately
returned to Purchaser, or (b) proceed with consummation of this transaction
notwithstanding such uncured items (and Purchaser's failure to so elect shall be
deemed an election of item (a) above). If Purchaser does not elect to terminate
this Agreement as provided herein, Purchaser shall consummate the Closing and
accept title to the Property subject to all such exceptions. The term
"Permitted Exceptions" shall mean any and all matters disclosed by or set forth
in the Title Commitment, the Date Down, or EXHIBIT B attached hereto with
respect to which Purchaser did not terminate this Agreement as aforesaid.
4. CLOSING
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A. Closing Date. The "Closing" of the transaction contemplated by
------------
this Agreement (that is, the payment of the Purchase Price, the transfer of
title to the Property, and the satisfaction of all other terms and conditions of
this Agreement) shall occur at 8:00 a.m. on the third business day following the
expiration of the Review Period, at the Los Angeles office of the Title Insurer,
or at such other time and place as Seller and Purchaser shall agree in writing.
The "Closing Date" shall be the date of Closing. If the date for Closing above
provided for falls on a Saturday, Sunday or legal holiday, then the Closing Date
shall be the next business day.
B. Closing Documents.
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(i) Seller. At Closing, Seller shall deliver to Purchaser
------
the following:
(a) a "Grant" Deed, subject to Permitted Exceptions, and
in form acceptable to the Title Insurer, duly executed by Seller;
(b) a "special" or "limited" warranty bill of sale
sufficient to transfer to Purchaser title to the tangible personal
property and expressly
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disclaiming any warranties other than as to title as aforesaid, duly
executed by Seller;
(c) a letter advising tenants under the Leases of the
change in ownership of the Property;
(d) an assignment of the Leases and Service Contracts,
duly executed by Seller;
(e) an affidavit stating, under penalty of perjury,
Seller's U.S. taxpayer identification number and that Seller is not a
foreign person within the meaning of Section 1445 of the Internal
Revenue Code, and is not subject to withholding under Section 26131 of
the California Revenue and Taxation Code, duly executed by Seller;
(f) a closing statement to be executed by Seller and
Purchaser, setting forth the prorations and adjustments to the
Purchase Price as required by Section 4(C) below;
------------
(g) an assignment of the Plans and Intangible Property,
if any, duly executed by Seller;
(h) all keys to all locks on the Property (to the extent
that such are available), and all books and records pertaining
exclusively to the Property (but expressly excluding Seller's
forecasts and analysis, and any tax returns of Seller) in the
possession or control of Seller and originals of all documents in the
possession or control of the Seller pertaining to the tenants,
including, without limitation, all applications, correspondence and
credit reports relating to each such tenant (provided, however, that
these deliveries may be made within a reasonable period of time after
Closing);
(i) to the extent in Seller's possession or control, any
assignable permits issued by the appropriate governmental authorities
and utility companies when the improvements were completed, and any
available architectural, structural, mechanical and electrical plans
and specifications used in the construction of the improvements
including, without limitation, the Plans and site surveys;
(j) to the extent in Seller's possession or control,
executed originals of all Leases and Service Contracts; and
(k) such other duly executed and/or acknowledged
instruments as may be reasonably required to evidence the authority of
Seller to enter into this Agreement and consummate the transactions
contemplated hereby, as well as appropriate escrow instructions to
Title Company.
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(ii) Purchaser. Purchaser shall deliver or cause to be
---------
delivered to Seller at Closing:
(a) the funds required pursuant to Section 2(B) above;
------------
(b) an assumption agreement whereby Purchaser assumes all
liabilities and agrees to perform all obligations of Seller under the
Leases and Service Contracts.
(iii) Prior to the expiration of the Review Period, Seller and
Purchaser shall reasonably agree upon the form of all closing documents. If
Seller and Purchaser do not or cannot reasonably agree upon the form of all such
closing documents within the Review Period, then either party may terminate this
Agreement by notice received by the other party prior to the expiration of the
Review Period, whereupon the Initial Earnest Money shall be promptly refunded to
Purchaser. If neither Seller nor Purchaser terminates this Agreement as
aforesaid, then Purchaser's or Seller's failure to so terminate within the
Review Period shall constitute its acceptance of the form of all closing
documents then most recently proposed by Seller.
C. Closing Prorations and Adjustments.
----------------------------------
(i) The following items are to be prorated or adjusted (as
appropriate) as of the close of business on the Closing Date, it being
understood that for purposes of prorations and adjustments, Seller shall be
deemed the owner of the Property on such day and Purchaser shall be deemed the
owner of the Property as of the day after the Closing Date:
(a) real estate and personal property taxes and
assessments (on the basis of the most recent ascertainable tax
bill if the current bill is not then available);
(b) the "minimum" or "base" rent payable by tenants under
the Leases; provided, however, that rent and all other sums which
are due and payable to Seller by any tenant but uncollected as of
the Closing shall not be adjusted, but Purchaser shall cause the
rent and other sums for the period prior to Closing to be
remitted to Seller if, as and when collected. At Closing, Seller
shall deliver to Purchaser a schedule of all such past due but
uncollected rent and other sums owed by tenants. Purchaser shall
include the amount of such rent and other sums in the first bills
thereafter submitted to the tenants in question after the
Closing, and shall continue to do so for twelve (12) months
thereafter. All rents received by Purchaser from any such tenants
after the Closing Date shall be applied in the following order or
priority:
(I) first, to the actual, reasonable, out-of-
pocket costs of collection, if any, incurred by Purchaser for
third party collection agencies in collecting such rent;
(II) then to rent due for the current period;
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(III) then to any month or months following the
Closing Date for which any amounts are due at the time of receipt
of such rent payment;
(IV) then to the month in which the Closing
occurred; and
(V) then to any month or months preceding the
month in which the Closing occurred; provided, however, that
Seller shall have the right to pursue independently (without
initiating an unlawful detainer or involuntary bankruptcy
proceeding), for its own account, any tenant for payment of rent
for any month preceding the month in which Closing occurs.
To the extent not set forth on said schedule, percentage or overage
rent and reimbursement of real estate taxes payable, common area
maintenance, mall maintenance, utility charges, water and sewer
charges, insurance and merchant's association dues and assessments and
all other charges to or contributions by tenants under the Leases
shall be prorated as follows: with respect to percentage rents, and
upon receipt by Purchaser, Purchaser shall furnish to Seller copies of
all sales reports from tenants relative thereto, including, without
limitation, all sales reports with respect to any tenants whose lease
years have expired as of the Closing but whose sales reports were not
available on Closing and sales reports of any tenants whose lease year
expires after the Closing, and the amount of any rents (including,
without limitation, percentage rents), reimbursement or contribution
to be made by any tenant shall be made in accordance with such
tenant's Lease as now existing and Purchaser shall promptly pay to
Seller a pro-rata portion of such rents, reimbursement or
contribution, based upon apportionment being made as of the Closing
Date, promptly after the date when such rents, reimbursement or
contribution is received from the tenant;
(c) Subject to the following sentence, with respect to
tenant improvement costs or leasing commissions relating to Leases, or
any modification, amendment, restatement or renewal thereto, executed
after the date hereof in accordance with the procedures contained in
Section 9(M) hereof (referred to as a "New Lease"), Seller and
------------
Purchaser agree that such costs and commissions shall be prorated over
the term of any New Lease with Seller being responsible for a portion
of such costs and commissions based on the ratio of base rent payments
received by Seller through the Closing Date to the total base rent
payable over the term of the particular New Lease. Notwithstanding
the foregoing, in the event Seller enters into a New Lease with one or
more of Shaw Carpets, Cigarettes Cheaper, and Twin Dragon prior to
Closing (such New Leases, if any, being referred to as "Excluded
Leases"), the Seller shall (i) pay all tenant improvement costs and
leasing commissions due under any Excluded Leases, or (ii) give
Purchaser at Closing a credit against the Purchase Price in the amount
of any such unpaid tenant improvement costs and leasing commissions
due under the Excluded Leases.
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(d) the amount of security deposits paid under the Leases
will be transferred or credited to Purchaser at Closing;
(e) water, electric, telephone and all other utility and
fuel charges, fuel on hand (at cost plus sales tax), and any deposits
with utility companies (to the extent possible, utility prorations
will be handled by meter readings on the day immediately preceding the
Closing Date);
(f) amounts due and prepayments under the Service
Contracts;
(g) assignable license and permit fees; and
(h) other similar items of income and expenses of
operation.
(ii) Notwithstanding the foregoing, Seller shall in all events
be entitled to retain amounts paid by tenants for real estate taxes and
assessments and common area expenses as of the Closing to the extent not in
excess of such taxes and expenses paid by Seller for the period prior to the
Closing Date. Further, for purposes of this Section 4(C), the amount of any
------------
expense credited by one party to the other shall be deemed an expense paid by
that party.
(iii) Notwithstanding anything to the contrary contained in this
Section 4, Seller reserves the right (i) to meet with governmental officials and
- ---------
to contest any reassessment governing or affecting Seller's obligations under
Section 4(C)(i) above and (ii) to contest any assessment of the Property or any
- ---------------
portion thereof and to attempt to obtain a refund for any taxes previously paid;
provided that Purchaser is not subject to civil liability or criminal
prosecution as a result thereof and Purchaser's title to or interest in the
Property, or any portion thereof, is not subjected to forfeiture or involuntary
sale. Seller shall retain all rights with respect to any refund of taxes
applicable to any period prior to the Closing Date.
D. Transaction Costs.
-----------------
Seller and Purchaser agree to each pay one-half (1/2) of the
escrow fees charged in connection with this Agreement. Seller shall pay for the
cost of the title insurance premium for a CLTA standard coverage owner's title
policy, the cost of city and county transfer taxes, and the cost to record the
deed. All other closing and other transaction costs (including, without
limitation, survey charges, sales and use taxes, intangible taxes and similar
taxes or charges, additional title insurance premiums or endorsement charges,
and other recording charges) shall be paid by Purchaser, whether or not the
Closing occurs. Seller and Purchaser shall, however, be responsible for the fees
of their respective attorneys.
E. Possession.
----------
Upon Closing, Seller shall deliver to Purchaser possession of the
Property, subject to such matters as are permitted by or pursuant to this
Agreement.
F. Procedure for Close.
-------------------
7
<PAGE>
Title Company shall close escrow on the Closing Date,
provided it is in a position to issue the Title Policy in the manner required by
this Agreement.
