SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of earliest event reported) August 29, 1996
BALCOR PENSION INVESTORS - V
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Exact Name of Registrant
Illinois 0-13233
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State or other jurisdiction Commission file number
2355 Waukegan Road
Suite A200
Bannockburn, Illinois 36-3254673
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Address of principal I.R.S. Employer
executive offices Identification
Number
60015
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Zip Code
Registrant's telephone number, including area code:
(847) 267-1600
<PAGE>
ITEM 5. OTHER INFORMATION
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a) Noland Fashion Square
In 1989, the Partnership and two affiliates (together, the "Participants")
funded a $23,300,000 first mortgage loan (the "Loan") collateralized by the
Noland Fashion Square, Independence, Missouri. The Partnership's participating
percentage in the Loan is approximately 41%. As previously reported, the
Participants contracted to sell the Loan to an unaffiliated party, CS First
Boston Mortgage Capital Corp., for a sale price equal to 79.28% of the
principal balance of the Loan as of the closing date. The sale of the Loan
closed on August 22, 1996. The principal balance of the Loan at closing was
$22,356,107 and the sale price was $17,700,000. The Participants additionally
received a $25,000 premium from the purchaser.
From the proceeds of the sale, the Participants paid closing costs of $50,000
and $197,250 to an unaffiliated party as a commission. The Participants
received the remaining proceeds of $17,477,750 of which $250,000 will not be
available for use or distribution by the Participants until November 22, 1996.
The Partnership's share of the total net proceeds is approximately $7,166,000.
b) Waldengreen Apartments
In 1985, the Partnership funded a $2,250,000 loan evidenced by a promissory
note in the amount of $7,250,000 and secured by a wrap-around mortgage on the
Waldengreen Apartments, Orlando, Florida. In 1987, pursuant to a loan
modification, the Partnership funded an additional $3,350,000 on the loan. In
1993, the Partnership purchased the first mortgage loan which was held by an
unaffiliated party for $2,269,702. Subsequently, in 1993, the Partnership
obtained title to the property through foreclosure.
On August 29, 1996, the Partnership contracted to sell the property for a sale
price of $7,100,000 to an unaffiliated party, Southern Properties Fund, Inc., a
Florida corporation. The purchaser has deposited $150,000 into an escrow
account as earnest money and will pay the remaining $6,950,000 in cash at
closing, which is scheduled to occur no later than October 26, 1996. From the
proceeds of the sale, the Partnership will pay $177,500 to an unaffiliated
party as a brokerage commission and a fee of $88,750 to an affiliate of the
third party providing property management services for the property for
services rendered in connection with the sale. The Partnership will receive
the remaining proceeds of approximately $6,833,750, less closing costs.
Neither the General Partner nor any affiliate will receive a brokerage
commission in connection with the sale of the property. The General Partner
will be reimbursed by the Partnership for actual expenses incurred in
connection with the sale.
The closing is subject to the satisfaction of numerous terms and conditions.
There can be no assurance that all of the terms and conditions will be complied
with and, therefore, it is possible the sale of the property may not occur.
<PAGE>
c) 45 West 45th Street
As previously reported, on July 29, 1996, a limited partnership in which the
Partnership and three affiliates hold interests and which owns the 45 West 45th
Street Office Building, New York City, New York, contracted to sell the
property to an unaffiliated party, Olmstead Properties, Inc., a New York
corporation, for a sale price of $10,300,000. Pursuant to an agreement dated
August 12, 1996, the closing date has been extended from October 25, 1996 to
November 12, 1996. The purchaser has the option to further extend the closing
to a date no later than December 12, 1996 upon written notice no later than
October 26, 1996 and the deposit of an additional $200,000 in earnest money no
later than November 8, 1996.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
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(a) FINANCIAL STATEMENTS AND EXHIBITS:
None
(B) PRO FORMA FINANCIAL INFORMATION:
None
(C) EXHIBITS:
(99) (a) Agreement of Sale and attachments thereto relating to the
sale of the Waldengreen Apartments, Orlando, Florida.
(b) First Amendment to the Agreement of Sale relating the sale
of the 45 W. 45th Street Office Building, New York City,
New York.
No information is required under Items 1, 2, 3, 4, 6 and 8 and these items
have, therefore, been omitted.
<PAGE>
Signature
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Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this Report to be signed on its behalf by the
undersigned hereunto duly authorized.
