<PAGE>
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 5, 1997
--------------------------------
FIRST CAPITAL INSTITUTIONAL REAL ESTATE, LTD. - 1
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Florida 0-12538 59-2197264
- --------------------------------------------------------------------------------
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
Two North Riverside Plaza, Suite 1100, Chicago, Illinois 60606-2607
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (312) 207-0020
------------------------------
________________________________________________________________________________
(Former name or former address, if changed since last report.)
THIS DOCUMENT CONSISTS OF 93 PAGES.
THE EXHIBIT INDEX IS LOCATED ON PAGE 3.
<PAGE>
ITEM 2. DISPOSITION OF ASSETS
- ------------------------------
Sale of Peachtree
- -----------------
First Capital Institutional Real Estate, Ltd. - 1 (the "Registrant") sold its
interest in the real property commonly known as Peachtree Palisades East Office
Building ("Peachtree"), located in Atlanta, Georgia to Palisades I Associates,
LTD., a Flordia Limited Partnership.
The closing of this transaction occurred on May 5, 1997. Peachtree was sold for
cash to an unrelated party pursuant to arm's-length negotiations. The net sale
price was $7,749,200. Sales Proceeds (as defined in the Registrant's Partnership
Agreement) received by the Registrant approximated $7,440,000, which was net of
actual and estimated closing expenses. For the quarter ending June 30, 1997, the
Registrant will record a net gain for financial reporting purposes of
approximately $1,000,000 from this transaction. The Registrant will distribute
substantially all of the Sales Proceeds from this transaction on August 31,
1997 to Limited Partners of record as of May 5, 1997.
Sale of Lakewood
- ----------------
First Capital Institutional Real Estate, Ltd. - 1 & 2, d/b/a Lakewood Square
Shopping Center, a joint venture (the "Venture") in which 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 and 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. Sale 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
and H, M and 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 $8,640,000 or $144.00 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
- ------- --------------------------------------------
(page 5) Pro Forma Financial Information
Exhibits
2.1 (page 10) Contract for Purchase of Real Property, executed February
xx, 1997, between First Capital Institutional Real Estate, Ltd. - 1, a
Florida limted Partnership ("Seller") and Songy Partners Limted, a
Florida limited Partnership ("Purchaser");
2.2 (page 41) Closing Statement, dated May 5, 1997, between Seller and
Purchaser.
2.3 (page 48) 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, an Florida joint venture
("FCFC") and M&H Realty Partners III L.P., a California limited
partnership ("M&H");
2.4 (page 78) First amendment to agreement of purchase and sale, executed
April 7, 1997, between FCFC and M&H;
2.5 (page 80) Second amendment to Agreement of purchase and sale, executed
April 25, 1997, between FCFC and M&H;
2.6 (page 83) Closing Statement, dated May 16, 1997, between FCFC and M&H.
No information is required under Items 1, 3, 4, 5, 6 and 8; therefore, those
Items have been omitted.
Page 3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
FIRST CAPITAL INSTITUTIONAL REAL ESTATE LTD. - 1
By: FIRST CAPITAL FINANCIAL CORPORATION
As Managing General Partner
May 20, 1997 By: /s/ NORMAN M. FIELD
- ------------ -------------------------------------
(Date) NORMAN M. FIELD
Vice President - Finance and Treasurer
Page 4
<PAGE>
FIRST CAPITAL INSTITUTIONAL REAL ESTATE LTD. - 1
The accompanying unaudited Pro Forma Balance Sheet has been presented as if the
sales of Peachtree and Lakewood (collectively, the "Properties") 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 sales of Properties 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 sales of Properties had occurred
on December 31, 1995. In the opinion of the Managing General Partner, all
adjustments necessary to reflect the financial condition and results of
operations of the Partnership exclusive of the Properties 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 transactions 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
<PAGE>
FIRST CAPITAL INSTITUTIONAL REAL ESTATE, LTD. - 1
PRO FORMA BALANCE SHEET
(Unaudited)
(All dollars rounded to nearest 00s)
ASSETS
<TABLE>
<CAPTION>
Peachtree Lakewood Pro Forma
March 31, Pro Forma Pro Forma Balance
1997 Adjustments Adjustments Sheet
------------- ------------- ------------- -----------
<S> <C> <C> <C> <C>
Investment in commercial rental properties:
Land $ 5,501,700 $ 0 $ (2,652,800) $ 2,848,900
Buildings and improvements 31,625,800 (12,144,200) (8,816,100) 10,665,500
-------------- ------------- ------------- ------------
37,127,500 (12,144,200) (11,468,900) 13,514,400
Accumulated depreciation and amortization (13,374,100) 5,624,100 3,004,700 (4,745,300)
-------------- ------------- ------------- ------------
Total investment properties, net of
accumulated depreciation and amortization 23,753,400 (6,520,100) (8,464,200) 8,769,100
Cash and cash equivalents 2,287,700 7,440,000 8,680,000 18,407,700
Investment in debt securities 1,975,400 1,975,400
Rents receivable 71,800 (27,900) (38,600) 5,300
Other assets 29,900 (3,000) (19,500) 7,400
-------------- ------------- ------------- ------------
$ 28,118,200 $ 889,000 $ 157,700 $ 29,164,900
============= ============= ============= ============
LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
Accounts payable and accrued expenses $ 324,100 $ (75,000) $ (43,400) $ 205,700
Due to Affiliates 18,700 18,700
Real estate commissions due to Affiliate 403,000 403,000
Security deposits 150,000 (83,300) (22,500) 44,200
Distributions payable 420,000 7,440,000 8,640,000 16,500,000
Other liabilities 87,300 87,300
-------------- ------------- ------------- ------------
1,403,100 7,281,700 8,574,100 17,258,900
-------------- ------------- ------------- ------------
Partners' capital:
General Partners (deficit) (471,100) 406,000 200,000 134,900
Limited Partners (60,000 Units
outstanding) 27,186,200 (6,798,700) 8,616,400 11,771,100
-------------- ------------- ------------- ------------
26,715,100 (6,392,700) 8,416,400 11,906,000
-------------- ------------- ------------- ------------
$ 28,118,200 $ 889,000 $ 157,700 $ 29,164,900
============= ============= ============= ============
</TABLE>
The accompanying notes are an integral part of the pro forma financial
statements.
Page 6
<PAGE>
FIRST CAPITAL INSITUTIONAL REAL ESTATE, LTD. - 1
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
---------------------------------------------------------
Pro Forma
Statement of Peachtree Lakewood Statement of
Income and Pro Forma Pro Forma Income and
Expenses Adjustments Adjustments Expenses
------------ ------------- ------------- ------------
<S> <C> <C> <C> <C>
Income:
Rental $ 1,232,100 $ (444,300) $ (366,600) $ 421,200
Interest 58,600 0 0 58,600
------------ ------------- ------------- ------------
1,290,700 (444,300) (366,600) 479,800
------------ ------------- ------------- ------------
Expenses:
Depreciation and amortization 292,600 (130,900) (71,600) 90,100
Property operating:
Affiliates 56,400 (12,800) (37,000) 6,600
Nonaffiliates 262,000 (135,200) (14,500) 112,300
Real estate taxes 105,100 (18,200) (28,800) 58,100
Insurance - Affiliate 11,100 (4,700) (1,200) 5,200
Repairs and maintenance 145,400 (60,700) (15,300) 69,400
General and administrative:
Affiliates 6,100 6,100
Nonaffiliates 43,200 43,200
------------ ------------- ------------- ------------
921,900 (362,500) (168,400) 391,000
------------ ------------- ------------- ------------
Net income $ 368,800 $ (81,800) $ (198,200) $ 88,800
============ ============= ============= ============
Net (loss) allocated to General Partners $ (22,700) $ 11,000 $ 4,500 $ (7,200)
============ ============= ============= ============
Net income allocated to Limited Partners $ 391,500 $ (92,800) $ (202,700) $ 96,000
============ ============= ============= ============
Net income allocated to Limited
Partners per Unit (60,000 Units
outstanding) $ 6.53 $ (1.55) $ (3.38) $ 1.60
============ ============= ============= ============
</TABLE>
The accompanying notes are an integral part of the pro forma financial
statements.