5. CASUALTY LOSS AND CONDEMNATION
------------------------------
If, prior to Closing, the Property or any part thereof shall be
condemned, or destroyed or damaged by fire or other casualty, Seller shall
promptly so notify Purchaser. In such event, provided that either: (i) the
reasonable cost to restore the Property due to such damage or destruction is
greater than One Million Dollars ($1,000,000.00), or (ii) any portion of any of
the parking area or buildings located at the Property is taken and/or condemned,
(items (i) and (ii) are collectively referred to hereinafter as a "Material
Casualty"), then either Seller or Purchaser shall have the option to terminate
this Agreement by delivery of its written termination notice to the other within
fifteen (15) days (and the Closing Date will be extended, if necessary, to allow
either party the full fifteen (15) day period) after Seller's delivery to
Purchaser of its notice of a Material Casualty. If (a) the reasonable cost to
restore the Property due to the aforementioned damage, destruction or
condemnation does not constitute a Material Casualty, or (b) in the event of a
Material Casualty, neither Seller nor Purchaser elects to terminate this
Agreement pursuant to the provisions of the preceding sentence, then Seller and
Purchaser shall consummate the transaction contemplated by this Agreement
without abatement of the Purchase Price for any amounts other than any
deductible amounts payable by Seller under applicable policies of insurance and
Purchaser shall be entitled to receive at Closing the condemnation or insurance
proceeds (or an assignment of the right to such proceeds) (less any amounts
applied against costs incurred or income lost by Seller as a result of such
occurrence) and Seller shall, at Closing, execute and deliver to Purchaser all
customary proofs of loss, assignments of claims and other similar items. If
either Seller or Purchaser elects to terminate this Agreement pursuant to the
provisions of this Section 5, Seller shall promptly notify the Escrowee to
---------
return the Earnest Money and, thereafter, the Earnest Money shall be returned to
Purchaser by the Escrowee, in which event this Agreement shall, without further
action of the parties, become null and void and neither party shall have any
further rights or obligations under this Agreement; provided, however, that the
-------- -------
foregoing shall not limit the parties' recourse against one another under
Sections 6 and 9(G) below.
- ---------- ----
6. BROKERAGE
---------
Seller agrees to pay upon Closing (but not otherwise) a brokerage
commission due to CB Commercial Real Estate Group, Inc. pursuant to the terms of
a separate written agreement. Seller and Purchaser shall each indemnify and
hold the other harmless from and against any and all claims of all other brokers
and finders claiming by, through or under the indemnifying party and in any way
related to the sale and purchase of the Property, this Agreement or otherwise,
including, without limitation, attorneys' fees and expenses incurred by the
indemnified party in connection with such claim.
7. DEFAULT AND REMEDIES
--------------------
A. Notwithstanding anything to the contrary contained in this
Agreement, if Seller fails to perform in accordance with the terms of this
Agreement, then, as Purchaser's sole
8
<PAGE>
and exclusive remedy hereunder and at Purchaser's option, either (i) the Earnest
Money shall be returned to Purchaser, in which event this Agreement shall be
null and void, and neither party shall have any rights or obligations under this
Agreement, or (ii) upon notice to Seller not less than ten (10) days after
Purchaser becomes aware of which failure, and provided an action is filed within
thirty (30) days thereafter, Purchaser may seek performance of this Agreement,
but not damages. Purchaser's failure to seek specific performance as aforesaid
shall constitute its election to proceed under clause (i) above. Notwithstanding
the foregoing, in the event Seller's failure to close the transactions
contemplated by the terms of this Agreement is intentional, willful or in bad
faith, Purchaser shall also be entitled to pursue a claim for damages against
Seller, provided, however, that (i) Purchaser's claim for damages shall be
limited to reimbursement for Purchaser's actual, out-of-pocket costs incurred in
connection with its proposed purchase of the Property, and (ii) any such damages
shall be limited to $60,000.00 in the aggregate.
B. Liquidated Damages - Initial Earnest Money. THE PARTIES
------------------------------------------
ACKNOWLEDGE THAT IN THE EVENT THE SALE OF THE PROPERTY IS NOT CONSUMMATED DUE TO
ANY DEFAULT BY PURCHASER OCCURRING PRIOR TO THE EXPIRATION OF THE REVIEW PERIOD
(AS DEFINED IN SECTION 8(A)), SELLER'S DAMAGES WOULD BE DIFFICULT OR IMPOSSIBLE
------------
TO COMPUTE AND THAT THE INITIAL EARNEST MONEY DEPOSIT MADE BY PURCHASER UNDER
SECTION 2.A(i) REPRESENTS THE REASONABLE ESTIMATE OF SUCH DAMAGES ESTABLISHED BY
- --------------
THE PARTIES THROUGH GOOD FAITH CONSIDERATION OF THE FACTS AND CIRCUMSTANCES
SURROUNDING THE TRANSACTION CONTEMPLATED UNDER THIS AGREEMENT AS OF THE DATE
HEREOF. IN THE EVENT OF SUCH DEFAULT BY PURCHASER UNDER THIS AGREEMENT, SELLER
SHALL BE PAID THE INITIAL EARNEST MONEY DEPOSIT AS LIQUIDATED DAMAGES IN LIEU OF
ANY OTHER CLAIM SELLER MAY HAVE AT LAW OR IN EQUITY (INCLUDING, WITHOUT
LIMITATION, SPECIFIC PERFORMANCE) ARISING BY REASON OF SUCH DEFAULT AND SELLER
SHALL RETAIN ITS RIGHTS UNDER SECTIONS 6 AND 9(G) HEREOF. THE PARTIES HAVE
---------- ----
INITIALED THIS SECTION 7(B) TO ESTABLISH THEIR INTENT SO TO LIQUIDATE DAMAGES.
------------
Seller:_____________________________ Purchaser:_________________________
C. Additional Liquidated Damages - Additional Earnest Money. THE
--------------------------------------------------------
PARTIES ACKNOWLEDGE THAT IN THE EVENT THE SALE OF THE PROPERTY IS NOT
CONSUMMATED DUE TO ANY DEFAULT BY PURCHASER OCCURRING UPON OR AFTER THE
EXPIRATION OF THE REVIEW PERIOD (AS DEFINED IN SECTION 8(A)), SELLER'S DAMAGES
------------
WOULD BE DIFFICULT OR IMPOSSIBLE TO COMPUTE AND THAT THE INITIAL EARNEST MONEY
AND THE ADDITIONAL EARNEST MONEY DEPOSITED (OR REQUIRED TO BE DEPOSITED) BY
PURCHASER UNDER SECTION 2.A(i) REPRESENT THE REASONABLE ESTIMATE OF SUCH DAMAGES
--------------
ESTABLISHED BY THE PARTIES THROUGH GOOD FAITH CONSIDERATION OF THE FACTS AND
CIRCUMSTANCES SURROUNDING THE TRANSACTION CONTEMPLATED UNDER THIS AGREEMENT AS
OF THE DATE HEREOF. IN THE EVENT OF SUCH DEFAULT BY PURCHASER UNDER THIS
AGREEMENT, SELLER SHALL BE PAID THE INITIAL EARNEST MONEY AND THE ADDITIONAL
EARNEST MONEY AS LIQUIDATED DAMAGES IN LIEU OF ANY OTHER CLAIM SELLER MAY HAVE
AT LAW OR IN EQUITY (INCLUDING, WITHOUT LIMITATION, SPECIFIC PERFORMANCE)
ARISING BY REASON OF SUCH DEFAULT AND SELLER SHALL RETAIN
9
<PAGE>
ITS RIGHTS UNDER SECTIONS 6 AND 9(G) HEREOF. THE PARTIES HAVE INITIALED THIS
---------- ----
SECTION 7(C) TOESTABLISH THEIR INTENT SO TO LIQUIDATE DAMAGES. ADDITIONALLY, IF
- ------------
PURCHASER IS REQUIRED TO, BUT DOES NOT, DEPOSIT THE ADDITIONAL EARNEST MONEY AS
PROVIDED FOR IN SECTION 2(A)(i) ABOVE, SUCH AMOUNT SHALL NONETHELESS BE
---------------
RECOVERABLE BY SELLER FROM PURCHASER AS EARNEST MONEY AND WITHOUT PREJUDICE TO
SELLER'S OTHER RIGHTS AND REMEDIES.
Seller:_____________________________ Purchaser:_________________________
D. After Closing, Seller and Purchaser shall, subject to the terms
and conditions of this Agreement, have such rights and remedies as are available
at law or in equity, except that neither Seller nor Purchaser shall be entitled
to recover from the other consequential or special damages.
8. CONDITIONS PRECEDENT
--------------------
A. Review Period. Subject to Section 9(G) below, Purchaser shall
------------- ------------
have from the date hereof through and including 5:00 p.m. on April 7, 1997,
within which to inspect the Property and, subject to the limitations set forth
in Section 9(G) below, perform any and all reasonable tests and analyses of the
------------
Property desired by Purchaser, including, without limitation, discussions with
representatives of the City of Lakewood, and all other local, state and federal
agencies, concerning the Property, and all tests, borings and samplings desired
by Purchaser to determine whether any Hazardous Materials, defined below, are
present on the Property (the "Review Period"). At the expiration of the Review
Period, this Agreement shall automatically terminate and be of no further force
and effect (except for those obligations which expressly survive such
termination), unless, prior to such expiration, Purchaser deposits the
Additional Earnest Money with Escrowee and gives written notice to Seller and
Escrowee that Purchaser is unconditionally satisfied with the physical condition
of the Property, that Purchaser unconditionally waives the automatic termination
provided in this paragraph, and that all Earnest Money is no longer refundable
pursuant to this Section 8(A). If this Agreement automatically terminates,
------------
Purchaser shall be entitled to a refund of the Initial Earnest Money promptly
after receipt by Escrowee and Seller of written notice from Purchaser requesting
such refund and acknowledging that the Agreement is so terminated.
B. Estoppel Certificates. On or before the expiration of the Review
---------------------
Period, Purchaser shall have received estoppel certificates ("Estoppel
Certificates"), dated no more than fifty-five (55) business days prior to
Closing, from (a) all tenants of the Property (and specifically excluding any
party owning or occupying the Vons parcel) occupying at least 9,000 square feet
of space leased, and (b) from other tenants occupying the remaining space leased
as of the date of this Agreement pursuant to valid and existing Leases. For any
tenant occupying at least 9,000 square feet of space leased that has not
returned an Estoppel Certificate, Seller shall have the right (but not the
obligation) to deliver to Purchaser a "Landlord Certificate" in satisfaction of
the Estoppel Certificate condition for such tenant; and for any other tenant
that has not returned an estoppel certificate, Seller agrees to provide such a
"Landlord Certificate". If the foregoing condition has not been satisfied as of
the last day of the Review Period, Seller may unilaterally extend the Review
Period for a period of thirty (30) days solely for purposes of
10
<PAGE>
satisfying the condition. Seller's liability under any Landlord Certificate
shall terminate upon the sooner of: (i) the termination or amendment of the
applicable Lease (provided such termination is not the direct result of a
default or alleged default of the Lease pursuant to a landlord-tenant
controversy), (ii) when Purchaser subsequently obtains an Estoppel Certificate
for the applicable tenant, or (iii) the first (1st) anniversary of the Closing.