BALCOR PENSION INVESTORS-V
By: Balcor Mortgage Advisors-V, an Illinois general
partnership, its general partner
By: The Balcor Company, a Delaware corporation,
a partner
By: /s/ Jerry M. Ogle
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Jerry M. Ogle, Vice President
and Secretary
Dated: September 20, 1996
<PAGE>
AGREEMENT OF SALE
THIS AGREEMENT OF SALE (this "Agreement"), is entered into as of the 29th
day of August, 1996, by and between SOUTHERN PROPERTIES FUND, INC., a Florida
corporation ("Purchaser"), and GREENWALD PARTNERS LIMITED PARTNERSHIP, an
Illinois limited partnership ("Seller").
W I T N E S S E T H:
1. PURCHASE AND SALE. Purchaser agrees to purchase and Seller agrees to sell
at the price of Seven Million One Hundred Thousand And No/100 Dollars
($7,100,000.00) (the "Purchase Price"), that certain improved real property
commonly known as Walden Green Apartments, Orlando, Florida, legally described
on Exhibit A attached hereto (the "Property"). Included in the Purchase Price
is all of the personal property set forth on Exhibit B attached hereto (the
"Personal Property").
2. PURCHASE PRICE. The Purchase Price shall be paid by Purchaser as follows:
2.1. Upon the execution of this Agreement, the sum of One Hundred Fifty
Thousand and No/100 Dollars ($150,000.00) (the "Initial Earnest Money") to be
held in escrow by and in accordance with the provisions of the Escrow Agreement
("Escrow Agreement") attached hereto as Exhibit C;
2.2. Upon the expiration of the Inspection Period (hereinafter defined),
the sum of One Hundred Fifty Thousand and No/100 Dollars ($150,000.00)
(together with the Initial Earnest Money, the "Earnest Money") to be held in
escrow by and in accordance with the provisions of the Escrow Agreement; and
2.3. On the "Closing Date" (hereinafter defined), the balance of the
Purchase Price, adjusted in accordance with the prorations, by federally wired
"immediately available" funds, on or before 11:00 a.m Chicago time to be paid
to Escrow Agent (as defined in the Escrow Agreement). The Escrow Agent shall
disburse the funds to Seller in accordance with Section 8 of this Agreement and
the provisions of the Escrow Agreement.
3. TITLE COMMITMENT AND SURVEY.
3.1. Within fifteen (15) days following the Effective Date (as defined
below), Purchaser shall procure, and deliver a copy thereof to Seller, for the
issuance by Weiss Serota & Helfman, P.A., as title agent (the "Title Agent"), a
commitment for title insurance (to be attached hereto as Exhibit D upon
issuance) by a title insurance company licensed to do business in the State of
Florida (the "Title Insurer") to issue to Purchaser, upon recording of the Deed
(as defined below) a fee owner's policy of title insurance in the amount of the
Purchase Price insuring the title of Purchaser to the Property, subject only to
the matters set forth in this Agreement, the Permitted Exceptions as defined
below, and the so-called "Standard Exceptions" as contained on the inside
jacket cover of the standard title insurance company owner's title commitment
(the "Commitment"). The cost of the Title Commitment, and the fee owner's
title insurance policy to be issued pursuant thereto shall be paid by
Purchaser. For purposes of this Agreement, only the following exceptions (the
"Permitted Exceptions") shall be permitted in the Title Commitment, the title
insurance policy and the Deed to be delivered to the Purchaser under the terms
of this Agreement: (a) Ad valorem taxes for the year in which the Closing
occurs and subsequent years; (b) zoning and other governmental restrictions as
disclosed on the Title Commitment; (c) matters shown on the plat of the
<PAGE>
Property; and (d) those matters expressly set forth in this Agreement and that
certain letter dated August 21, 1996 from Purchaser to Seller.
3.2. Purchaser shall have ten (10) days from the date of receipt of the
Title Commitment to examine the Title Commitment. If the Title Commitment
contains exceptions, other than the exceptions recognized in Section 3.1,
Purchaser shall, within such ten (10) day period, notify Seller in writing
specifying the title defects and/or unpermitted exceptions which render title
unmarketable (the "Unpermitted Exceptions"). Seller shall have thirty (30)
days from its receipt of notice from Purchaser within which to remove the
defects, and shall exercise all reasonable diligence in doing so. If Seller is
unsuccessful in removing the defects within such time, in spite of having
exerted all reasonable efforts to do so, Purchaser shall have the option either
to (i) accept title as it then is, or (ii) upon written notice to Seller and
Escrow Agent, refuse to close on the Agreement, in which latter event, the
Escrow Agent shall promptly return the Deposit to Purchaser and all parties
shall be released from liability hereunder. Should Purchaser fail timely to
object to any matters set forth in the Title Commitment, Purchaser shall be
deemed to have waived its right to object thereto.