Page 7
<PAGE>
FIRST CAPITAL INSITUTIONAL REAL ESTATE, LTD. - 1
PRO FORMA STATEMENT OF INCOME AND EXPENSES
(All dollars rounded to nearest 00s
except per Unit amounts)
<TABLE>
<CAPTION>
Year Ended December 31, 1996
-----------------------------------------------------------
Pro Forma
Peachtree Lakewood Statement of
Statement of Pro Forma Pro Forma Income and
Income and Adjustments Adjustments Expenses
Expenses (Unaudited) (Unaudited) (Unaudited)
------------ ------------- -------------- -------------
<S> <C> <C> <C> <C>
Income:
Rental $ 4,866,600 $ (1,486,000) $ (1,297,700) $ 2,082,900
Interest 208,000 208,000
------------ ------------- -------------- -------------
5,074,600 (1,486,000) (1,297,700) 2,290,900
------------ ------------- -------------- -------------
Expenses:
Depreciation and amortization 1,144,000 (528,100) (269,100) 346,800
Property operating:
Affiliates 227,200 (65,000) (127,500) 34,700
Nonaffiliates 998,900 (450,400) (39,300) 509,200
Real estate taxes 377,500 (70,700) (103,200) 203,600
Insurance - Affiliate 60,400 (20,300) (18,200) 21,900
Repairs and maintenance 692,200 (278,800) (99,300) 314,100
General and administrative:
Affiliates 37,800 37,800
Nonaffiliates 146,800 146,800
------------ ------------- -------------- -------------
3,684,800 (1,413,300) (656,600) 1,614,900
------------ ------------- -------------- -------------
Net income $ 1,389,800 $ (72,700) $ (641,100) $ 676,000
============ ============= ============== =============
Net (loss) allocated to General Partners $ (89,100) $ 46,800 $ 17,800 $ (24,500)
============ ============= ============== =============
Net income allocated to Limited Partners $ 1,478,900 $ (119,500) $ (658,900) $ 700,500
============ ============= ============== =============
Net income allocated to Limited
Partners per Unit (60,000 Units
outstanding) $ 24.65 $ (1.99) $ (10.98) $ 11.68
============ ============= ============== =============
</TABLE>
The accompanying notes are an integral part of the pro forma financial
statements.
Page 8
<PAGE>
FIRST CAPITAL INSTITUTIONAL REAL ESTATE, LTD. - 1
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, security deposits and other liabilities have
been adjusted as of March 31, 1997 to reflect the sales of the Registrant's
interests in the Properties in 1997.
b) Cash and cash equivalents has been adjusted to include the net cash
received by the Registrant from the purchasers of the properties.
c) Distributions payable has been adjusted to reflect the approximate amount
of the special distributions of Sales Proceeds to Limited Partners as if
such special distributions 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 interests
in the operations of Properties sold during 1997.
Page 9
<PAGE>
PEACHTREE PALISADES EAST OFFICE BUILDING
ATLANTA, GEORGIA
REAL ESTATE SALE AGREEMENT
--------------------------
THIS REAL ESTATE SALE AGREEMENT (this "Agreement") is made as of the
___ day of February, 1997, by and between FIRST CAPITAL INSTITUTIONAL REAL
ESTATE, LTD., a Florida limited partnership ("Seller"), with an office at Two
North Riverside Plaza, Suite 2244, Chicago, Illinois 60606, and SONGY PARTNERS
LIMITED ("Purchaser"), a Florida limited partnership, with an office at 95 South
Federal Highway, Suite 200, Boca Raton, Florida 33432.
RECITALS
--------
A. Seller is the holder of the leasehold interest in a certain
parcel of real estate in the City of Atlanta, County of Fulton, State of
Georgia, which parcel is more particularly described in attached Exhibit "A"
-----------
(the "Real Property"), and Seller is the owner of an office building commonly
known as "Peachtree Palisades East" located thereon.
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
-----------------
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:
(i) The leasehold interest under that certain Lease
Agreement originally entered into by and between Atlanta National Real
Estate Holding Company, a Georgia corporation, as lessor, Peachtree
Palisades Corp., a Georgia corporation, as lessee, and Allan-Grayson
Realty Company, as agent, dated as of January 4, 1962, and recorded in
Deed Book 3827, Page 111, Fulton County Records, as modified, amended
and assigned pursuant to the instruments recorded as follows: Book
3958 Page 452; Book 3959 Page 61; Book 3968 Page 544; Book 4861 Page
215; Book 4855 Page 327; Book 4855 Page 332; Book 4855 Page 324; Book
4344 Page 146; Book 4480 Page 49; Book 5100 Page 549; Book 5369 Page
350; Book 5529 Page 103; Book 5996 Page 432; and Book 5996 Page 421,
together with the Ground Lessee's option to purchase the Real Property
and Improvements pursuant to paragraph 17 of the Ground Lease
(collectively, the "Ground Lease");
(ii) all buildings and improvements located on the Real
Property owned by Seller (collectively, the "Improvements");
(iii) Seller's right, title and interest in and to (a) all
leases of the Real Estate and the Improvements, including, but not
limited to, the leases reflected on
1
<PAGE>
Schedule 1 hereto and any leases hereafter entered into pursuant to
----------
Section 9(E) hereof (the "Leases") affecting the Property or any part
------------
thereof, and (b) that certain Lease dated May 9, 1994 between Seller,
as landlord, and Peachtree Palisades Partnership, as tenant, and that
certain other Lease dated May 9, 1994 between Peachtree Palisades
Partnership, as landlord, and Seller, as tenant (collectively, the
Parking Space Agreements");
(iv) all furniture, furnishings, fixtures, equipment,
maintenance vehicles, tools, books, records, reports, plans, drawings,
specifications and other tangible personalty owned by Seller, located
on the Property and used in connection therewith including without
limitation the items listed on Schedule 2 hereto, but excluding all
----------
computers, modems and printers (collectively, the "Tangible Personal
Property");
(v) all right, title and interest of Seller under any and
all of the maintenance, service, advertising and other like contracts
and agreements listed on Schedule 3 hereto with respect to the
----------
ownership and operation of the Property (the "Service Contracts");
(vi) any and all rights of Seller to use the name
"Peachtree Palisades East;"
(vii) all easements, hereditaments, and appurtenances
belonging to or inuring to the benefit of the Real Property;
(viii) all assignable warranties and guaranties, with
respect to the Property and the Improvements; and
(ix) all of Seller's assignable right, title and interest,
if any, in and to any permits, governmental approvals, orders,
licenses, development rights or other governmental or private
authorizations with respect to the Property ("Approvals");
all to the extent applicable to the period from and after the Closing
(as such term is hereinafter defined). Items (i) through (ix) above
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
--------------
The purchase price to be paid by Purchaser to Seller for the Property
is Eight Million One Hundred Fifty Thousand Dollars ($7,885,000.00) (the
"Purchase Price"). The Purchase Price shall be paid as follows:
2
<PAGE>
A. Earnest Money.
-------------
(i) Within three (3) days following the execution of this Agreement
by Purchaser and Seller, Purchaser shall deliver to the Chicago, Illinois,
office of the Title Insurer ("Escrowee") initial earnest money (the "Initial
Earnest Money") in the sum of One Hundred Thousand Dollars ($100,000.00). The
Initial Earnest Money, together with any interest earned thereon are referred to
in this Agreement as the "Earnest Money". The Earnest Money shall be invested as
Seller and Purchaser so direct. Any and all interest earned on the Earnest Money
shall be reported to Purchaser's federal tax identification number.
(ii) 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
delivered by Escrowee to Seller as agreed and liquidated damages and in full
settlement of all claims Seller may have against Purchaser, except as more
particularly provided in Section 6, and the indemnification rights and
---------
obligations under Section 10(G) below. If the transaction fails to close due to
-------------
a default on the part of Seller, Purchaser shall have the remedy provided for in
Section 7(A) below.
- ------------
B. Cash 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.
------------
3
<PAGE>
3. EVIDENCE OF TITLE
-----------------
A. Title Commitment. Seller shall, within twenty (20) days
----------------
after the date of this Agreement, obtain and cause to be delivered to Purchaser
a current (that is, effective after the date of this Agreement) commitment for
an ALTA Leasehold Owner's Title Insurance Policy (the "Title Commitment"), in
the amount of the Purchase Price, underwritten by Commonwealth Land Title
Insurance Company (the "Title Insurer") within one day following the date of
this Agreement. The Title Commitment shall also insure Purchaser's fee title to
the Improvements. All standard printed exceptions shall be deleted except for
(i) the lien for taxes which are not yet due and payable, and (ii) the exception
for parties in possession which shall be limited to the rights of the tenants
shown on Schedule 1 (and any tenants under any New Lease) as tenants only. The
----------
Title Commitment shall additionally commit to insure Purchaser's interest, as
lessee, in the purchase option established pursuant to Section 17 of the Ground
Lease. At Closing, the conveyance of the Property to Purchaser shall be made
subject only to those exceptions to title which are more fully described on
attached Exhibit B and exceptions to title which become Permitted Exceptions
---------
pursuant to this Section 3 (collectively, the "Permitted Exceptions").
---------
B. Survey. Seller shall, within twenty (20) days after the
------
date of this Agreement, deliver to Purchaser a survey (the "Survey") of the Real
Property and Improvements prepared by a surveyor licensed in the State of
Georgia in accordance with the Minimum Standard Requirements for Land Title
Surveys (as jointly established and adopted in 1992 by the American Land Title
Association and American Congress on Surveying and Mapping) for an "Urban
ALTA/ACSM Land Title Survey" (as defined therein), and certified as being
prepared after the date hereof. The Survey shall be certified to the Title
Company, the Purchaser, and the Purchaser's lender, if any and shall contain a
form of certification as Purchaser shall reasonably require, and shall reflect
that (i) all of the Improvements (including the office building commonly known
as Peachtree Palisades East) is completely located on the Real Property, and
(ii) all easements and other matters of survey reflected as exceptions on the
Title Commitment.