The Estoppel Certificates shall be in the form of EXHIBIT C attached hereto, and
otherwise satisfactory to Purchaser in Purchaser's sole discretion. However, the
condition set forth in this Section 8(B) shall be deemed satisfied if Purchaser
------------
fails to terminate this Agreement pursuant to Section 8(A) above.
------------
C. General. Purchaser's obligation to purchase the Property shall
-------
be subject to the fulfillment of the conditions precedent enumerated in this
Section 8(C) within the time limits and in accordance with the procedures set
- ------------
forth below.
(i) Performance. Seller shall have performed and complied
-----------
in all material respects with all of its obligations under this Agreement which
are to be performed or complied with by Seller on or before the Closing;
(ii) Representations and Warranties. All of Seller's
------------------------------
representations and warranties set forth in this Agreement shall be true and
correct in all material respects as of the Closing Date;
(iii) Reciprocal Easement Estoppels. Purchaser shall have
-----------------------------
received a statement from any and all owners of adjoining properties which are
parties to reciprocal easements or similar agreements, reasonably satisfactory
to Purchaser, that there are no defaults by Seller thereunder and the easements
are in full force and effect, each of which shall have been duly executed and
dated not earlier than forty-five (45) days before the Closing; and
(iv) Title Policy. As a condition of Closing, Title Company
------------
shall be committed to issue, upon payment of its regularly scheduled premium,
its owner's extended ALTA Form B 1970 rev. 1984 coverage policy of title
insurance, in the amount of the Purchase Price, showing title to the Property
vested of record in Purchaser or its assignee, subject to no exceptions,
conditions, easements, reservations or encumbrances of any kind or character,
other than the Permitted Exceptions, together with any endorsement to which the
Title Company has committed to issue in writing prior to the expiration of the
Review Period (the "Title Policy").
D. Right of Entry; Indemnification. Subject to the limitations of
-------------------------------
Section 9(G), Seller shall allow Purchaser (and its authorized representatives
- ------------
and agents) reasonable access to the Property during normal business hours and
after reasonable prior notice to Seller, to the documents, permits and
agreements maintained in connection therewith, and to all governmental
authorities connected therewith, for the purpose of making such appraisals,
examination, tests, analyses, investigations, borings, surveys, inquiries, or
other reasonable inspections, as well as access to, with the right to make
copies of, the books and records of the Property maintained at the Property or
at the offices of Seller's property manager. Purchaser shall indemnify, defend
and hold Seller harmless from any and all loss, cost, damage, injury, claim,
liability or expense arising out of claims of injury to or death of persons,
damage to
11
<PAGE>
property, or claims of lien for work or labor performed, materials or supplies
furnished as a result of the exercise of Purchaser's right of entry hereunder.
9. MISCELLANEOUS
-------------
A. All understandings and agreements heretofore had between Seller
and Purchaser with respect to the Property are merged in this Agreement, which
alone fully and completely expresses the agreement of the parties. Purchaser
acknowledges that it has inspected or will inspect the Property and that it
accepts same in its "as is" condition subject to use, ordinary wear and tear and
natural deterioration. Purchaser further acknowledges that, except as expressly
provided in this Agreement, neither Seller nor any agent or representative of
Seller has made, and Seller is not liable for or bound in any manner by, any
express or implied warranties, guaranties, promises, statements, inducements,
representations or information pertaining to the Property.
B. Seller may assign or otherwise transfer its interest under this
Agreement. As used in this Agreement, the term "Seller" shall be deemed to
include any assignee or other transferee of any Seller. Without limiting the
foregoing, Purchaser specifically reserves the right to take title to the
Property in a name or by an assignee other than that of Purchaser, and Purchaser
may at any time prior to the Closing assign all of its rights hereunder, and
Seller shall be bound thereby provided further that (i) said assignee assumes
all of Purchaser's obligations hereunder as if such assignee were the original
Purchaser, and (ii) the original Purchaser hereunder shall remain liable under
this Agreement. Subject to the foregoing, this Agreement shall inure to the
benefit of and shall be binding upon Seller and Purchaser and their respective
successors and assigns.
C. This Agreement shall not be modified or amended except in a
written document signed by Seller and Purchaser.
D. Time is of the essence of this Agreement.
E. This Agreement shall be governed and interpreted in accordance
with the laws of the State of California.
F. All notices, requests, demands or other communications required
or permitted under this Agreement shall be in writing and delivered personally,
by certified mail, return receipt requested, postage prepaid, by overnight
courier (such as Federal Express), or by facsimile transmission (with a copy to
follow by either overnight courier or certified mail, return receipt requested,
postage prepaid), addressed as follows:
12
<PAGE>
1. If to Seller:
c/o Equity Properties and Development Limited Partnership'
Two North Riverside Plaza, Suite 1000'
Chicago, Illinois 60606
Attention: George C. Touras, General Counsel
Telephone: (312) 466-3635
Facsimile: (312) 454-1107
With a copy to:
Rosenberg & Liebentritt, P.C.
Suite 1515
Two North Riverside Plaza
Chicago, Illinois 60606
Attention: John P. Starkweather
Telephone: (312) 466-3613
Facsimile: (312) 454-0335
2. If to Purchaser:
M&H Realty Partners III L.P.
353 Sacramento Street, Suite 2160
San Francisco, California 94111
Attention: Bradley A. Geier
Telephone: (415) 693-9000
Facsimile: (415) 693-0480
With a copy to:
Heller Erhman White & McAuliffe
333 Bush Street
San Francisco, California 94104
Attention: Philip H. Ebling
Telephone: (415) 772-6000
Facsimile: (415) 772-6268
All notices given in accordance with the terms hereof shall be deemed received
forty-eight (48) hours after posting, or when delivered personally or otherwise
received. Either party hereto may change the address for receiving notices,
requests, demands or other communication by notice sent in accordance with the
terms of this Section 9(F).
------------
G. Purchaser's right of inspection pursuant to Section 8 above shall
---------
be subject to the rights of tenants under the Leases and other occupants and
users of the Property. No inspection shall be undertaken without reasonable
prior notice to Seller. Seller shall have the right to be present at any or all
inspections. Neither Purchaser nor its agents or representatives shall contact
any tenants without the prior consent of Seller, such consent not to be
unreasonably
13
<PAGE>
withheld. No inspection shall involve the taking of samples or other physically
invasive procedures without the prior consent of Seller, such consent not to be
unreasonably withheld (other than for any testing, the results of which may be
subject to a reporting requirement of any governmental authority or agency).
Notwithstanding anything to the contrary contained in this Agreement, Purchaser
shall indemnify and hold Seller and its employees and agents, and each of them,
harmless from and against any and all losses, claims, damages and liabilities
(including, without limitation, reasonable attorneys' fees incurred in
connection therewith) arising out of or resulting from Purchaser's exercise of
its rights under this Agreement, including, without limitation, its right of
inspection as provided for in Section 8 above (excepting, however, any
---------
diminution in value of the Property resulting from the mere discovery of any
adverse matter).
H. Seller represents and warrants to Purchaser that it holds fee
simple title to the Property. The foregoing representation and warranty,
however, shall not survive the Closing.
I. (a) Purchaser and Seller acknowledge that the Property is
impacted by certain environmental conditions described in the Remedial Work
Plan, prepared by ENSR, One Hour Martinizing, 4009 Hardwick Street, Lakewood,
California, Document Number 2570-043-200, dated January, 1997 and delivered on
January 13, 1997, as revised January 27, 1997 and delivered on January 30, 1997
(the "Plan"), a copy of which has been delivered to Purchaser. The term
"Hazardous Materials" means those volatile organic compounds and hazardous
materials described in the Plan, but without regard to the amount or extent of
the contamination which has not yet been fully defined. Purchaser assumes the
obligation, if any, to remedy the Hazardous Materials in the manner required by
law (such obligation to remedy being hereinafter described as the "Remediation
Work"). In connection with the Remediation Work, Purchaser and Seller also
agrees as follows:
1. Purchaser shall cause its contractors and consultants to
obtain all required permits and approvals with respect to the Remediation Work
and to perform such work in accordance with applicable laws, and shall cause
such permits and approvals to be issued in Purchaser's name, and to utilize
Purchaser's own EPA generator number with respect to the removal of any
hazardous materials from the Property.
2. Purchaser shall pay all costs in connection with the
Remediation Work, including, without limitation, the costs for all
investigation, installation, operation, maintenance, testing and monitoring
costs, all power and utility costs and any and all pumping taxes or fees that
may be applicable to Seller's activities.
3. Purchaser shall indemnify, hold harmless and defend
Seller, its general and limited partners, officers, directors, employees and
agents (each an "Indemnitee"), against and from any and all claims, demands,
losses, liabilities, costs, damages, expenses, clean-up costs required by, and
fines and damages imposed by, governmental agencies with jurisdiction over the
Property (which costs may include, without limitation, response, removal and
remedial action costs, natural resources, damages and treble or other penalties
or stipulated damages, and which fines and damages may include, without
limitation, consequential and tort damages), and all reasonable costs and
expenses incurred by Purchaser (which costs and expenses may include, without
limitation, consulting and investigation fees and attorneys fees), arising from
the environmental contamination of the Property described in
14
<PAGE>
the Plan (the"Environmental Indemnity").
4. Promptly after receipt by an Indemnitee of notice
of any claim, such Indemnitee will deliver to Purchaser written notice thereof,
and Purchaser shall have the right to participate in and (so long as Purchaser
agrees in writing that it will be responsible for any costs, expenses,
judgments, damages, and losses incurred by the Indemnitee with respect to such
claim) to assume the defense thereof, with counsel mutually satisfactory to the
parties. Such an Indemnitee shall give appropriate waivers of conflicts of
interest, except that an Indemnitee shall have the right to retain its own
counsel, with the fees and expenses to be paid by Purchaser, if the Indemnitee
reasonably believes that representation of such Indemnitee by the counsel
retained by Purchaser would be inappropriate due to actual or potential
differing interests between such Indemnitee and any other party represented by
such counsel in such proceeding. The failure of an Indemnitee to deliver written
notice to Purchaser within a reasonable time after the Indemnitee receives
notice of any such claim shall relieve Purchaser of any liability to the
Indemnitee under the Environmental Indemnity only if and to the extent that such
failure is prejudicial to Purchaser's ability to defend such action, and the
omission to so deliver written notice to Purchaser will not relieve it of any
liability that it may have to any other Indemnitee under the Environmental
Indemnity. If an Indemnitee settles a claim without the prior written consent of
Purchaser, then Purchaser shall be released from liability with respect to such
claim unless Purchaser has unreasonably withheld such consent.
5. Seller agrees to convey and deliver to Purchaser
at Closing any rights, demands, causes of action or other claims it may have
against current or former tenants of the Property related in any manner to the
Hazardous Materials or the cost of the Remediation Work. However, the foregoing
shall not be deemed to require Seller to pay to Purchaser any rents collected by
Seller from any such tenants prior to the Closing Date.