3.3. The Title Commitment shall provide that the standard exceptions
relating to (i) the rights of claims of parties in possession not shown by the
Public Records; (ii) assessments and/or improvement liens; (ii) any lien, or
right to a lien, for services, labor, or material imposed by law and not shown
in the Public Records; and (iv) any claim that part of the Property is owned by
the State of Florida by right of sovereignty and/or riparian rights will be
deleted by the Title Agent upon Seller's furnishing to the Title Agent a Lien,
Possession and Encumbrance Affidavit in the customary form (and Seller agrees
to furnish such affidavit prior to the closing), and shall further provide that
the standard exceptions relating to easements or claims of easements not shown
in the Public Records and encroachments, overlaps, boundary line disputes, and
other matters which would be disclosed by an accurate survey or inspection of
the property will be deleted by the Title Agent upon receipt by the Title Agent
of the Updated Survey together with a so-called "Surveyor's Report" relating
thereto on the prescribed title insurance company form. The Lien, Possession
and Encumbrance Affidavit referred to above shall certify that no one other
than Seller is in possession of the Property and that no work has been done and
no materials, labor or services were furnished to, or for the benefit or
improvement of the Property at the request of Seller or its privies other than
Purchaser, its agents or privies, prior to the Closing Date which could serve
as the basis for any liens or claims against the Property.
3.4. Prior to the Closing Date (as defined below), the Title Agent shall
conduct an examination of the Public Records of Orange County, Florida, from
the effective date of the Title Commitment to a date as proximate to the
Closing Date as possible and shall issue an endorsement to the Title Commitment
changing the effective date thereof to a date through which the Title Agent has
examined title, which endorsement shall reflect any title matters occurring
during the period searched. Said endorsement shall likewise contain the
affirmative commitment of the title insurance company to insure the so-called
"gap period" in accordance with Section 627.7841, Florida Statutes, as amended.
<PAGE>
3.5. Purchaser has received a Plat of Survey of the Property prepared by
Hart Surveys, Inc. (the "Existing Survey"). Purchaser shall pay for the costs
of updating the Existing Survey and Seller shall deliver the updated survey
(the "Updated Survey") to Purchaser within fifteen (15) days after the date
hereof. The Updated Survey shall be prepared in accordance with the Minimum
Technical Standards for Surveys in the State of Florida (Chapter 61G17-6,
Florida Administrative Code) and otherwise acceptable to the Title Insurer to
delete the standard survey exception. Purchaser shall have fourteen (14) days
from receipt of the Updated Survey within which to examine the Updated Survey
and to notify Seller in writing if the Updated Survey shows any encroachments
or violates any of the Agreement covenants. Survey objections shall be treated
in the same manner as objections based on title defects. The Updated Survey
shall be certified to Purchaser, Title Agent and Title Insurer. Purchaser
hereby acknowledges that all matters disclosed by the Existing Survey are
acceptable to Purchaser.
3.6. The obligation of Purchaser to pay various costs set forth in
Paragraphs 3.1 and 3.5 shall survive the termination of this Agreement.
4. PAYMENT OF CLOSING COSTS.
4.1. In addition to the costs set forth in Paragraphs 3.1 and 3.5, Seller
shall pay for the costs of the documentary or transfer stamps to be paid with
reference to the "Deed" (hereinafter defined); all other stamps, intangible,
transfer, documentary, recording, sales tax and surtax imposed by law with
reference to any other sale documents delivered in connection with the sale of
the Property to Purchaser; and the cost of preparation and recording of all
corrective instruments. Purchaser shall pay for all other charges of the Title
Insurer in connection with this transaction.