C. Review of Title Commitment and Survey. If the Title
-------------------------------------
Commitment or Survey disclose exceptions to title other than those Permitted
Exceptions which are noted on attached Exhibit B, or if the Title Commitment
---------
fails to contain any of the coverages set foth in Section 3(A) above, then
------------
Purchaser shall have until 5:00 p.m. (Chicago, Illinois time) on the tenth
(10th) day after its receipt of the last of the Title Commitment and the Survey
within which to notify Seller of any such exceptions to title or lack of
coverage to which Purchaser objects. If any additional exceptions to title
arise between the date of the Title Commitment, the Survey and the Closing,
Purchaser shall have five (5) days after its receipt of notice of same within
which to notify Seller of any such exceptions to title to which Purchaser
objects. Any such exceptions to title not objected to by Purchaser as aforesaid
shall become Permitted Exceptions. If Purchaser objects to any such exceptions
to title or lack of coverage, Seller shall have until Closing (but in any event
at least fifteen [15] days after it receives notice of Purchaser's objection(s))
to cause the Title Insurer to issue such coverage, or to remove such exceptions
to title by waiver or endorsement by the Title Insurer, as the case may be,
provided, however, that (i) any such endorsements issued by the Title Insurer
shall be reasonably acceptable to Purchaser, and (ii) the Title Insurer shall
affirmatively commit to Purchaser to insure subsequent owner's of the Property
without additional cost to Purchaser. If Seller fails to remove any such
exceptions to title as aforesaid, Purchaser may, as its sole and exclusive
4
<PAGE>
remedy, terminate this Agreement and obtain a return of the Earnest Money. If
Purchaser does not elect to terminate this Agreement, Purchaser shall consummate
the Closing and accept title to the Property subject to all such exceptions to
title (in which event, all such exceptions to title shall be deemed "Permitted
Exceptions") but otherwise in the form set forth in the Title Commitment.
4. CLOSING
-------
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 10:00 a.m. on the thirtieth (30th) day following
the date hereof, at the Atlanta, Georgia 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. Notwithstanding the foregoing, Purchaser shall
have a one-time right to extend the Closing Date for a period of up to thirty
(30) days (the "Extension Period") upon (i) delivery to Seller of written notice
of such election to Seller on or before the twentieth (20th) day following the
date hereof, and (ii) simultaneously delivering to the Chicago, Illinois, office
of the Escrowee additional Earnest Money in the sum of Fifty Thousand Dollars
($50,000.00).
B. Closing Documents.
-----------------
(i) Seller. At Closing, Seller shall execute and deliver to
------
Purchaser the following:
(a) a Limited Warranty Deed, conveying title to the
Improvements, subject only to the Permitted Exceptions, and in form
acceptable to the Title Insurer;
(b) a limited warranty bill of sale sufficient to transfer
to Purchaser title to the Tangible Personal Property and expressly
disclaiming any warranties other than as to any claims arising by,
through or under Seller;
(c) a letter advising tenants under the Leases and
contractors under Service Contracts of the change in ownership of the
Property in the forms attached hereto as Exhibit "G-1" and Exhibit "G-
------------- ----------
2";
--
(d) a counterpart of the Assignment and Assumption of Ground
Lease, in form reasonably acceptable to Seller, Purchaser and the
Title Insurer pursuant to which (i) Seller transfers and assigns all
of its right, title and interest as lessee in, to and under the Ground
Lease to Purchaser, including, but not limited to, the ground lessee's
option to purchase the Real Property and Improvements pursuant to
paragraph 17 of the Ground Lease, and (ii) Purchaser assumes all of
the rights and obligations of lessee under the Ground Lease arising
from and after the Closing Date;
(e) a counterpart of the Assignment and Assumption of
Leases, Parking Space Agreements and Service Contracts, in form
reasonably acceptable
5
<PAGE>
to Seller and Purchaser, pursuant to which Purchaser assumes all
obligations thereunder arising subsequent to the Closing Date;
(f) 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;
(g) a counterpart of the closing statement ("Closing
Statement") setting forth the prorations and adjustments to the
Purchase Price as required by Section 4(C) below;
------------
(h) an Assignment, in form reasonably acceptable to Seller
and Purchaser, as to the items of Property set forth in subparagraphs
1 (vi), (vii), (viii) and (ix) hereof;
(i) a mechanic's lien and possession affidavit in form
approved by the Title Company sufficient to allow deletion of the
standard printed title insurance exceptions for rights of parties in
possession (but the rights of tenants shown on Schedule 1 as tenants
only may be reflected as an exception) and potential mechanic's liens
arising from work performed by or for Seller.
(ii) Purchaser. Purchaser shall execute and deliver or cause to
---------
be delivered to Seller at Closing:
(a) the funds required pursuant to Section 2(B) above;
------------
(b) a counterpart of the Assignment and Assumption of Ground
Lease; and
(c) a counterpart of the Assignment and Assumption of
Leases, Parking Space Agreements and Service Contracts, in form
reasonably acceptable to Seller and Purchaser;
(d) a counterpart of the Closing Statement.
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 (on the basis of
the most recent ascertainable tax bill if the current bill is not then
available); any liens for assessments which are due and payable on or
before the Closing Date shall be paid by Seller and any assessments
which become due after Closing shall be assumed by Purchaser;
6
<PAGE>
(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 six (6) months thereafter. Purchaser shall promptly deliver to
Seller a copy of each such bill submitted to tenants. Purchaser shall
promptly remit to Seller any such rent or other sums paid by scheduled
tenants, but only if a deficiency in the then current rent is not
thereby created. To the extent not set forth on said schedule,
percentage or overage rent and reimbursement of real estate taxes
payable, common area maintenance, utility charges, water and sewer
charges, insurance 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 (i) the
Lease with Mudd Media, and (ii) any Leases, or any modification,
amendment, restatement or renewal thereto, executed after the date
hereof (items (i) and (ii) above being collectively 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 the term of the New Lease through the Closing
Date to the total term of the New Lease, excluding any unexercised
option periods. Additionally, Purchaser shall have no obligation to
pay any "inside" commissions to Seller or its affiliated entities).
(d) the amount of security deposits paid under the Leases
shall be credited to Purchaser at Closing. Additionally, at Closing,
Seller's interest in that certain letter of credit No. 84007905,
issued by The Central and Southern Bank on behalf of Roy Ashley and
Associates, Inc., shall be assigned to Purchaser, provided that
Purchaser acknowledges that such letter of credit expires on March 18,
1997. Subsequent to the date hereof Seller shall not apply any
security deposits toward any delinquent rental or other tenant
default;
(e) water, electric, telephone and all other utility and
fuel charges, fuel on hand (at cost plus sales tax), and any deposits
with utility
7
<PAGE>
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;
(h) Purchaser shall pay Seller at Closing the sum of
$137,000.00 for tenant improvements and commissions for each of the
two Railcar tenant lease transactions (the "Railcar Reimbursement"),
provided that the Railcar Reimbursement shall be reduced by an amount
equal to the product of (a) the number of days from December 1, 1996
to the Closing, and (b) $73.65;
(i) Purchaser shall receive at Closing, a credit equal to
the then-present value of the $750,000 purchase price due to the
ground lessor ("Ground Lessor") under the Ground Lease on December 31,
2021 pursuant to the Option to Purchase set forth in Section 17 of the
Ground Lease. The present value of such amount shall be calculated
using a discount rate equal to the rate at the time of Closing of
long-term U.S. Treasury obligations of comparable maturity; and
(j) other items of income and expenses of operation.
(ii) Notwithstanding the foregoing, Seller shall in all
events be entitled to retain amounts paid by tenants (referred to
herein as "Tenant Reimbursements") for real estate taxes and
assessments, and common area and operating expenses (collectively,
"Tenant Reimbursable Expenses") as of the Closing to the extent not in
excess of the actual amount of such Tenant Reimbursable Expenses paid
by Seller for the period prior to the Closing Date, and following the
Closing and upon Purchaser's completion of the reconciliation of such
amounts with tenants for 1997 (which seller and Purchaser agree shall
be completed on or before May 31, 1998), then:
(x) in the event that the amount of Tenant Reimbursements
collected by Seller for 1997 is less than the amount of Tenant
Reimbursable Expenses paid by Seller with respect to 1997 and for
which Seller is entitled to recover under the terms of the
Leases, Purchaser shall (1) to the extent such amounts have
already been collected by Purchaser from the tenants, promptly
remit such amounts to Seller but only if the applicable tenant is
otherwise current in the payment of all obligations due for the
period following Closing, and (2) to the extent such amounts have
not yet been collected from tenants, Purchaser shall promptly
bill the tenants for such amounts and continue to bill such
tenants for such amounts each month for six (6) months
thereafter, and, promptly upon receipt thereof, pay such amounts
to Seller;
(y) in the event that the amount of Tenant Reimbursements
collected by Seller for 1997 exceeds the amount of Tenant
8
<PAGE>
Reimbursable Expenses paid by Seller with respect to 1997 and for
which Seller is entitled to recover under the terms of the
Leases, Seller shall remit such excess amounts to Purchaser,
provided, that Purchaser shall be thereafter obligated to
promptly remit the applicable portion to the particular tenants
entitled thereto; and
(z) Seller and Purchaser agree to cooperate in (1)
obtaining the final calculations of Tenant Reimbursements
collected by Seller and Purchaser for 1997 and Tenant
Reimbursable Expenses paid by Seller and Purchaser with respect
to 1997, and (2) Purchaser's billing tenants for any amounts due
as a result of such calculations.