(b) ACKNOWLEDGING THE PRIOR USE OF THE PROPERTY AND PURCHASER'S
OPPORTUNITY TO INSPECT THE PROPERTY, PURCHASER AGREES TO TAKE THE PROPERTY "AS
IS" WITH ALL FAULTS AND CONDITIONS THEREON. ANY INFORMATION, REPORTS,
STATEMENTS, DOCUMENTS OR RECORDS ("DISCLOSURES") PROVIDED OR MADE TO PURCHASER
OR ITS CONSTITUENTS BY SELLER, ITS AGENTS OR EMPLOYEES CONCERNING THE
ENVIRONMENTAL CONDITION OF THE PROPERTY SHALL NOT BE REPRESENTATIONS OR
WARRANTIES. PURCHASER SHALL NOT RELY ON SUCH DISCLOSURES, BUT RATHER, PURCHASER
SHALL RELY ONLY ON ITS OWN INSPECTION OF THE PROPERTY. PURCHASER ACKNOWLEDGES
AND AGREES THAT, EXCEPT AS SPECIFICALLY SET FORTH IN THIS AGREEMENT, SELLER HAS
NOT MADE, DOES NOT MAKE AND SPECIFICALLY DISCLAIMS ANY REPRESENTATIONS,
WARRANTIES, PROMISES, COVENANTS, AGREEMENTS OR GUARANTIES OF ANY KIND OR
CHARACTER WHATSOEVER, WHETHER EXPRESS OR IMPLIED, ORAL OR WRITTEN, PAST, PRESENT
OR FUTURE, OF, AS TO, CONCERNING OR WITH RESPECT TO (A) THE NATURE, QUALITY OR
CONDITION OF THE PROPERTY, INCLUDING, WITHOUT LIMITATION, THE WATER, SOIL AND
GEOLOGY, (B) THE INCOME TO BE DERIVED FROM THE PROPERTY, (C) THE SUITABILITY OF
THE PROPERTY FOR ANY AND ALL ACTIVITIES AND USES WHICH PURCHASER MAY CONDUCT
THEREON, (D) THE COMPLIANCE OF OR BY THE PROPERTY OR ITS OPERATION WITH ANY
LAWS, RULES, ORDINANCES OR REGULATIONS OF ANY APPLICABLE GOVERNMENTAL AUTHORITY
OR BODY, (E) THE HABITABILITY, MERCHANTABILITY OR FITNESS FOR A PARTICULAR
PURPOSE OF THE PROPERTY, OR
15
<PAGE>
(F) ANY OTHER MATTER WITH RESPECT TO THE PROPERTY, AND SPECIFICALLY DISCLAIMS
ANY REPRESENTATIONS REGARDING TERMITES OR WASTES, AS DEFINED BY THE U.S.
ENVIRONMENTAL PROTECTION AGENCY REGULATIONS AT 40 C.F.R., OR ANY HAZARDOUS
SUBSTANCE, AS DEFINED BY THE COMPREHENSIVE ENVIRONMENTAL RESPONSE COMPENSATION
AND LIABILITY ACT OF 1980 ("CERCLA"), AS AMENDED, AND REGULATIONS PROMULGATED
THEREUNDER. THE ENVIRONMENTAL CONDITIONS INCLUDE THE PRESENCE OF THOSE VOLATILE
ORGANIC COMPOUNDS DESCRIBED IN THE PLAN. PURCHASER, ITS SUCCESSORS AND ASSIGNS,
HEREBY WAIVE, RELEASE AND AGREE NOT TO MAKE ANY CLAIM OR BRING ANY COST RECOVERY
ACTION OR CLAIM FOR CONTRIBUTION OR OTHER ACTION OR CLAIM AGAINST SELLER OR ITS
AFFILIATES, DIRECTORS, OFFICERS, EMPLOYEES, AGENTS, ATTORNEYS, OR ASSIGNS
(COLLECTIVELY, "SELLER AND ITS AFFILIATES") BASED ON (A) ANY FEDERAL, STATE, OR
LOCAL ENVIRONMENTAL OR HEALTH AND SAFETY LAW OR REGULATION, INCLUDING CERCLA OR
ANY STATE EQUIVALENT, OR ANY SIMILAR LAW NOW EXISTING OR HEREAFTER ENACTED, (B)
ANY DISCHARGE, DISPOSAL, RELEASE, OR ESCAPE OF ANY CHEMICAL, OR ANY MATERIAL
WHATSOEVER, ON, AT, TO, OR FROM THE PROPERTY (INCLUDING, WITHOUT LIMITATION,
THOSE DESCRIBED IN THE PLAN); OR (C) ANY ENVIRONMENTAL CONDITIONS WHATSOEVER ON,
UNDER, OR IN THE VICINITY OF THE PROPERTY (INCLUDING, WITHOUT LIMITATION, THOSE
DESCRIBED IN THE PLAN).
With respect to the release set forth herein relating to unknown and unsuspected
claims, Purchaser hereby acknowledges that such waiver and release is made with
the advice of counsel and with fully knowledge and understanding of the
consequences and effects of such waiver, and that such waiver is made with the
full knowledge, understanding and agreement that California Civil Code (S) 1542
provides as follows, and that the protection afforded by said Code Section is
hereby waived:
"A General Release does not extend to claims which
the creditor does not know or suspect to exist in
his favor at the time of executing the Release,
which if known by him must have materially affected
his settlement with the Debtor."
Purchaser: M&H REALTY PARTNERS III L.P.
a California limited partnership
By: MHRP III L.P., a California
limited partnership, its general
partner
By: Merlone/Hagenbuch Inc., a
California corporation, its
general partner
By:____________________________
Its:___________________________
16
<PAGE>
J. In any lawsuit or other proceeding initiated by Purchaser
under or with respect to this Agreement, Purchaser waives any right it may have
to trial by jury.
K. Except as may be required by law, without the prior written
consent of Seller, and unless the Closing occurs, Purchaser shall not disclose
to any third party the existence of this Agreement or any term or condition
thereof or the results of any inspections or studies undertaken in connection
herewith; provided, however, that Purchaser may disclose such materials and
information (i) to the extent that Purchaser is required to do so pursuant to
applicable law, (ii) to those of Purchaser's consultants, advisors, attorneys,
brokers, lenders, principals, affiliates or clients who reasonably require such
information, and (iii) following the Closing, for any other valid business
purpose of Purchaser.
L. If for any reason Purchaser does not consummate the Closing,
then Purchaser shall, upon Seller's request, assign and transfer to Seller all
of its right, title and interest in and to any and all studies, reports, surveys
and other information, data and/or documents relating to the Property or any
part thereof prepared by or at the request of Purchaser, its employees and
agents, and shall deliver to Seller copies of all of the foregoing.
M. Seller hereby covenants and agrees with Purchaser that:
1. From and after the date hereof through the expiration
of the Review Period, Seller may enter into any New Lease or new
Service Contract, or any modification, amendment, restatement or
renewal of any existing Service Contracts (collectively, "New
Agreements") without Purchaser's consent, so long as Seller
delivers a copy of any New Agreements to Purchaser prior to the
expiration of the Review Period.
2. Following the expiration of the Review Period through
the Closing Date, Seller shall not enter into any New Agreement
without Purchaser's prior written consent, which will not be
unreasonably withheld or delayed. If Purchaser does not respond
in writing to Seller's request for approval or disapproval of a
New Agreement within three (3) business days after Purchaser's
receipt of Seller's written request, and such request describes
all of the material terms of such New Agreement, Purchaser shall
be conclusively deemed to have approved of such New Agreement.
N. Seller and Purchaser hereby designate Escrowee to act as and
perform the duties and obligations of the "reporting person" with respect to the
transaction contemplated by this Agreement for purposes of 26 C.F.R. Section
1.6045-4(e)(5) relating to the requirements for information reporting on real
estate transaction closed on or after January 1, 1991. In this regard, Seller
and Purchaser each agree to execute at Closing, and to cause the Escrowee to
execute at Closing, a Designation Agreement, designating Escrowee as the
reporting person with respect to the transaction contemplated by this Agreement.
O. Except as expressly set forth in this Agreement, any
representation, warranty, covenant or agreement set forth in this Agreement of
either party to this Agreement
17
<PAGE>
whether to be performed before or after the time of Closing shall not be deemed
to be merged into or waived by the instruments of Closing, but shall expressly
survive Closing and shall be binding on the party obligated thereby for a period
of twelve (12) months after Closing.
P. If it becomes necessary for either party to file a suit to
enforce this Agreement or any provisions contained in this Agreement, the
prevailing party shall be entitled to recover, in addition to any other
available remedy, reasonable attorneys' fees incurred in such suit.
Q. A counterpart of this Agreement with separate but fully
executed signature pages attached thereto shall have the same force and effect
of an original executed instrument.
10. SELLER'S COVENANTS
------------------
From and after the date of this Agreement, Seller agrees with
Purchaser as follows:
A. Estoppel Certificates. Simultaneously with submitting the
---------------------
Estoppel Certificates to the Tenants, Seller shall furnish copies of the
Estoppel Certificates to Purchaser. Seller shall promptly deliver to Purchaser
from time to time all Estoppel Certificates which were returned to Seller.
B. Operation of Property. Seller agrees that:
---------------------
(i) Ordinary Operation. Seller shall manage, operate and
------------------
maintain the Property in the ordinary and usual manner (but Seller shall not be
obligated to make capital improvements or capital repairs) and use commercially
reasonable efforts to preserve its relations with all tenants, suppliers and
others having business dealings with it.
(ii) Labor. Seller shall not make any commitment or incur
-----
any liability to any labor union, through negotiations or otherwise.
C. Tax Proceedings. Real estate tax refunds and credits
---------------
received after the Closing Date but applicable to fiscal tax years prior to
Closing ("Refunds") shall be paid to Seller and shall be apportioned and
distributed as follows: Purchaser and Seller shall first determine whether any
tenant has the right to receive any portion of any Refunds. After payment to any
tenants of any applicable portion of the Refunds, Purchaser shall be entitled to
any portion of any Refunds which are attributable to a fiscal tax year after the
Closing Date. Any Refunds which are attributable to the fiscal tax year during
which the Closing Date occurs shall be equitably apportioned between Seller and
Purchaser. Purchaser shall be absolutely entitled to any Refunds which are
attributable to any fiscal tax year after the Closing Date. Both Seller and
Purchaser agree to immediately notify the other party of any Refunds received by
them.
D. Copies of Notices. Promptly upon receipt, Seller shall
-----------------
provide Purchaser with copies of all material notices and correspondence
received from any Tenant under the Leases, and notices and correspondence
received from any insurance company which carries insurance on the Property or
Board of Fire Underwriters, or from any governmental authority.