5. CONDITION OF TITLE.
5.1. If, prior to "Closing" (as hereinafter defined), a date-down to the
Title Commitment or the Updated Survey discloses any new Unpermitted Exception,
Seller shall have thirty (30) days from the date of the date-down to the Title
Commitment or the Updated Survey, as applicable, at Seller's expense, to (i)
bond over, cure and/or have any Unpermitted Exceptions which, in the aggregate,
do not exceed $25,000.00, removed from the Title Commitment, or (ii) have the
right, but not the obligation, to bond over, cure and/or have any Unpermitted
Exceptions which, in the aggregate, equal or exceed $25,000.00, removed from
the Title Commitment. In such event, the time of Closing shall be delayed, if
necessary, to give effect to said aforementioned time periods. If Seller fails
to cure or have said Unpermitted Exception removed within said thirty (30) day
period or if Seller elects not to exercise its rights under (ii) in the
preceding sentence, Purchaser may terminate this Agreement upon notice to
Seller within five (5) days after the expiration of said thirty (30) day
period. Absent notice from Purchaser to Seller in accordance with the
preceding sentence, Purchaser shall be deemed to have elected to take title
subject to said Unpermitted Exception. If Purchaser terminates this Agreement
in accordance with the terms of this Paragraph 5.1, this Agreement shall become
null and void without further action of the parties and all Earnest Money
theretofore deposited into the escrow by Purchaser together with any interest
accrued thereon, shall be returned to Purchaser, and neither party shall have
any further liability to the other, except for Purchaser's obligation to
indemnify Seller and restore the Property, as more fully set forth in Paragraph
7.
<PAGE>
5.2. Seller agrees to convey on the Closing Date fee simple title to the
Property to Purchaser by special warranty deed (the "Deed") in recordable form
subject only to the Permitted Exceptions and any Unpermitted Exceptions waived
by Purchaser.
6. CONDEMNATION, EMINENT DOMAIN, DAMAGE AND CASUALTY.
6.1. Except as provided in the indemnity provisions contained in
Paragraph 7.1 of this Agreement, Seller shall bear all risk of loss with
respect to the Property up to the earlier of the dates upon which either
possession or title is transferred to Purchaser in accordance with this
Agreement. Notwithstanding the foregoing, in the event of damage to the
Property by fire or other casualty prior to the Closing Date, repair of which
would cost less than or equal to $100,000.00 (as determined by Seller in good
faith) Purchaser shall not have the right to terminate its obligations under
this Agreement by reason thereof, but Seller shall have the right to elect to
either repair and restore the Property (in which case the Closing Date shall be
extended until completion of such restoration, such extension not to exceed
sixty (60) days) or to assign and transfer to Purchaser on the Closing Date all
of Seller's right, title and interest in and to all insurance proceeds paid or
payable to Seller on account of such fire or casualty; provided such insurance
proceeds are sufficient to repair and restore the Property. In the event that
such insurance proceeds are insufficient to repair and restore the Property,
this Agreement may be terminated at the option of Purchaser, which option shall
be exercised, if at all, by Purchaser's written notice thereof to Seller within
five (5) business days after Purchaser receives written notice of such fire or
other casualty and Seller's determination of the amount of such damages and the
amount of insurance proceeds, and upon the exercise of such option by Purchaser
this Agreement shall become null and void, the Earnest Money deposited by
Purchaser shall be returned to Purchaser together with interest thereon, and
neither party shall have any further liability or obligations hereunder.
Seller shall promptly notify Purchaser in writing of any such fire or other
casualty and Seller's determination of the cost to repair the damage caused
thereby. In the event of damage to the Property by fire or other casualty
prior to the Closing Date, repair of which would cost in excess of $100,000.00
(as determined by Seller in good faith), then this Agreement may be terminated
at the option of Purchaser, which option shall be exercised, if at all, by
Purchaser's written notice thereof to Seller within five (5) business days
after Purchaser receives written notice of such fire or other casualty and
Seller's determination of the amount of such damages, and upon the exercise of
such option by Purchaser this Agreement shall become null and void, the Earnest
Money deposited by Purchaser shall be returned to Purchaser together with
interest thereon, and neither party shall have any further liability or
obligations hereunder. In the event that Purchaser does not exercise the
option set forth in the preceding sentence, the Closing shall take place on the
Closing Date and Seller shall assign and transfer to Purchaser on the Closing
Date all of Seller's right, title and interest in and to all insurance proceeds
paid or payable to Seller on account of the fire or casualty.