(iii) Seller shall be responsible for the reconciliation with
tenants of Tenant Reimbursements and Tenant Reimbursable Expenses for
the calendar year 1996, and (x) in the event the amount of Tenant
Reimbursements collected by Seller for 1996 is less than the amount of
Tenant Reimbursable Expenses paid by Seller with respect to 1996 and
for which Seller is entitled to recover under the terms of the Leases,
then Seller shall be entitled to bill such tenants and retain any such
amounts due from tenants, and (y) in the event that the amount of
Tenant Reimbursements collected by Seller for 1996 exceeds the amount
of Tenant Reimbursable Expenses paid by Seller with respect to 1996
and for which Seller is entitled to recover under the terms of the
Leases, then, to the extent required under the terms of the Leases,
Seller shall remit such excess amounts to the applicable tenants.
(iv) Seller shall retain all rights with respect to any
refund of taxes applicable to any period prior to the Closing Date.
(v) 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.
D. Transaction Costs.
-----------------
Seller and Purchaser shall each pay for one-half (1/2) of the cost of
the Survey, all transfer taxes, documentary stamps escrow fees, deed recording
charges, and the premiums for the owner's title insurance policy, whether or not
the Closing occurs. Purchaser shall pay for the entire cost of any lender's
title insurance policy and for any endorsements to the owner's title insurance
policy, 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.
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. If (i) the reasonably estimated cost to repair or
restore the Property as a result of such condemnation or
9
<PAGE>
casualty exceeds Two Hundred Thousand Dollars ($200,000), or (ii) any
condemnation or proposed condemnation would result in a loss of parking or a
material interference with, or impairment of, Purchaser's use, ownership,
operation of, or access to, the Property (each of items (i) or (ii) above being
referred to as a "Material Loss"), Purchaser shall have the option to terminate
this Agreement by giving notice to Seller within fifteen (15) days of Seller's
request that the option be exercised. If the condemnation, destruction or damage
does not result in a Material Loss, or if Purchaser fails to terminate this
Agreement following a Material Loss as provided herein, then Seller and
Purchaser shall consummate the transaction contemplated by this Agreement
notwithstanding such condemnation, destruction or damage. If the transaction
contemplated by this Agreement is consummated, Purchaser shall be entitled to
receive the condemnation proceeds or settle the loss under all policies of
insurance applicable to the destruction or damage and receive the proceeds of
insurance applicable thereto, and Seller shall, at Closing, allow Purchaser a
credit against the Purchase Price in an amount equal to any applicable
deductibles and shall also execute and deliver to Purchaser all customary proofs
of loss, assignments of claims and other similar items. If Purchaser elects to
terminate this Agreement, 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 except as otherwise provided for in Section
-------
9(C) below.
- ----
6. BROKERAGE
---------
Seller agrees to pay upon Closing (but not otherwise) a brokerage
commission due to Grubb & Ellis Company and Cushman Realty, Inc. for services
rendered in connection with the sale and purchase of the Property. Seller shall
indemnify and hold Purchaser harmless from and against any and all claims of all
other brokers and finders claiming by, through or under Seller 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
Purchaser in connection with such claim. Purchaser shall indemnify and hold
Seller harmless from and against any and all claims of all other brokers and
finders claiming by, through or underPurchaser 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 Seller 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 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 more than fifteen (15) days after the scheduled Closing
Date, and provided an action is filed within thirty (30) days thereafter,
Purchaser may seek specific 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.
B. If Purchaser fails to perform in accordance with the terms
of this Agreement, the Earnest Money shall be retained by Seller as liquidated
damages and as Seller's sole and exclusive remedy, other than those rights that
survive as provided in Section 9(C) below.
------------
10
<PAGE>
C. 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. CONDITION PRECEDENT
-------------------
A. [INTENTIONALLY DELETED]
B. Estoppel Certificates. As a condition to Purchaser's
---------------------
obligation to close hereunder, Purchaser shall have received estoppel
certificates ("Estoppel Certificates"), dated no more than forty-five (45) days
prior to Closing (provided that the Estoppel certificates may be dated no more
than seventy-five (75) days prior to Closing in the event Purchaser exercises
the Extension Period), from tenants occupying not less than eighty percent (80%)
of the remaining space leased as of the date of Closing and in the form and
content as set forth herein (the aforesaid acceptable Estoppel Certificates to
be delivered are collectively referred to as the "Required Estoppel
Certificates"). The Required Estoppel Statements shall include estoppel
statements from all of the following Tenants: Railcar Management and Jacor
Communications. The Estoppel Certificates shall be in the form of Exhibit "E-1"
-------------
attached hereto (the "Form Tenant Estoppel Certificate"). The Estoppel
Certificates executed by tenants shall be in substantially the form of the Form
Tenant Estoppel Certificate, except that (i) an Estoppel Certificate executed by
a tenant shall be deemed an acceptable Estoppel Certificate for purposes of this
Section 8(B) as long as it contains the information set forth in items 1 through
- ------------
7 on the Form Tenant Estoppel Certificate and such information is consistent
with Schedule 4 hereto, and (ii) an Estoppel Certificate shall be deemed an
----------
acceptable Estoppel Certificate for purposes of this Section 8(B) if it contains
------------
the qualification by the tenant of any statement as being to the best of its
knowledge or as being subject to any similar qualification.
It shall also be a condition precedent to Purchaser's obligation to
close that Purchaser receive prior to Closing an estoppel statement from the
Ground Lessor in the form of Exhibit "E-2" hereto ("Ground Lessor Estoppel").
-------------
Seller shall promptly provide Purchaser with a copy of each Estoppel
Certificate or Ground Lessor Estoppel as the same are received by Seller, but in
any event at least five (5) days prior to Closing. In the event that Seller is
unable to provide to Purchaser all of the Required Estoppel Certificates or the
Ground Lessor Estoppel on or before Closing, Purchaser may either (i) elect not
to purchase the Property, in which event the Earnest Money shall be returned to
Purchaser, at which time this Agreement shall be null and void and neither party
shall have any further rights or obligations under this Agreement, except for
the indemnity obligations set forth in Sections 6 and 10(G) hereof which shall
---------- -----
survive termination, (ii) elect a one-time right to extend the Closing for ten
(10) days, or (iii) elect to purchase the Property notwithstanding Seller's
inability to provide the Required Estoppel Certificates or the Ground Lease
Estoppel, in which event Purchaser shall be deemed to have waived the condition
contained in this Section 8(B).
------------
C. Accuracy of Seller's Representations and Warranties. As a
---------------------------------------------------
condition to the obligations of Purchaser to close hereunder, each of Seller's
representations and warranties set forth in Section 9 below shall be true and
---------
correct as of the Closing, as modified by any "Pre-Closing Disclosures" (as
defined in Section 9(B) below). Notwithstanding the foregoing, if Seller makes
------------
any Pre-Closing Disclosure to Purchaser, Purchaser shall have the right to
terminate
11
<PAGE>
this Agreement and receive the return of the Earnest Money by delivering written
notice thereof to Seller on or before the earlier of (i) the Closing, or (ii)
the fifth (5th) business day after Purchaser receives written notice of such
Pre-Closing Disclosure. If Purchaser does not terminate this Agreement pursuant
to its rights under this Section 8(C), then such representations and warranties
------------
shall be deemed modified to conform them to the Pre-Closing Disclosure.
D. Right of First Refusal in Favor of Ground Lessor. As a
------------------------------------------------
condition to the obligations of Purchaser to close hereunder, Seller shall have
received prior to Closing satisfactory evidence of the Ground Lessor's waiver of
its right of first refusal with respect to any sale of the Property in favor of
Ground Lessor pursuant to the terms and provisions of the Ground Lease (the
"Waiver"), which shall be deemed to have been delivered upon receipt by Seller
of the Ground Lessor Estoppel in the form of Exhibit "E-2" attached hereto. If
-------------
Seller does not so receive the Waiver, Seller shall notify Purchaser in writing
and, thereupon, the Earnest Money shall be returned to Purchaser, and at which
time this Agreement shall be null and void and neither party shall have any
further rights or obligations under this Agreement, except for the indemnity
obligations set forth in Sections 6 and 10(G) hereof which shall survive
---------- -----
termination. Seller shall use diligent and good faith efforts to obtain the
Waiver.