18
<PAGE>
E. Prohibition on Marketing. Prior to Closing or earlier
------------------------
termination of this Agreement, Seller shall withdraw the Property from the
market and refrain from offering the Property for sale to any other party and
terminate all negotiations for any such sale with any party other than
Purchaser. Seller can continue to market and show the Property to prospective
purchasers at any time prior to the expiration of the Review Period, and at any
time after Purchaser's default hereunder or the termination of this Agreement.
F. Personal Property. Seller shall not alter or remove any
-----------------
personal property from the Real Property unless the same is replaced with
personal property of the same or similar quality and quantity.
11. REPRESENTATIONS AND WARRANTIES OF SELLER.
----------------------------------------
Seller covenants, represents and warrants to Purchaser that, to
Seller's Knowledge (as hereinafter defined):
A. Leases. There are and will be no oral or written agreements
------
with respect to any Lease allowing the tenant any reduction, abatement,
concession, allowance or subsidy of rent under its Lease or allowing the payment
of any portion of the rent in any form other than in cash except as may be fully
noted on the rent roll ("Rent Roll") attached hereto as EXHIBIT D; and no
rentals or other payments for periods in excess of one month have been received
under any Lease except as reflected on the Rent Roll. Seller is not in violation
of any Lease. Subject to the provisions of Section 4(C)(i)(c), and except for a
------------------
commission which is payable upon the failure of Stroud's, Inc., to terminate its
lease pursuant to its rights thereunder, no brokerage or leasing commission or
other compensation will be due and payable to any person, firm, corporation or
other entity with respect to or on account of any such Lease. Notwithstanding
anything to the contrary set forth in this Agreement, the foregoing
representations and warranties as they relate to any particular Lease shall
cease and be of no further force and effect if and to the extent that Purchaser
receives a tenant estoppel certificate with respect to such Lease and Purchaser
closes the transaction contemplated hereby.
B. Service Contracts. All Service Contracts are valid and in
-----------------
full force and effect and unmodified, and (i) no party has breached any material
condition or provisions of any Service Contract, (ii) no party is in default in
any material respect under the terms of any Service Contract, and (iii) no event
has occurred which with the giving of notice or the passage of time, or both,
would constitute a material default. There are no Service Contracts, as of the
date of this Agreement, except as set forth on EXHIBIT G attached hereto, or as
may be entered into pursuant to the terms of this Agreement.
C. Taxes. All employee, business, sales, rent or other
-----
occupancy taxes due with respect to the Property through the Closing Date have
been or will be paid by Seller and any final returns for such taxes shall be
filed by Seller no later than the date due.
D. Other Rights. No person, firm or entity has any right to
------------
acquire or lease all or any part of the Property, other than the rights of the
tenants under the Leases (including those entered into pursuant to Section
-------
9(M)).
- -----
19
<PAGE>
E. Employees. Seller has no knowledge of any labor grievances,
---------
picketing or similar overt labor problems pending in connection with the
Property.
F. Compliance with Laws. Except as set forth on EXHIBIT E, in
--------------------
connection with the conduct of the business of the Property, Seller has not
received any written notice that it has failed to comply in any material respect
and such failure remains uncured with any applicable law, ordinance, rule or
regulation (including without limitation those relating to zoning) (provided
that no such representation is made with respect to compliance, or lack of
compliance, with the requirements of Title III of the Americans with
Disabilities Act of 1990 [42 U.S.C. 12181, et seq., The Provisions Governing
Public Accommodations and Services Operated by Private Entities]), and all
regulations promulgated thereunder. Seller has not received from any insurance
company any notice, which remains uncured, of any defect or inadequacy in
connection with the Property or its operation. If, and to the extent that,
EXHIBIT E discloses any such written notice, Seller shall attach a copy of such
written notice thereto.
The term "Seller's Knowledge" shall mean the current, actual
knowledge, without investigation or inquiry.
12. WARRANTY OF PERFORMANCE. Seller shall promptly disclose to
-----------------------
Purchaser in writing (a "Warranty Disclosure"), any fact or circumstance known
to or subsequently learned by Seller which would make any warranty or
representation set forth herein untrue or materially misleading as Seller
becomes aware of same. Purchaser shall have five (5) business days after the
receipt of a Warranty Disclosure to either approve or disapprove such Warranty
Disclosure in Purchaser's sole discretion. If Purchaser disapproves such
Warranty Disclosure within such period, then this Agreement shall automatically
terminate, the Deposit shall immediately be returned to Purchaser, and Purchaser
and Seller shall have no further obligations under this Agreement other than
Sections 6 and 9(G). If Purchaser approves (or fails to approve or disapprove on
- ---------- ----
a timely basis), then (i) the representations shall be deemed to be modified in
accordance with such Warranty Disclosure, and (ii) Purchaser shall be deemed to
have waived its rights to terminate the Agreement as a result thereof.
13. EXCHANGE. At the option of either party, such party may elect to
--------
consummate the transaction hereunder in whole or in part as a like-kind exchange
pursuant to Section 1031 of the Internal Revenue Code of 1986, as amended. If
either party (the "Exchanging Party") so elects, the other party (the
"Cooperating Party") shall cooperate with the Exchanging Party, executing such
documents and taking such action as may be reasonably necessary in order to
effectuate this transaction as a like-kind exchange; provided, however, that (i)
the Cooperating Party's cooperation hereunder shall be without cost, expense or
liability to the Cooperating Party of any kind or character, including, without
limitation any attorneys' fees, costs or expense incurred in connection with the
review or preparation of documentation in order to effectuate such like-kind
exchange, and the Cooperating Party shall have no obligation to take title to
any real property; (ii) the Exchanging Party shall assume all risks in
connection with the designation, selection and setting of terms of the purchase
or sale of any exchange property; (iii) the Exchanging Party shall bear all
costs and expenses in connection with any such exchange transaction in excess of
the costs and expenses which would have otherwise been incurred in acquiring or
selling the Property by means of a straight purchase, so that the net effect to
the Cooperating Party shall be identical to that which would have resulted had
this Agreement closed on a purchase and sale; (iv) any
20
<PAGE>
documents to effectuate such exchange transaction are consistent with the terms
and conditions contained in this Agreement; and (v) the Exchanging Party shall
indemnify, defend and hold the Cooperating Party harmless from any and all
claims, demands, penalties, loss, causes of action, suits, risks, liability,
costs or expenses of any kind or nature (including, without limitation,
reasonable attorneys' fees) which the Cooperating Party may incur or sustain,
directly or indirectly, related to or in connection with, or arising out of, the
consummation of this transaction as a like-kind exchange as contemplated
hereunder.
14. INDEMNITIES.
-----------
A. Indemnification by Seller. As of the Closing Date, Seller
-------------------------
shall indemnify, defend, protect and hold Purchaser harmless of and from any and
all liabilities, claims, demands, damages, costs and expenses accruing prior to
the Closing Date which are asserted by third parties and in any way related to
Seller's ownership or operation of the Property prior to the Closing Date, but
only to the extent that the same are covered by Seller's commercial general
liability insurance for the Property, a certificate of which is attached hereto
as EXHIBIT F, and all expenses related thereto including, without limitation,
court costs and attorneys' fees, and specifically excluding the matters which
are the subject of the Environmental Indemnity described above (the "Seller's
Indemnity"). However, the Seller's Indemnity specifically excludes and shall not
apply to any claim based upon (i) any aspect of the environmental condition of
the Property, or (ii) any matter disclosed in any Estoppel Certificate received
from a Tenant. Notwithstanding the foregoing, Seller's indemnification
obligations under this Section 14(A) shall not be limited by the amount of or
-------------
deductible under any such insurance policy that Seller has maintained or may
maintain with respect to the Property. The Seller's Indemnity shall survive the
closing for a period of twelve (12) months, and shall not survive any
termination of this Agreement.
B. Indemnification by Purchaser. As of the Closing Date,
----------------------------
Purchaser shall indemnify, defend, protect and hold Seller harmless of and from
any and all liabilities, claims, demands, damages, costs and expenses, of any
kind or nature accruing on or subsequent to the Closing Date which are asserted
by third parties and in any way related to Purchaser's ownership or operation of
the Property from and after the Closing Date, but only to the extent that the
same are covered by Purchaser's commercial general liability insurance for the
Property, a certificate of which will be delivered prior to Closing, and all
expenses related thereto including, without limitation, court costs and
attorneys' fees (the "Purchaser's Indemnity"). However, the Purchaser's
Indemnity specifically excludes and shall not apply to any claim based upon (i)
any aspect of the environmental condition of the Property, or (ii) any matter
disclosed in any Estoppel Certificate received from a Tenant. Notwithstanding
the foregoing, Purchaser's indemnity obligations under this Section 14(B) shall
-------------
not be limited by the amount of or deductible under any such insurance policy
that Purchaser may maintain with respect to the Property. The Purchaser's
Indemnity shall survive the closing for a period of twelve (12) months, and
shall not survive any termination of this Agreement.
21
<PAGE>
IN WITNESS WHEREOF, Seller and Purchaser have executed and delivered
this Agreement as of the date first above written.
SELLER: FIRST CAPITAL INSTITUTIONAL REAL ESTATE, LTD.-1,
a Florida limited partnership
By: First Capital Financial Corporation, a Florida
corporation, its general partner
By:____________________________
Its:___________________________
FIRST CAPITAL INSTITUTIONAL REAL ESTATE, LTD.-2
a Florida limited partnership
By: First Capital Financial Corporation, a Florida
corporation, its general partner
By:____________________________
Its:___________________________
PURCHASER: M&H REALTY PARTNERS III L.P.
a California limited partnership
By: MHRP III L.P., a California limited partnership,
its general partner
By: Merlone/Hagenbuch Inc., a California corporation,
its general partner
By:_______________________
Its:______________________
EXHIBITS
- --------
A Legal Description
B Permitted Exceptions
C Form of Tenant Estoppel Certificate
D Rent Roll
E Compliance with Laws
F Certificates of Insurance
G List of Service Contracts
22
<PAGE>
EXHIBIT A
LEGAL DESCRIPTION
-----------------
Attached.
A-1
<PAGE>
EXHIBIT B
PERMITTED EXCEPTIONS
--------------------
1. Acts of Purchaser, and those claiming by, through and under Purchaser.
2. General and special taxes and assessments not yet delinquent.
3. Rights of tenants under the Leases, and those claiming by, through and
under said tenants.
4. Zoning, building and other governmental and quasi-governmental laws, codes
and regulations.
5. Any adverse claim to any portion of the Property which has been created by
artificial means or has accreted to any such portion so created and
riparian rights, if any.
6. Covenants, conditions, restrictions, and private or public utility
easements of record together with easements or claims of easements not
shown by the public records.
7. Encroachments, overlaps, boundary line disputes, or other matters which
would be disclosed by an accurate survey or inspection of the Property.