9. SELLER'S REPRESENTATIONS, WARRANTIES AND COVENANTS
--------------------------------------------------
A. Subject to Section 9(C) below, Seller represents and warrants to
------------
Purchaser that, as of the date of this Agreement:
(i) Organization; Authority. Seller is a limited partnership
-----------------------
duly organized and in good standing under the laws of the State of
Florida. Seller has the power and authority under (i) Seller's
agreement of limited partnership, and (ii) the articles of
incorporation and bylaws of Seller's general partner (the instruments
described in (i) and (ii) above being referred to as "Seller's
Organizational Documents"), to sell, transfer, convey and deliver the
Property to be sold and purchased hereunder, and all action and
approvals required thereunder have been duly taken and obtained.
(ii) No Breach. The execution and delivery of this Agreement,
---------
the consummation of the transactions provided for herein and the
fulfillment of the terms hereof will not result in a breach of any of
the terms or provisions of, or constitute a default under, any
provision of Seller's Organizational Documents.
(iii) Condemnation. Seller has not received from any
------------
governmental authority any written notice of any condemnation of the
Property or any part thereof.
(iv) Litigation. Except as set forth on Exhibit H attached
---------- ---------
hereto, Seller has not been served with any material litigation which
is still pending with respect to its ownership or operation of the
Property.
B. As of Closing, Seller shall be deemed to remake and restate
the representations set forth in Sections 9(A)(i) through (iv) except that the
---------------- ----
representations shall be updated by delivering written notice to Purchaser in
order to reflect any fact, matter or circumstance which Seller's Chicago,
Illinois representatives become aware of that would make
12
<PAGE>
any of Seller's representations or warranties contained herein untrue or
incorrect (any such disclosure being referred to as a "Pre-Closing Disclosure").
Notwithstanding the foregoing, the obligation to update the representations and
warranties as provided herein shall not relieve Seller from liability (if any)
under any other provision of this Agreement.
C. The representations and warranties set forth in Section 9(A),
------------
subject to modifications thereto as a result of any Pre-Closing Disclosure, and
the covenants of Seller set forth in Section 9(D) below, shall survive the
------------
Closing, but only for a period of six (6) months thereafter, and not otherwise.
Purchaser shall however be entitled to pursue any available remedies as to any
specific claims for breach which are made by Purchaser in writing within the
aforesaid six (6) month period. Except as provided for in Sections 4(C)(iv), 6,
---------------------
10(G), and this Section 9(C), the obligations of the parties under
- ----- ------------
this Agreement shall not survive the Closing or any termination of this
Agreement.
D. Between the date of this Agreement and Closing, Seller shall:
(i) not remove any item of Tangible Personal Property except
as may be required for repair or replacement or to retire obsolete
property;
(ii) keep all existing insurance for the Property (or
coverage substantially equivalent thereto) in full force and effect;
and
(iii) not enter into any amendment or modification of the
Ground Lease without the consent of Purchaser;
(iv) otherwise continue to operate and maintain the Property
consistent with prior practices as heretofore existing, but in no
event shall Seller be obligated to make any capital expenditures.
E. Seller hereby covenants and agrees with Purchaser that:
(i) From and after January 9, 1997, through the date hereof,
Seller may enter into any New Lease (as defined above) 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 any such New Lease is in the
ordinary course of business at rates and terms that Seller believes to
be market rates and terms and Seller has delivered a copy of any New
Agreements to Purchaser prior to the date hereof.
(ii) Following the date hereof, 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 ten (10) days after Purchaser's receipt of
Seller's request, Purchaser shall be conclusively deemed to have
approved of such New Agreement.
10. 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
13
<PAGE>
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. Neither this Agreement nor any interest hereunder shall be
assigned or transferred by Purchaser, except that, following written notice to
Seller, Purchaser may assign its interest in this Agreement, without Seller's
consent, to an entity which is owned and controlled by Purchaser or in which
David B. Songy or an entity controlled by him is a partner. Seller may assign
or otherwise transfer its interest under this Agreement. As used in this
Agreement, the term "Seller" and "Purchaser" shall be deemed to include any
permitted assignee or other transferee of any Seller or Purchaser, as the case
may be. Upon any such transfer by a Seller or Purchaser, such original Seller
or Purchaser, as the case may be, shall remain liable for the obligations of
Seller or Purchaser, as the case may be, 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 Georgia.
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:
1. If to Seller:
c/o Equity Office Holdings, L.L.C.
Two North Riverside Plaza
Suite 2200
Chicago, Illinois 60606
Attention: Alissa Schneider
With a copy to:
Rosenberg & Liebentritt, P.C.
Suite 1515
Two North Riverside Plaza
Chicago, Illinois 60606
Attention: Ira Chaplik
14
<PAGE>
2. If to Purchaser:
Songy Partners Limited
95 South Federal Highway
Suite 200
Boca Raton, Florida 33432
Attention: David B. Songy
With a copy to:
Tew & Beasley
201 South Biscayne Boulevard
Suite 2600
Miami, Florida 33131
Attention: Brian Tague, Esq.
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 10(F).
-------------
G. From the date hereof through the Closing, Purchaser shall be
entitled to review copies of (i) the Leases, (ii) the most recent real estate
tax statements with respect to the Property, (iii) the most recent sewer and
water bills with respect to the Property, (iv) the Service Contracts, (v) bills
for electricity and for fuel used to operate the heating and air conditioning
systems controlled by Seller at the Property covering the previous twelve (12)
months, (vi) correspondence between tenants and Seller (as landlord), (except
for any of such items that contain privileged information), (vii) billings to
tenants for Tenant Reimbursables and invoices for Tenant Reimbursable Expenses,
(viii) any plans for the buildings located on the Property, and (ix) any
licenses or permits issued to Seller in connection with the ownership and
operation of the Property, all to the extent in Seller's possession and to the
extent the same are located at the Property. Purchaser's right of inspection
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
(i.e., not less than 24 hours) prior notification to Seller. Seller shall, at
its option, be permitted to have a representative present at any or all
inspections. Neither Purchaser nor its agents or representatives shall contact
any tenants without forty-eight (48) hours prior notification to Seller, and
Seller shall, at its option, be permitted to have a representative present at
any or all discussions with tenants. No inspection shall involve the taking of
samples or other physically invasive procedures without the prior consent of
Seller. PURCHASER AGREES THAT PURCHASER SHALL NOT BE PERMITTED TO CONTACT THE
GROUND LESSOR WITHOUT FORTY-EIGHT (48) HOURS PRIOR NOTIFICATION TO SELLER AND
SELLER SHALL, AT ITS OPTION, BE PERMITTED TO HAVE A REPRESENTATIVE PRESENT
DURING ALL CONTACTS BETWEEN PURCHASER AND THE GROUND LESSOR. 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, attorneys' fees incurred in connection therewith) arising
out of or resulting from Purchaser's exercise of its rights of inspection as
provided for herein.
15
<PAGE>
H. 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 MAY BE SPECIFICALLY PROVIDED 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 (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.
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; OR (C) ANY ENVIRONMENTAL
CONDITIONS WHATSOEVER ON, UNDER, OR IN THE VICINITY OF THE PROPERTY.
I. In any lawsuit or other proceeding initiated by either party
under or with respect to this Agreement, either party waives any right it may
have to trial by jury. In addition, Purchaser and Seller waives any right to
seek rescission of the transaction provided for in this Agreement.
J. Except as may be required by law and except for disclosures made
to Purchaser's partners, lenders, consultants and attorneys in connection with
the transaction contemplated hereby, 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.
K. If for any reason Purchaser does not consummate the Closing, then
Purchaser shall, upon Seller's request, assign and transfer to Seller (but
without recourse,
16
<PAGE>
warranty or representation), 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 third parties at the
request of Purchaser, and shall deliver to Seller copies of all of the
foregoing.
L. 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.
17
<PAGE>
IN WITNESS WHEREOF, Seller and Purchaser have executed and delivered this
Agreement as of the date first above written.
SELLER: PURCHASER:
- ------- ----------
FIRST CAPITAL INSTITUTIONAL REAL _____________________________________
ESTATE, LTD., a Florida limited
partnership
By: First Capital Financial
Corporation, a Florida corporation, By: _________________________________
its sole general partner Its: ________________________________
By: ___________________________
Its: ___________________________
EXHIBITS:
---------
A - Legal Description
B - Permitted Exceptions
C - Intentionally Deleted
D - Intentionally Deleted
E - 1 Form of Tenant Estoppel Certificates
E - 2 Form of Ground Lessor Estoppel Certificates
F - Litigation
G - 1 Notice of Change in Ownership Sent to Tenants
G - 2 Notice of Change in Ownership Sent to Parties
under Service Contract
SCHEDULES:
----------
1 Tenants
2 Tangible Personal Property
3 Service Contracts
4 Tenant Rent Roll Information
18
<PAGE>
EXHIBIT "A"
-----------
LEGAL DESCRIPTION
-----------------
ALL THAT TRACT OR PARCEL OF LAND lying and being in Land Lots 109 and 110
of the 17th District of Fulton County, Georgia, and being more particularly
described as follows:
BEGIN at a concrete marker located at the point of intersection of the
northeasterly right-of-way line of Peachtree Road (80-foot right-of-way) with
the southwesterly right-of-way line of Palisades Road (80-foot right-of-way),
which right-of-way lines form an interior angle of 75 degrees, 25 minutes and
which point of intersection is THE POINT OF BEGINNING; run thence in a
southeasterly direction along the easterly right-of-way line of Peachtree Road a
distance of 190 feet to a point marked by an "X" in the concrete sidewalk
located on said right-of-way line; thence, turning to the left, and forming an
interior angle of 104 degrees, 35 minutes, run in an easterly direction a
distance of 300 feet to an iron pin set; thence, turning to the left, and
forming an interior angle of 75 degrees, 25 minutes, run in a northwesterly
direction a distance of 190 feet to an iron pin located on the southerly right-
of-way line of Palisades Road; thence, turning to the left, and forming an
interior angle of 104 degrees, 35 minutes, run in a westerly direction along the
southerly right-of-way line of Palisades Road a distance of 300 feet to a point
marked by an "X" in the concrete sidewalk located at the point of intersection
of the southwesterly right-of-way line of Palisades Road with the northeasterly
right-of-way line of Peachtree Road and THE POINT OF BEGINNING, according to
that certain plat of survey of the Palisades East Building, prepared by August
S. Giometti, Georgia Registered Land Surveyor No. 1125, and dated August 5,
1983.
19
<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. Those matters which are set forth in the Title Commitment and Survey which
are (i) not objected to by Purchaser, or (ii) waived by Purchaser pursuant
to the provisions of Section 3(C) of the Agreement.
------------
6. The Ground Lease
20
<PAGE>
EXHIBIT E - 1
FORM TENANT ESTOPPEL CERTIFICATE
--------------------------------
___________________________________
c/o Equity Office Properties, L.L.C.
Two North Riverside Plaza
Suite 2244
Chicago, Illinois 60606
Attn: Alissa Schneider
___________________________
___________________________
___________________________
___________________________
Ladies and Gentlemen:
At the request of _______________________________, a __________________
("Landlord"), made in connection with the proposed sale of the
__________________ Office Building, ________________________________ (the
"Property") and Landlord's interest in the "Lease" (as hereinafter defined) to
_______________________________ ("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 suite(s) _______ on the ________
floor(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.
3. The monthly [base][minimum] rent of $________ due under the Lease has
been paid through _______, 1996 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 ______________, 1996.
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 $ _______________.
7. There is no prepaid rent, except $ _____________.
21
<PAGE>
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 as of the date hereof
with respect to the Lease and in connection with the Premises has been completed
by Landlord to the satisfaction of Tenant.
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.
14. This Tenant Estoppel Certificate (this "Certificate") may be relied
upon and shall inure to the benefit of Landlord, Purchaser, any party providing
financing to Purchaser, and their respective 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.
Very truly yours,
______________________, Tenant
By:_____________________________________
___________________, Title
Date: ____________________, 1996
22
<PAGE>
EXHIBIT E-2
FORM GROUND LESSOR ESTOPPEL CERTIFICATE
---------------------------------------
First Capital Institutional Real Estate, Ltd.
c/o Equity Office Properties, L.L.C.
Two North Riverside Plaza
Suite 2200
Chicago, Illinois 60606
Attention: Alissa Schneider
_______________________________
c/o Songy Partners Limited
95 South Federal Highway
Suite 200
Boca Raton, Florida 33432
Ladies and Gentlemen:
At the request of First Capital Institutional Real Estate, Ltd., a Florida
limited partnership ("Ground Lessee"), made in connection with the proposed sale
of the Peachtree Palisades East Office Building and the assignment of Ground
Lessee's interest in the "Ground Lease" (as hereinafter defined) to Songy
Partners Limited ("Purchaser"), the undersigned Ground Lessor hereby certifies
to Ground Lessee and Purchaser as follows:
1. The undersigned is the Ground Lessor under a ground lease with Ground
Lessee. All of the instruments establishing the Ground Lease are as follows:
[Here will be inserted the complete list of instruments.]
The Ground Lease pertains to the land legally described in Exhibit "A"
-----------
attached hereto and all improvements located thereon (collectively the
"Premises").
True copies of all such instruments comprising the ground lease are
attached hereto as Exhibit "B" (the "Ground Lease").
-----------
2. The Ground Lease sets forth the entire agreement between the Ground
Lessor and the Ground Lessee with respect to the Premises, is in full force and
effect and has not been amended, modified or extended except as set forth in
Exhibit "B". There are no side letters or other agreements (whether written or
- -----------
oral) in affect which are binding upon Ground Lessor or Ground Lessee, other
than the Landlord - Tenant Agreement a true and complete copy of which is
attached hereto as Exhibit "C".
-----------
3. All rental payments required under the Ground Lease have been paid for
the entire term of the Ground Lease, except for the payment due to Ground Lessor
in the event of the Ground Lessee's exercise of the option to purchase the
Premises set forth in paragraph 17 of the Ground Lease.
4. Neither the Ground Lessor not the Ground Lessee is in default under
the Ground Lease.
23
<PAGE>
5. The expiration date of the Ground Lease is _________________, 19__.
6. The Ground Lessor has not assigned, collaterally assigned, or
mortgaged its interest under the Ground Lease.
7. Ground Lessor is the owner and holder of the entire ground lessor's
interest in the Ground Lease. Ground Lessor owns fee simple title to the land
described on Exhibit "A" hereto. There are no mortgages, liens, encumbrances or
-----------
options or rights of first refusal in effect which affect Ground Lessor's
interest in and to the Premises, except for Ground Lessee's right to exercise
the option to purchase as set forth in paragraph 17 of the Ground Lease.
8. The Ground Lessor has no defenses or counterclaims which might
adversely affect the rights of the Ground Lessee thereunder, including without
limitation Ground Lessee's right to exercise the option to purchase as set forth
in paragraph 17 of the Ground Lease.
9. Ground Lessee has completed all buildings and improvements required to
be constructed by Ground Lessee in accordance with all requirements of the
Ground Lease.
10. Ground Lessor has waived its right of first refusal to purchase the
Premises with respect to the assignment of the Ground Lease to Purchaser.
11. From and after the Purchaser's purchase of the Premises we understand
and agree that all notices to the Ground Lessee shall be sent as follows:
c/o Songy Partners Limited
95 South Federal Highway, Suite 200
Boca Raton, Florida 33432
12. The Ground Lessee has an option to purchase Ground Lessor's interest
in the Premises pursuant to and in accordance with the terms of paragraph 17 of
the Ground Lease, and such purchase option remains in full force and effect.
Any purchaser or assignee of the ground lessee's interest under the Ground Lease
shall be entitled to the benefits of the option. If exercised today the
purchase price would be $________. The purchase price in 2021 will be
$________.
13. This Estoppel Certificate (this "Certificate") may be relied upon and
shall inure to the benefit of Ground Lessee, Purchaser, any party providing
financing to Purchaser, and their respective successors and assigns and to any
party providing financing to any of them.
24
<PAGE>
14. 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.
Very truly yours,
, Ground Lessor
By:___________________________
Title:________________________
Date:_________________________
25
<PAGE>
EXHIBIT F
LITIGATION
----------
None.
26
<PAGE>
EXHIBIT G - 1
NOTICE TO TENANTS
-----------------
March ____, 1997
Re: Sale of Peachtree Palisades East Office Building
Atlanta, Georgia (the "Property")
Dear Tenant:
This is to notify you that the Property has been sold to _________________
and that ____________________________ has been retained by the new owner as
managing agent of the building.
Any security or other deposits and any prepaid rents under your lease have
been transferred to the new owner.
Effective immediately, all rental payments, notices to the Landlord, and
correspondence pursuant to your lease should be mailed to the following address:
_______________________________________________________________.
Very truly yours,
Equity Office Holdings, L.L.C.
a Delaware limited liability company,
as agent for Seller
By:_________________________________________
Its:________________________________________
27
<PAGE>
EXHIBIT G - 2
NOTICE TO PARTIES TO SERVICE CONTRACTS
--------------------------------------
March ___, 1997
Re: Sale of Peachtree Palisades East Office Building
Atlanta, Georgia (the "Property")
Dear Service Provider:
This is to notify you that the Property has been sold to __________________
("Purchaser"). All notices to Purchaser should be sent to Purchaser at the
office of the building, and should be sent or delivered to such address in the
manner provided in the service contract.
Very truly yours,
Equity Office Holdings, L.L.C.
a Delaware limited liability company,
as agent for Seller
By:_____________________________
It:_____________________________
28
<PAGE>
Schedule 1
Peachtree Palisades
List of Tenants
<TABLE>
<CAPTION>
- --------------------------------------------
Suite # Tenant Name
- --------------------------------------------
<S> <C>
104 ACJ & Associates
- --------------------------------------------
225 Belcher, Pakchar & Sams
- --------------------------------------------
Roof Bellsouth Mobility
- --------------------------------------------
200 Burke, Inc.
- --------------------------------------------
609 Central Pharmacy Services
- --------------------------------------------
604 Dearing & Klauber, P.C.
- --------------------------------------------
606 Dreger Realty Company, Inc.
- --------------------------------------------
420 Equity Office Properties
- --------------------------------------------
500 Factory's
- --------------------------------------------
101 G.M.E. Enterprises, Inc.
- --------------------------------------------
550 Hailey Realty Company
- --------------------------------------------
427 Hammer Siler George Assoc.
- --------------------------------------------
425 Hollberg, Weaver & Kytle
- --------------------------------------------
610 Intercept Technology, Inc.
- --------------------------------------------
530 Jacor Total Traffic Network
- --------------------------------------------
700 Jacor Broadcasting of Atlanta
- --------------------------------------------
605 Memorial-Pearl Corp.
- --------------------------------------------
602 Mudd Media, Inc.
- --------------------------------------------
230 National Business Furniture
- --------------------------------------------
105 Nationsbank
- --------------------------------------------
Rooftop Osborn Sound & Comm.