8. Matters disclosed on the attached Title Commitment.
B-1
<PAGE>
EXHIBIT C
FORM TENANT ESTOPPEL CERTIFICATE
--------------------------------
First Capital Institutional Real Estate, Ltd.-1 and -2
c/o Equity Properties and Development Limited Partnership
Two North Riverside Plaza, Suite 1000
Chicago, Illinois 60606
Attention: George C. Touras, General Counsel
M&H Realty Partners III L.P.
353 Sacramento Street, Suite 2160
San Francisco, California 94111
Attention: Bradley A. Geier
Ladies and Gentlemen:
At the request of First Capital Institutional Real Estate, Ltd.-1 and First
Capital Institutional Real Estate, Ltd.-2 ("Landlord"), made in connection with
the proposed sale of the property commonly known as Lakewood Square Shopping
Center, Lakewood, California (the "Property") and Landlord's interest in the
"Lease" (as hereinafter defined) to M&H Realty Partners III L.P. ("Purchaser"),
the undersigned hereby certifies to Landlord and Purchaser as follows:
1. The undersigned is the tenant under a lease with Landlord, dated
__________, 19___, [as amended by _________________, dated __________, 19___
(collectively, the "Lease")][(the "Lease")] for space(s) _______ at the Property
(the "Premises").
2. The Lease sets forth the entire agreement between Landlord and the
undersigned with respect to the Premises, is in full force and effect and has
not been amended, modified or extended, except as described in Paragraph 1
above. Attached hereto is a true, complete and correct copy of the Lease.
3. The monthly [base][minimum] rent of $________ due under the Lease has
been paid through _______, 1997 and all additional rent (consisting of
$_________ per month for estimated operating expenses and estimated real estate
taxes) due under the Lease has been paid through ______________, 1997.
Percentage rent of _____% with a breakpoint of $__________________ is payable on
a [monthly/quarterly annual] basis. Percentage Rent of $______________ due
under the Lease for [describe period] has been paid.
4. The Landlord is not in default under the Lease.
5. The expiration date of the Lease is ____________________, 19___.
6. The amount of the security deposit currently held by Landlord under
the Lease is $ _______________.
C-1
<PAGE>
7. There is no prepaid rent, except $ _____________.
8. The undersigned has not assigned any of its interest in the Lease or
subleased all or any portion of the Premises, except as follows:
_____________________________.
9. The undersigned has no defenses, counterclaims, set-offs or
concessions against rent or charges due or to become due under the Lease.
10. The undersigned has unconditionally accepted the Premises and [has
commenced payment of full rent] [or] [is entitled to _____ month's abatement of
base rent, as of the date hereof] under the Lease and is the owner and holder of
the entire tenant's interest in the Lease.
11. [All work required to be performed by Landlord with respect to the
Lease and in connection with the Premises has been completed by Landlord to the
satisfaction of Tenant except for _________________.] [All amounts to be paid by
Landlord under the Lease with respect to work in the Premises has been paid by
Landlord except for ________________.]
12. The "base year" for operating expense reimbursements and real estate
taxes under the Lease is 19___.
13. The undersigned has no right or option pursuant to the Lease or
otherwise to purchase all or any part of the Premises or the Property, and has
no option to extend or terminate the term of the Lease, except for
___________________________.
14. This Tenant Estoppel Certificate (this "Certificate") shall inure to
the benefit of Landlord, Purchaser and their successors and assigns.
15. If we are a corporation, the undersigned is a duly appointed officer
of the corporation signing this Certificate and is the incumbent in the office
indicated under this Certificate and is the incumbent in the office indicated
under his or her name. In any event, the undersigned is duly authorized to
execute this Certificate.
16. There has not been filed by or against Tenant any petition in
bankruptcy, voluntary or otherwise, or an assignment for the benefit of
creditors, any petition seeking reorganization or arrangement under the
bankruptcy laws of the United States or of any State, or any other action
brought under such bankruptcy laws.
17. Tenant acknowledges that all of Tenant's covenants and representations
contained in this Estoppel Certificate are made with the understanding that
Purchaser shall rely on them in connection with its purchase of the Property.
Very truly yours,
______________________, Tenant
By:_____________________________________
___________________, Title
C-2
<PAGE>
Date: ____________________, 1996
C-3
<PAGE>
EXHIBIT D
RENT ROLL
---------
Attached.
D-1
<PAGE>
EXHIBIT E
LIST OF WRITTEN NOTICES
-----------------------
None.
E-1
<PAGE>
EXHIBIT F
CERTIFICATES OF INSURANCE
-------------------------
Attached.
F-1
<PAGE>
EXHIBIT G
LIST OF SERVICE CONTRACTS
-------------------------
1. Brokerage Agreement with Wilson Commercial Real Estate, dated February 4,
1995, as amended by First Amendment to Brokerage Agreement dated January 1,
1996.
2. Contract for Flat Rate Service with Rockey Murata Landscaping, Inc. dated
April 1, 1994.
3. Contract for Flat Rate Service with Rue-Vac Property Services dated April
11, 1994.
4. Contract for Flat Rate Service with Bon Pest Control dated October 1, 1993.
5. Services Agreement with The Wackenhut Corporation
6. Management Agreement with D.W.A. Smith & Company, Inc. dated March 7, 1985
G-1
<PAGE>
EXHIBIT 2.2
FIRST AMENDMENT TO REAL ESTATE SALE AGREEMENT
---------------------------------------------
[Lakewood Square Shopping Center]
THIS FIRST AMENDMENT TO REAL ESTATE SALE AGREEMENT (this "Amendment")
is made as of the 7th day of April, 1997, by and between FIRST CAPITAL
INSTITUTIONAL REAL ESTATE, LTD.-1 and FIRST CAPITAL INSTITUTIONAL REAL ESTATE,
LTD.-2 (collectively, the "Seller"), each a Florida limited partnership, and M&H
REALTY PARTNERS III L.P. ("Purchaser"), a California limited partnership.
RECITALS
Seller and Purchaser entered into that certain Real Estate Sale
Agreement (the "Purchase Agreement") dated as of March 24, 1997, relating to
certain real estate (the "Property") in the City of Lakewood, Los Angeles
County, State of California, which parcel is more particularly described in
EXHIBIT A to the Agreement. All capitalized terms which are used but not
defined in this Amendment shall have the same respective meanings ascribed to
such terms in the Purchase Agreement. Seller and Purchaser desire to amend the
Purchase Agreement as more particularly set forth below.
THEREFORE, in consideration of the above Recitals, the mutual
covenants and agreements herein set forth and the benefits to be derived
therefrom, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Purchaser and Seller agree as
follows:
1. Review Period. The Review Period is hereby extended to, and shall
-------------
expire at, 5:00 p.m., Chicago, Illinois time on April 25, 1997. The parties
acknowledge that the foregoing extension is intended to give Purchaser until
April 11, 1997, to review the results of certain additional environmental
testing, and two weeks thereafter to perform the balance of its due diligence
investigations. Purchaser agrees that it shall terminate the Purchase Agreement
on or before April 14, 1997, if Purchaser is not satisfied with the results of
the additional environmental testing on or before April 11, 1997.
2. Counterparts. This Amendment may be executed in any number of
------------
counterparts and by the different parties hereto on separate counterparts, each
of which shall be deemed to be an original, and all of such counterparts shall
constitute one agreement. To facilitate execution of this Amendment, the
parties may execute and exchange by telephone facsimile counterparts of the
signature pages.
3. Effect of Amendment. Except as expressly amended hereby, the
-------------------
Purchase Agreement shall remain in full force and effect and otherwise
unmodified.
[signature page follows]
------------------------
<PAGE>
SIGNATURE PAGE TO FIRST AMENDMENT TO REAL ESTATE SALE AGREEMENT
[Lakewood Square Shopping Center]
IN WITNESS WHEREOF, Seller and Purchaser have executed and delivered
this Amendment as of the date first above written.
SELLER: FIRST CAPITAL INSTITUTIONAL REAL ESTATE, LTD.-1,
a Florida limited partnership
By: First Capital Financial Corporation, a
Florida corporation, its general partner
By:__________________________________
Its:_________________________________
FIRST CAPITAL INSTITUTIONAL REAL ESTATE, LTD.-2
a Florida limited partnership
By: First Capital Financial Corporation, a
Florida corporation, its general partner
By:__________________________________
Its:_________________________________
PURCHASER: M&H REALTY PARTNERS III L.P.
a California limited partnership
By: MHRP III L.P., a California limited
partnership, its general partner
By: Merlone/Hagenbuch Inc., a California
corporation, its general partner
By:_____________________________
Its:____________________________
2
<PAGE>
EXHIBIT 2.3
SECOND AMENDMENT TO REAL ESTATE SALE AGREEMENT
----------------------------------------------
[Lakewood Square Shopping Center]
THIS SECOND AMENDMENT TO REAL ESTATE SALE AGREEMENT (this "Amendment")
is made as of the 25th day of April, 1997, by and between FIRST CAPITAL
INSTITUTIONAL REAL ESTATE, LTD.-1 and FIRST CAPITAL INSTITUTIONAL REAL ESTATE,
LTD.-2 (collectively, the "Seller"), each a Florida limited partnership, and M&H
REALTY PARTNERS III L.P. ("Purchaser"), a California limited partnership.
RECITALS
Seller and Purchaser entered into that certain Real Estate Sale
Agreement dated as of March 24, 1997, as amended by First Amendment to Real
Estate Sale Agreement dated as of April 7, 1997 (collectively, the "Purchase
Agreement"), relating to certain real estate (the "Property") in the City of
Lakewood, Los Angeles County, State of California, which parcel is more
particularly described in EXHIBIT A to the Agreement. All capitalized terms
which are used but not defined in this Amendment shall have the same respective
meanings ascribed to such terms in the Purchase Agreement. Seller and Purchaser
desire to amend the Purchase Agreement as more particularly set forth below.
THEREFORE, in consideration of the above Recitals, the mutual
covenants and agreements herein set forth and the benefits to be derived
therefrom, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Purchaser and Seller agree as
follows:
1. Purchase Price. The Purchase Price shall hereafter be Seventeen
--------------
Million Seven Hundred Fifty Thousand and No/100 Dollars ($17,750,000.00).
2. Review Period. The Review Period is hereby extended to, and
-------------
shall expire at, 5:00 p.m., Chicago, Illinois time on May 9, 1997. Purchaser
acknowledges that, as a result of the further testing performed by Seller and by
the accommodations made herein, Purchaser is fully satisfied with the
environmental condition of the Property. As a material inducement to Seller's
entering into this Amendment, and notwithstanding anything in the Purchase
Agreement to the contrary, Purchaser may not terminate the Purchase Agreement
during the Review Period for any reason related to the environmental condition
of the Property. Should Purchaser terminate the Purchase Agreement pursuant to
Section 8(A) thereof, Purchaser agrees to state with specificity the reason or
- ------------
reasons for such termination. The following shall not be understood to limit
the Purchaser's right to terminate the Purchase Agreement for any reason other
than the environmental condition of the Property, in Purchaser's sole
discretion.