- --------------------------------------------
Rooftop Paging Network of Atlanta
- --------------------------------------------
Parking Peachtree Palisades Partners
- --------------------------------------------
612 Plunkett, O.H. & Company
- --------------------------------------------
102 Print Time, Inc.
- --------------------------------------------
303 Railcar Management, Inc.
- --------------------------------------------
455 Railcar, Ltd.
- --------------------------------------------
450 Roy Ashley & Associates
- --------------------------------------------
201 Satulah Group, Inc.
- --------------------------------------------
520 Thomas, Sam E.
- --------------------------------------------
620 Total Association Mgmt.
- --------------------------------------------
510 Triton, Inc.
- --------------------------------------------
699 Triton, Inc.
- --------------------------------------------
575 Van Winkle & Associates
- --------------------------------------------
600 Webb Vanderplate Hazzard
- --------------------------------------------
603 Weiss, Gantt, Joyce
- --------------------------------------------
</TABLE>
29
<PAGE>
EXHIBIT 2.6
- --------------------------------------------------------------------------------
CLOSING STATEMENT INFORMATION
- --------------------------------------------------------------------------------
Property Name: PEACHTREE PALISADES EAST OFFICE BUILDING
Seller: FIRST CAPITAL INSTITUTIONAL REAL ESTATE, LTD. - I
a Florida limited partnership
Purchaser: PALISADES I ASSOCIATES, LTD.
a Florida limited partnership
Proration Date: 5/5/97
Proration as of: 11:59 PM, MONDAY, MAY 5, 1997
Closing Date: 5/5/97
Closing as of: MONDAY, MAY 5, 1997
Tax Begin Date: 1/1/97
Tax End Date: 12/31/97
Month Begin Date 5/1/97
Month End Date 5/31/97
Railcar TI prorate date 12/1/96
<PAGE>
CLOSING STATEMENT
PEACHTREE PALISADES EAST OFFICE BUILDING
- --------------------------------------------------------------------------------
SELLER: FIRST CAPITAL INSTITUTIONAL REAL ESTATE, LTD. - I
a Florida limited partnership
PURCHASER: PALISADES I ASSOCIATES, LTD.
a Florida limited partnership
PRORATION DATE: 11:59 PM, MONDAY, MAY 5, 1997
CLOSING (FUNDING) MONDAY, MAY 5, 1997
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
CREDIT CREDIT
PURCHASER SELLER
--------------- ---------------
<S> <C> <C>
PURCHASE PRICE 7,885,000.00
EARNEST MONEY (held by Commonwealth Land Title Company of Chicago) 150,000.00
INTEREST ON EARNEST MONEY POC
PRO-RATE PROPERTY TAXES 24,216.02
[See Schedule A]
PRO-RATE MAY, 1997 LEASE CHARGES 44,018.55
[See Schedule D]
TENANT PREPAID RENTS 1,918.85
[See Schedule B]
PRO-RATE SERVICE CONTRACTS 1,018.24
[See Schedule C]
SECURITY DEPOSITS 81,332.04
[See Schedule D]
50% OF SURVEY COST PAID BY SELLER 1,150.00
[Note 5]
LEASING COSTS FOR RAILCAR 125,510.60
LEASING COSTS FOR MUDD MEDIA 9,260.59
LEASING COMMISSIONS (Burke Inc., Total Assoc. Management, Van Winkle) 5,864.43
PRESENT VALUE OF LAND PURCHASE PRICE $135,779.59
[$750,000 in 12/31/2021 discounted at 7.05% semi-annually]
--------------- ---------------
SUBTOTALS 293,562.87 8,021,939.43
CASH AMOUNT DUE TO SELLER 7,728,376.56
--------------- ---------------
TOTAL CREDITS 8,021,939.43 8,021,939.43
=============== ===============
</TABLE>
NOTES:
- ------
[1] All real estate taxes, personal property taxes and assessments relating to
the Property are to be reprorated or prorated upon receipt of actual
bill(s).
[2] Utility payments shall be directed to the parties for their respective
periods of ownership based upon meter reads order the day before the
Closing Date.
[3] Seller agrees to pay all invoices or charges payable to service contract
vendors or other vendors of supplies or services which are unpaid at
Closing and relate to periods prior to and including May 5, 1997, or which
relate to periods after Closing to the extent Seller received a credit from
Purchaser at Closing.
[4] Interest earned on the Earnest Money Deposit shall be returned directly to
Purchaser.
[5] Seller paid 100% of the survey cost of $2,300 prior to close. The credit is
for Purchaser to reimburse Seller for its share of the survey cost.
<PAGE>
APPROVED: SELLER APPROVED: PURCHASER
FIRST CAPITAL INSTITUTIONAL REAL ESTATE, LTD. -1 PALISADES 1 ASSOCIATES, LTD.
a Florida limited partnership a Florida limited partnership
By:__________________________ By:__________________________
<PAGE>
- --------------------------------------------------------------------------------
PEACHTREE PALISADES EAST OFFICE BUILDING
SOURCES AND USES STATEMENT
- --------------------------------------------------------------------------------
PURCHASER'S SOURCES AND USES:
----------------------------
<TABLE>
<CAPTION>
<S> <C> <C>
BALANCE OF CASH TO BE FUNDED BY PURCHASER 7,578,809.95
---------------
ADDITIONAL CASH OUTLAYS BY PURCHASER:
COMMONWEALTH LAND TITLE INSURANCE COMPANY OF CHICAGO
Title Insurance Premium (50%) 3,314.00
Lender's Title Insurance (100%) 150.00
Title Insurance Policy Endorsements (100%) 300.00
Survey (50%) POC
Survey Extras (zoning verifcation etc.) 802.50
Transfer Taxes (50%) 3,942.50
Escrow Fees (50%) 250.00
Copies (Commonwealth Land Title Co) 123.50
Binder Fees 3 (Commonwealth Land Title Co) 150.00
Tax Repors 2 (Commonwealth Land Title Co) 20.00
Out of Pocket Expenses (50%) 75.00
Search & Exam Fees (50%) 175.00
Deed Recording (50%) 250.00
---------------
PURCHASER'S CLOSING COSTS 9,552.50
---------------
TOTAL CASH OUTLAY BY PURCHASER 7,588,362.45
===============
- ---------------------------------------------------------------------------------------------------------------
SELLER'S SOURCES AND USES:
-------------------------
EARNEST MONEY 150,000.00
CASH AMOUNT DUE TO SELLER 7,578,809.95
---------------
TOTAL SELLER'S SOURCES 7,728,809.95
---------------
ITEMS PAYABLE FROM SELLER'S PROCEEDS AT CLOSING:
COMMONWEALTH LAND TITLE INSURANCE COMPANY OF CHICAGO
Title Insurance Premium (50%) 3,314.00
Survey (50%) POC
Transfer Taxes (50%) 3,942.50
Escrow Fees (50%) 250.00
Out of Pocket Expenses (50%) 75.00
Search & Exam Fees (50%) 175.00
Deed Recording (50%) 250.00
---------------
8,006.50
WITHHOLDING FOR GEORGIA DEPT OF REVENUE (Gains Tax of 3% on $3,541,871) 106,256.13
TOTAL CASH OUTLAY BY SELLER 114,262.63
---------------
BALANCE TO SELLER 7,614,547.32
===============
</TABLE>
<PAGE>
SCHEDULE A
- --------------------------------------------------------------------------------
PEACHTREE PALISADES EAST OFFICE BUILDING
PRO-RATE 1997 PROPERTY TAXES
PRORATION MADE AS OF: 11:59 PM, MONDAY, MAY 5, 1997
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C>
ACTUAL CALENDAR YEAR 1996 REAL ESTATE TAXES
-------------------------------------------
#17-0110-0003-047-9 70,710.79
-------------
ESTIMATED 1997 TAXES 70,710.79
PURCHASER'S PRORATA SHARE OF 1997 TAXES 240/365 65.753%
-------------
PURCHASER'S SHARE OF 1997 TAXES 46,494.77
SELLER'S SHARE OF 1997 TAXES 24,216.02
CREDIT DUE TO PURCHASER (SELLER): 24,216.02
=============
</TABLE>
[1] Purchaser and Seller will reprorate the 1997 real estate taxes after actual
bills are received and paid.