3. Counterparts. This Amendment may be executed in any number of
------------
counterparts and by the different parties hereto on separate counterparts, each
of which shall be deemed to be an original, and all of such counterparts shall
constitute one agreement. To facilitate execution of this Amendment, the parties
may execute and exchange by telephone facsimile counterparts of the signature
pages.
<PAGE>
4. Effect of Amendment. Except as expressly amended hereby, the
-------------------
Purchase Agreement shall remain in full force and effect and otherwise
unmodified.
2
<PAGE>
SIGNATURE PAGE TO SECOND AMENDMENT TO REAL ESTATE SALE AGREEMENT
[Lakewood Square Shopping Center]
IN WITNESS WHEREOF, Seller and Purchaser have executed and delivered
this Amendment as of the date first above written.
SELLER: FIRST CAPITAL INSTITUTIONAL REAL ESTATE, LTD.-1,
a Florida limited partnership
By: First Capital Financial Corporation, a Florida corporation,
its general partner
By:_________________________________
Its:________________________________
FIRST CAPITAL INSTITUTIONAL REAL ESTATE, LTD.-2
a Florida limited partnership
By: First Capital Financial Corporation, a Florida corporation,
its general partner
By:_________________________________
Its:________________________________
PURCHASER: M&H REALTY PARTNERS III L.P.
a California limited partnership
By: MHRP III L.P., a California limited partnership,
its general partner
By: Merlone/Hagenbuch Inc., a California corporation,
its general partner
By:_________________________________
Its:________________________________
3
<PAGE>
EXHIBIT 2.4
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
CLOSING STATEMENT INFORMATION
- --------------------------------------------------------------------------------
<S> <C>
PROPERTY NAME: LAKEWOOD SQUARE
SELLER: FIRST CAPITAL INSTITUTIONAL REAL ESTATE, LTD.-1 AND -2
a Florida Limited Partnership
PURCHASER: M&H REALTY PARTNERS III L.P.
a California Limited Partnership
PRORATION DATE: 5/16/97
PRORATION AS OF: 11:59 PM, FRIDAY MAY 16, 1997
CLOSING DATE: 5/16/97
CLOSING AS OF: FRIDAY, MAY 16, 1997
TAX BEGIN DATE: 7/1/96
TAX END DATE: 6/30/97
MONTH BEGIN DATE 5/1/97
MONTH END DATE 5/31/97
</TABLE>
<PAGE>
CLOSING STATEMENT
FOR SALE OF
LAKEWOOD SQUARE
- --------------------------------------------------------------------------------
SELLER: FIRST CAPITAL INSTITUTIONAL REAL ESTATE, LTD.-1 AND -2
a Florida Limited Partnership
PURCHASER: M&H REALTY PARTNERS III L.P.
a California Limited Partnership
PRORATION DATE: 11:59 PM, FRIDAY MAY 16, 1997
CLOSING (FUNDING) DATE: FRIDAY, MAY 16, 1997
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CREDIT CREDIT
PURCHASER SELLER
---------------------- ---------------------
<S> <C> <C>
PURCHASE PRICE 17,750,000.00
EARNEST MONEY (held by Chicago Title Insurance Company, L.A., Calif.) 500,000.00
INTEREST ON EARNEST MONEY POC
PRO-RATE REAL ESTATE TAXES 27,536.87
[See Schedule A]
PRO-RATE MAY, 1997 RETAIL LEASE CHARGES 105,761.62
[See Schedule D]
TENANT PREPAID RENTS 1,027.92
[See Schedule B]
PRO-RATE SERVICE CONTRACTS 0.00
[See Schedule C]
SECURITY DEPOSITS 44,970.95
[See Schedule E]
SHAW'S CARPET TENANT IMPROVEMENT ALLOWANCE 40,000.00
PRO-RATE RET INCOME PAID BY TENANTS 14,334.31
[See Schedule A]
P.S. PLUS...PLUS SIZES RENT ABATEMENT 7,000.00
MISC. 0.00
MISC. 0.00
MISC. 0.00
MISC. 0.00
---------------------- ---------------------
SUBTOTALS 713,094.80 17,777,536.87
CASH AMOUNT DUE TO SELLER 17,064,442.07
---------------------- ---------------------
TOTAL CREDITS 17,777,536.87 17,777,536.87
====================== =====================
</TABLE>
<TABLE>
<S> <C>
APPROVED: SELLER APPROVED: PURCHASER
First Capital Institutional Real Estate, LTD.-1 M&H Realty Partners III L.P.
a Florida Limited Partnership a California Limited Partnership
By:First Capital Financial Corporation, A Florida Corporation By: MHRP III L.P. a California Limited Partnership
Its General Partner Its General Partner
By: ________________________________ By: Merlone/Hagenbuch inc., A California
Corporation,
Its: ________________________________ Its General Partner
First Capital Institutional Real Estate, LTD.-2 By: ________________________________
a Florida Limited Partnership Its: ________________________________
By:First Capital Financial Corporation, A Florida Corporation
</TABLE>
<PAGE>
Its General Partner
By: ________________________________
Its: ________________________________
<PAGE>
- --------------------------------------------------------------------------------
LAKEWOOD SQUARE
SOURCES AND USES STATEMENT
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
PURCHASER'S SOURCES AND USES:
-----------------------------
BALANCE OF CASH TO BE FUNDED BY PURCHASER 17,064,442.07
---------------------
ADDITIONAL CASH OUTLAYS BY PURCHASER:
CHICAGO TITLE INSURANCE COMPANY
Misc. 0.00
Misc.
Misc. 0.00
Misc. 0.00
Misc. 0.00
Misc. 0.00
Misc. 0.00
Misc. 0.00
Misc. 0.00
Misc. 0.00
---------------
PURCHASERS CLOSING COSTS 0.00
---------------------
TOTAL CASH OUTLAY BY PURCHASER 17,064,442.07
- ----------------------------------------------------------------------------------------------------------------
SELLER'S SOURCES AND USES:
--------------------------
EARNEST MONEY 500,000.00
CASH AMOUNT DUE TO SELLER 17,064,442.07
---------------------
TOTAL SELLER'S SOURCES 17,564,442.07
---------------------
ITEMS PAYABLE FROM SELLER'S PROCEEDS AT CLOSING:
CLTA portion of owners policy 12,780.00
Deed Recording Fees (100%) 100.00
Document Transfer Tax 19,525.00
Escrow Fees (50%) 2,400.00
---------------
SELLERS CLOSING COSTS 34,805.00
BROKER COMMISSION PAYABLE TO CB COMMERCIAL 310,625.00
MISC. 0.00
MISC. 0.00
MISC. 0.00
---------------------
TOTAL CASH OUTLAY BY SELLER 345,430.00
---------------------
BALANCE TO SELLER 17,219,012.07
=====================
</TABLE>
<PAGE>
SCHEDULE A
- --------------------------------------------------------------------------------
LAKEWOOD SQUARE
PRO-RATE 7/1/96-6/30/97 PROPERTY TAXES
PRORATION MADE AS OF: 11:59 PM, FRIDAY MAY 16, 1997
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
ACTUAL 1996-1997 REAL ESTATE TAXES:
7155-023-010 46,851.72
7155-023-012 64,443.08
7155-001-022 27,432.07
7155-001-023 7,238.73
7155-001-024 15,458.99
7155-001-025 61,930.06
-------------------
TOTAL 1996-97 REAL ESTATE TAXES: 223,354.65
SELLER'S PRORATA SHARE OF 1996-97 TAXES 320/365 87.671%
-------------------
SELLER'S SHARE OF 1996-97 TAXES 195,817.78
LESS AMOUNT PAID BY SELLER 223,354.65
-------------------
CREDIT DUE TO PURCHASER (SELLER): (27,536.87)
===================
</TABLE>
NOTES:
[1] The 1st and 2nd installments of the 1996-97 real estate taxes have been
paid in full.
- --------------------------------------------------------------------------------
RET INCOME- ANNUAL PAYERS ANALYSIS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
1st Installment 2nd Installment TOTAL
--------------- --------------- -----
<S> <C> <C> <C> <C>
BLOCKBUSTER 10,429.95 10,429.95 20,859.90
CHUCK E. CHEESE 7,587.79 7,587.79 15,175.58
COST PLUS 14,614.73 14,614.73 29,229.46
MICHAEL'S 10,274.25 10,274.25 20,548.50
SAV-ON EXPRESS 6,799.47 6,799.47 13,598.94
STROUD'S LINEN 4,171.98 4,171.98 8,343.96
CLOTHESTIME 4,255.42 4,255.42 8,510.84
TOTAL 1996-97 REAL ESTATE TAXES:PAID 116,267.18
SELLER'S PRORATA SHARE OF 1996-97 TAXES PAID 320/365 87.671%
-------------------
SELLER'S SHARE OF 1996-97 TAXES PAID 101,932.87
LESS AMOUNT PAID TO SELLER FROM TENANT 116,267.18
-------------------
CREDIT DUE TO PURCHASER (SELLER): 14,334.31
===================
</TABLE>
<PAGE>
SCHEDULE B
- -------------------------------------------------------------------------------
LAKEWOOD SQUARE
TENANT PREPAID RENTS
PRORATION MADE AS OF: 11:59 PM, FRIDAY MAY 16, 1997
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
AMOUNT
MERCHANT NAME PREPAID
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
A. CANCER/DISC. SHOP -
BLOCKBUSTER MUSIC -
CASUAL MALE -
CHUCK E. CHEESE -
CIGARETTES CHEAPER -
COST PLUS -
COUNTRY OAK FURNITURE -
CU SERVICE CENTERS 83.23
FAMOUS FOOTWEAR -
MAIL BOXES, ETC. -
MANDARIN PAVILION -
MEN'S WEARHOUSE -
MICHAEL D'AVERSRA SALON -
MICHAEL'S -
MOTO PHOTO -
NATURWAY -
ONE HOUR MARTINIZING -
P.S. PLUS SIZES -
PRECISION SIX -
PWS LAUNDRYLAND -
SAV-ON EXPRESS -
SHAW'S SHOWCASE CARPET -
SHE'S BEAUTY SUPPLY -
SIZES UNLIMITED 688.69
STROUDS LINEN WAREHOUSE -
STYLES FOR LESS 256.00
SUSIE'S DEALS -
TOGO'S EATERY -
TOKYO WOK -
WALLPAPERS FOR LESS -
WESTERN TEMPORARY -
-------------
TOTAL PREPAID RENTS CREDITED TO PURCHASER 1,027.92
================
NOTES: Sizes Unlimited's prepaid consists of the following:
CAM Reconciliation (credit) -1,227.46
1996 TAX Reconciliation (credit) -144.70
Insurance Reconciliation 557.70
Tenant Water 125.77
=============
TOTAL -688.69
=============
CU Service Center's prepaid consists of the following:
Base Rent (credit) 82.23
Styles For Less' prepaid consists of the following:
Base Rent (credit) 256.00
</TABLE>
<PAGE>
SCHEDULE C
- --------------------------------------------------------------------------------
LAKEWOOD SQUARE
RECURRING PAYABLES PRORATION
PRORATION MADE AS OF: 11:59 PM, FRIDAY MAY 16, 1997
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SERVICE CONTRACTS
CREDIT DUE
BILLING PERIOD # of DAYS PURCHASER
VENDOR NAME PAYMENT BEGIN END CREDIT or (SELLER)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
PAID BY SELLER:
The Wackenhut Corporation- (security) 0.00 5/1/97 5/31/97 15 0.00
Energy Resource Maintenance Assoc.- (parking lot lights) 0.00 5/1/97 5/31/97 15 0.00
Rue Vac, INc.- (sweeping & janitorial) 0.00 5/1/97 5/31/97 15 0.00
Coastal High Pressure Cleaning 0.00 5/1/97 5/31/97 15 0.00
Bon Pest Control 0.00 5/1/97 5/31/97 15 0.00
Rocky Murata Landscaping 0.00 5/1/97 5/31/97 15 0.00
------------
TOTAL CREDIT DUE TO PURCHASER (SELLER) 0.00
------------
PAYABLE BY BUYER:
Misc. - 5/1/97 5/31/97 16 0.00
------------
TOTAL CREDIT DUE TO PURCHASER (SELLER) 0.00
------------
NET CREDIT DUE TO PURCHASER (SELLER) 0.00
===========
</TABLE>
<PAGE>
SCHEDULE D
- --------------------------------------------------------------------------------
LAKEWOOD SQUARE
RETAIL TENANTS MONTHLY CHARGES
PRORATION MADE AS OF: 11:59 PM, FRIDAY MAY 16, 1997
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------
TOTAL MAY MAY PURCH. A/R BALANCE
MAY MAY CHARGES CHARGES PRORATA EXCLUDING
MERCHANT NAME RENT CAM RET CHARGES PAID A/R BAL. SHARE MAY CHARGES
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
A. CANCER/DISC SHOP 4,180.35 543.00 340.00 5,063.35 6,083.35 - 2,450.01 0.00
BLOCKBUSTER MUSIC 21,250.00 2,415.00 0.00 23,666.00 23,665.00 - 11,450.81 0.00
CASUAL MALE 5,500.00 623.00 378.00 6,501.00 6,601.00 - 3,145.65 0.00
CHUCK E. CHEESE 10,415.50 2,488.00 0.00 12,883.50 12,883.50 - 6,239.95 0.00
CIGARETTES CHEAPER 1,365.00 200.00 122.00 1,687.00 1,687.00 - 816.29 0.00
COST PLUS 20,571.91 3,222.00 0.00 23,793.91 23,783.91 - 11,519.18 225.00
COUNTRY OAK FURNITURE 2,454.42 662.00 397.00 3,503.42 3,503.42 - 1,895.20 101.75
CU SERVICE CENTERS 3,835.33 653.00 335.00 4,523.39 4,523.39 - 2,188.71 0.00
FAMOUS FOOTWEAR 6,693.75 1,223.00 750.00 8,688.75 8,688.75 - 4,193.59 159.60
MAIL BOXES, ETC. 1,363.68 194.00 123.00 1,680.68 1,680.68 - 819.23 0.00
MANDARIN PAVILION 6,882.06 1,038.00 628.00 8,546.08 8,546.08 0.00 4,195.19 0.00
MEN'S WEARHOUSE 6,300.00 873.00 529.00 7,702.00 7,702.00 - 3,728.77 0.00
MICHAEL D'AVERSRA SALON 3,355.83 498.00 302.00 4,155.83 4,155.83 - 2,010.89 0.00
MICHAEL'S 11,676.21 2,741.00 0.00 14,417.21 14,417.21 - 6,976.07 33.67
MOTO PHOTO 1,841.67 238.00 164.00 2,243.67 2,243.67 - 1,085.85 0.00
NATURWAY 2,827.87 430.00 281.00 3,518.87 3,518.87 - 1,702.68 0.00
ONE HOUR MARTINIZING 3,435.70 473.00 248.00 4,154.70 4,164.70 - 2,010.34 0.00
P.S. PLUS SIZES 8,463.79 1,102.00 721.00 10,286.79 10,286.79 - 4,977.48 0.00
PRECISION SIX 1,316.26 200.00 123.00 1,639.25 1,639.25 - 793.18 180.58
PWS LAUNDRYLAND 1,950.00 324.00 197.00 2,471.00 2,471.00 - 1,195.85 0.00
SAV-ON EXPRESS 12,882.67 1,688.00 0.00 14,251.67 14,251.67 - 6,885.97 0.00
SHAW'S SHOWCASE CARPET 5,200.00 747.00 500.00 6,447.00 6,447.00 - 3,119.52 0.00
SHE'S BEAUTY SUPPLY 1,625.00 270.00 164.00 2,059.00 2,059.00 - 986.29 0.00
SIZES UNLIMITED 12,775.00 1,511.00 920.00 15,206.00 15,206.00 - 7,357.74 0.00
STROUDS LINEN WAREHOUSE 7,233.33 1,083.00 0.00 8,316.33 8,316.33 - 4,024.03 0.00
STYLES FOR LESS 4,318.75 718.00 435.00 5,471.75 5,471.75 - 2,647.62 0.00
SUSIE'S DEALS *% 0.00 580.00 379.00 959.00 959.00 - 464.03 859.00
TOGO EATERY 3,333.34 483.00 252.00 4,088.34 4,088.34 - 1,988.55 0.00
TOKYO WOK 2,275.42 284.00 160.00 2,698.42 2,699.42 - 1,306.17 0.00
VON'S GROCERY 0.00 4,759.00 0.00 4,759.00 4,759.00 - 2,302.74 0.00
WALLPAPERS FOR LESS 1,890.00 287.00 176.00 2,353.00 1,000.00 1,353.00 483.87 1,548.63
WESTERN TEMPORARY 1,779.16 278.00 176.00 2,233.16 2,233.16 - 1,080.68 127.85
------------------------------------------------------------------------------------------------
178,571.88 32,577.00 8,778.00 219,828.98 219,828.98 1,363.00 105,761.82 3,338.08
================================================================================================
<CAPTION>
- ----------------------------------------------------------------------------
TOTAL TOTAL TOTAL
BALANCE SELLERS PURCH.
MERCHANT NAME O/S SHARE O/S SHARE O/S
- ----------------------------------------------------------------------------
<S> <C> <C> <C>
A. CANCER/DISC SHOP - - -
BLOCKBUSTER MUSIC - - -
CASUAL MALE - - -
CHUCK E. CHEESE - - -
CIGARETTES CHEAPER - - -
COST PLUS 225.00 225.00 -
COUNTRY OAK FURNITURE 101.75 101.76 -
CU SERVICE CENTERS - - -
FAMOUS FOOTWEAR 159.60 159.60 -
MAILBOXES, ETC. - - -
MANDARIN PAVILION 0.00 0.00 -
MEN'S WAREHOUSE - - -
MICHAEL D'AVERSRA SALON - - -
MICHAEL'S 33.67 33.87 -
MOTO PHOTO - - -
NATURWAY - - -
ONE HOUR MARTINIZING - - -
P.S. PLUS SIZES - - -
PRECISION SIX 180.58 180.58 -
PWS LAUNDRYLAND - - -
SAV-ON EXPRESS - - -
SHAW'S SHOWCASE CARPET - - -
SHE'S BEAUTY SUPPLY - - -
SIZES UNLIMITED - - -
STROUDS LINEN WAREHOUSE - - -
STYLES FOR LESS - - -
SUSIE'S DEALS *% 959.00 968.00 -
TOGO EATERY - - -
TOKYO WOK - - -
VON'S GROCERY - - -
WALLPAPERS FOR LESS 2,901.63 2,248.85 654.68
WESTERN TEMPORARY 127.85 127.85 -
----------------------------------
4,688.08 4,034.40 654.68
==================================
</TABLE>
NOTES: (1) Tenants denoted with a *% indicate the
tenant pays percentage rent in lieu of base
rent.
(2) Tenants denoted with a *A indicate the
tenant has an abaTement.
<PAGE>
SCHEDULE E
- --------------------------------------------------------------------------------
LAKEWOOD SQUARE
SECURITY DEPOSIT CREDIT
PRORATION MADE AS OF: 11:59 PM, FRIDAY MAY 16, 1997
- --------------------------------------------------------------------------------
SECURITY DEPOSITS
<TABLE>
<S> <C> <C>
MERCHANT NAME
-------------
A. CANCER/DISC. SHOP 4,800.00
BLOCKBUSTER MUSIC -
CASUAL MALE -
CHUCK E. CHEESE -
CIGARETTES CHEAPER -
COST PLUS -
COUNTRY OAK FURNITURE -
CU SERVICE CENTERS -
FAMOUS FOOTWEAR -
MAIL BOXES, ETC. 3,000.00
MANDARIN PAVILION 9,358.94
MEN'S WEARHOUSE -
MICHAEL D'AVERSRA SALON 4,116.00
MICHAEL'S -
MOTO PHOTO 2,050.00
NATURWAY 3,425.86
ONE HOUR MARTINIZING 2,242.50
P.S. PLUS SIZES -
PRECISION SIX 1,639.65
PWS LAUNDRYLAND 2,500.00
SAV-ON EXPRESS -
SHAW'S SHOWCASE CARPET -
SHE'S BEAUTY SUPPLY 2,251.17
SIZES UNLIMITED -
STROUDS LINEN WAREHOUSE -
STYLES FOR LESS -
SUSIE'S DEALS -
TOGO'S EATERY 2,200.00
TOKYO WOK 3,048.00
WALLPAPERS FOR LESS 2,518.83
WESTERN TEMPORARY 1,820.00
----------
TOTAL SECURITY DEPOSITS CREDITED TO PURCHASER 44,970.95
===========
</TABLE>
<PAGE>
SCHEDULE F
- --------------------------------------------------------------------------------
LAKEWOOD SQUARE
DELINQUENCY FROM FORMER TENANTS
PRORATION MADE AS OF: 11:59 PM, FRIDAY MAY 16, 1997
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
AMOUNT
MERCHANT NAME OUTSTANDING
- --------------------------------------------------------------------------------
<S> <C> <C>
CLOTHESTIME 267.65
CRYSTAL ROSE 16,928.58
-----------
TOTAL DELINQUENT AMOUNT DUE SELLER 17,196.23
===========
</TABLE>