<PAGE>
SCHEDULE B
- --------------------------------------------------------------------------------
PEACHTREE PALISADES EAST OFFICE BUILDING
TENANT PREPAID RENTS
PRORATION MADE AS OF: 11:59 PM, MONDAY, MAY 5, 1997
- --------------------------------------------------------------------------------
AMOUNT
SUITE # TENANT NAME PREPAID
-------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C>
Prepaid Rent:
Burke, Inc. 1,867.59
Dearing & Klauber, P.C. 30.84
Memorial Pearl Corp. 20.42
-----------
CREDIT TO PURCHASER 1,918.85
==========
</TABLE>
<PAGE>
SCHEDULE C
- --------------------------------------------------------------------------------
PEACHTREE PALISADES EAST OFFICE BUILDING
RECURRING PAYABLES PRORATION
PRORATION MADE AS OF: 11:59 PM, MONDAY, MAY 5, 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
- --------------
Atlantic Elevator (690.00) 05/01/97 05/31/97 26 (578.71)
Carter & Assoc. (Burke lease comm) (65.52) 05/01/97 05/31/97 26 (54.95)
White & Assoc. (Total Assoc. Management) (30.83) 05/01/97 05/31/97 26 (25.86)
Lockerman-Davis (Van Winkle lease comm) (324.81) 05/01/97 05/31/97 26 (272.42)
ADT Alert (75.00) 04/01/97 06/30/97 56 (46.15)
Simplex Time Recorder (465.50) 04/01/97 03/31/98 330 (420.86)
Superior Water Services (156.00) 05/01/97 05/31/97 26 (130.84)
Panasonic Copier Service (604.20) 02/04/97 02/04/98 275 (453.98)
Citadel Secuirty (193.50) 05/01/97 05/31/97 26 (162.29)
------------
CREDIT TO DUE PURCHASER (SELLER) (2,146.06)
------------
PAYABLE BY PURCHASER
- --------------------
Peachtree Pest Control 140.00 04/01/97 05/31/97 35 80.33
Affordable Fire Protection 2,080.00 01/01/97 12/31/97 125 712.33
Botanical Environments 85.00 05/01/97 05/31/97 5 13.71
Greenscape (Walton Industries 325.00 05/01/97 05/31/97 5 52.42
Browning Ferris (BFI) 488.48 05/01/97 05/31/97 5 78.79
Valcourt Building Services 650.00 05/01/97 05/31/97 5 104.84
Aircond 529.50 05/01/97 05/31/97 5 85.40
------------
CREDIT TO DUE PURCHASER (SELLER) 1,127.82
------------
TOTAL CREDIT TO DUE PURCHASER (SELLER) (1,018.24)
===========
</TABLE>
<PAGE>
SCHEDULE D
- --------------------------------------------------------------------------------
PEACHTREE PALISADES EAST OFFICE BUILDING
RENTAL CHARGE, DEPOSIT RECONCILIATION, AND DELINQUENCY SCHEDULE
PRORATION MADE AS OF: 11:59 PM, MONDAY, MAY 5, 1997
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
MAY MAY MAY PR'S
TENANT MONTHLY ESCALATION OTHER TOTAL CHARGES PRORATA
TENANT DEPOSITS RENT CHARGES INCOME CHARGES PAID SHARE
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
ACJ & Associates 1,159.38 1,206.21 34.87 - 1,240.88 - -
ANI Roof Income - 1,636.08 - - 1,635.08 - -
Belcher, Pakchar & Same 2,989.10 3,244.73 126.85 - 3,371.68 - -
Burke, Inc. - 1,259.94 - - 1,259.94 1,259.94 1,068.72
Central Pharmacy Services 3,857.76 3,849.75 8.00 - 3,857.75 3,857.75 3,235.53
Dearing & Klauber, P.C. 2,387.67 2,709.08 35.04 - 2,744.12 2,744.12 2,301.52
Factory's - 2,711.04 134.59 - 2,845.63 608.85 610.65
Fawzi Khalaf/Brookview 2,169.99 775.00 - - 775.00 775.00 650.00
Halley Realty Company - 4,003.92 - - 4.003.92 4,003.92 3,358.13
Hammer Siler George Associates 2,504.67 2,890.00 101.21 - 2,991.21 - -
Hollberg, Weaver & Kytle 2,845.92 2,960.89 86.74 - 3,047.63 3,047.63 2,656.08
Intercept Technology 1,280.13 2,797.38 11.29 - 2,808.67 - -
Jacor-Total Traffic Net - 918.38 2.42 - 920.80 - -
Jacor Broadcasting of Atlanta 22,343.75 23,014.08 1,282.94 250.00 24,547.00 - -
Memorial-Pearl Corp. 800.00 867.26 11.54 - 878.80 878.80 737.06
Mudd Media, Inc. 3,090.92 1,500.92 - - 1,500.92 - -
National Business Furniture - 7,987.00 323.25 - 8,310.25 - -
Plunkett, O.H. & Company 2,524.67 2,575.16 34.77 - 2,609.93 73.18 61.38
Print Time, Inc. 4,644.87 4,662.91 - - 4,662.91 - -
Rallcar Management, Inc. - 23,803.75 718.96 - 24,522.70 24,522.70 20,567.43
Rallcar, Ltd. - 6,831.25 179.12 - 7,010.37 7,010.37 5,879.67
Roy Ashley & Associates 7,331.71 7,479.46 98.23 - 7,577.69 - -
Satulah Group 8,825.00 9,703.13 - - 9,703.13 - -
Thomas, Sam E./HMI Enterprises 3,250.20 3,446.47 77.95 - 3,524.42 (0.00) -
Total Association Mgmt. - 1,541.38 41.40 100.00 1,682.78 1,682.78 1,411.36
Triton, Inc. - 1,668.60 33.03 - 1,701.83 1,701.63 1,427.17
Triton, Inc. - 699 - 316.97 - - 316.97 316.97 285.85
Van Winkle & Associates 3,631.00 6,387.98 - - 6,387.98 - -
Webb Vanderplate Hazzard 3,417.16 3,492.91 45.53 - 3,538.44 - -
Weiss, Gantt, Joyce 2,498.15 2,424.89 30.74 - 2,455.83 (0.00) -
-----------------------------------------------------------------------------------------------------
81,332.04 138,665.50 3,418.26 350.00 142,433.76 52,483.64 44,018.55
<CAPTION>
- --------------------------------------------------------------------------------------
MAY
& PRIOR TOTAL TOTAL
BALANCE SR'S PR'S
TENANT O/S SHARE O/S SHARE O/S
- --------------------------------------------------------------------------------------
<S> <C> <C> <C>
ACJ & Associates 3,671.93 2,631.19 1,040.74
ANI Roof Income 3,270.16 1,898.80 1,371.36
Belcher, Pakchar & Same 3,580.88 753.10 2,827.78
Burke, Inc. - - -
Central Pharmacy Services 175.11 175.11 -
Dearing & Klauber, P.C. - - -
Factory's 2,236.78 360.77 1,876.01
Fawzi Khalaf/Brookview - - -
Halley Realty Company - - -
Hammer Siler George Associates 3,075.42 686.66 2,506.76
Hollberg, Weaver & Kytle - - -
Intercept Technology 3,751.26 1,396.60 2,355.66
Jacor-Total Traffic Net 1,055.80 283.52 772.28
Jacor Broadcasting of Atlanta 24,484.68 7,896.87 20,587.61
Memorial-Pearl Corp. - - -
Mudd Media, Inc. 1,690.92 432.08 1,258.84
National Business Furniture 9,213.75 2,243.86 6,989.89
Plunkett, O.H. & Company 2,536.75 409.15 2,127.60
Print Time, Inc. 5,111.54 1,200.71 3,910.83
Rallcar Management, Inc. 287.57 287.57 -
Rallcar, Ltd. 84.52 84.62 -
Roy Ashley & Associates 7,719.76 1,384.28 6,355.48
Satulah Group 12,960.45 4,822.34 8,138.11
Thomas, Sam E./HMI Enterprises 3,672.21 716.24 2,955.97
Total Association Mgmt. - - -
Triton, Inc. 178.98 178.99 -
Triton, Inc. - 699 - - -
Van Winkle & Associates 10,824.86 5,487.22 6,357.88
Webb Vanderplate Hazzard 4,147.85 1,180.13 2,967.72
Weiss, Gantt, Joyce 2,772.42 712.86 2,059.58
-------------------------------------------------
110,603.63 36,061.67 75,442.06
</TABLE>
NOTES:
- ------
<PAGE>
LAKEWOOD SQUARE SHOPPING CENTER
REAL ESTATE SALE AGREEMENT
--------------------------
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
--------
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
-----------------
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
1
<PAGE>
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
--------------
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.
-------------
(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.
2
<PAGE>
B. Cash at Closing. The Earnest Money shall be applied to the Purchase
---------------
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.
------------
3. EVIDENCE OF TITLE
-----------------
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
-------
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.
-----------------
(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
3
<PAGE>
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.
4
<PAGE>
(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;
5
<PAGE>
(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.
6
<PAGE>
(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>