<PAGE>
6.2. If between the date of this Agreement and the Closing Date, any
condemnation or eminent domain proceedings are initiated which might result in
the taking of any part of the Property or the taking or closing of any right of
access to the Property, Seller shall immediately notify Purchaser of such
occurrence. In the event that the taking of any part of the Property shall:
(i) materially impair access to the Property; (ii) cause any material
non-compliance with any applicable law, ordinance, rule or regulation of any
federal, state or local authority or governmental agencies having jurisdiction
over the Property or any portion thereof; or (iii) materially and adversely
impair the use of the Property as it is currently being operated (hereinafter
collectively referred to as a "Material Event"), Purchaser may:
6.2.1. terminate this Agreement by written notice to Seller, in
which event the Earnest Money deposited by Purchaser, together with interest
thereon, shall be returned to Purchaser and all rights and obligations of the
parties hereunder with respect to the closing of this transaction will cease;
or
6.2.2. proceed with the Closing, in which event Seller shall assign
to Purchaser all of Seller's right, title and interest in and to any award made
in connection with such condemnation or eminent domain proceedings.
6.3. Purchaser shall then notify Seller, within five (5) business days
after Purchaser's receipt of Seller's notice, whether Purchaser elects to
exercise its rights under Paragraph 6.2.1 or Paragraph 6.2.2. Closing shall be
delayed, if necessary, until Purchaser makes such election. If Purchaser fails
to make an election within such five (5) business day period, Purchaser shall
be deemed to have elected to exercise its rights under Paragraph 6.2.2. If
between the date of this Agreement and the Closing Date, any condemnation or
eminent domain proceedings are initiated which do not constitute a Material
Event, Purchaser shall be required to proceed with the Closing, in which event
Seller shall assign to Purchaser all of Seller's right, title and interest in
and to any award made in connection with such condemnation or eminent domain
proceedings.
7. INSPECTION AND AS-IS CONDITION.
7.1. During the period commencing on July 10, 1996 and ending at 5:00
p.m. Chicago time on September 26, 1996 (said period being herein referred to
as the "Inspection Period"), Purchaser and the agents, engineers, employees,
contractors and surveyors retained by Purchaser may enter upon the Property, at
any reasonable time and upon reasonable prior notice to Seller, to inspect the
Property, including a review of leases located at the Property, and to conduct
and prepare such studies, tests and surveys as Purchaser may deem reasonably
necessary and appropriate. In connection with Purchaser's review of the
Property, Seller agrees to deliver to Purchaser copies of the current rent roll
for the Property, the most recent tax and insurance bills, utility account
numbers, service contracts, unaudited year end 1995 and year to date 1996
operating statements and evidence of title accompanied by copies of title
exception documents. Furthermore, if the following are reasonably available to
Seller, Seller shall deliver to Purchaser plans and specifications,
environmental and third-party engineering reports.
<PAGE>
All of the foregoing tests, investigations and studies to be conducted
under this Paragraph 7.1 by Purchaser shall be at Purchaser's sole cost and
expense and Purchaser shall restore the Property to the condition existing
prior to the performance of such tests or investigations by or on behalf of
Purchaser. Purchaser shall defend, indemnify and hold Seller and any
affiliate, parent of Seller, and all shareholders, employees, officers and
directors of Seller or Seller's affiliate or parent (hereinafter collectively
referred to as "Affiliate of Seller") harmless from any and all liability, cost
and expense (including without limitation, reasonable attorney's fees, court
costs and costs of appeal) suffered or incurred by Seller or Affiliates of
Seller for injury to persons or property caused by Purchaser's investigations
and inspection of the Property. Purchaser shall undertake its obligation to
defend set forth in the preceding sentence using attorneys selected by Seller,
in Seller's sole discretion.
Prior to commencing any such tests, studies and investigations, Purchaser
shall furnish to Seller a certificate of insurance evidencing comprehensive
general public liability insurance insuring the person, firm or entity
performing such tests, studies and investigations and listing Seller and
Purchaser as additional insureds thereunder.
If Purchaser, in its sole and absolute discretion, is dissatisfied with
the results of the tests, studies or investigations performed or information
received pursuant to this Paragraph 7.1, Purchaser shall have the right to
terminate this Agreement by giving written notice of such termination to Seller
at any time prior to the expiration of the Inspection Period. If written
notice is not received by Seller pursuant to this Paragraph 7.1 prior to the
expiration of the Inspection Period, then the right of Purchaser to terminate
this Agreement pursuant to this Paragraph 7.1 shall be waived. If Purchaser
terminates this Agreement by written notice to Seller prior to the expiration
of the Inspection Period: (i) Purchaser shall promptly deliver to Seller copies
of all studies, reports and other investigations obtained by Purchaser in
connection with its due diligence during the Inspection Period; and (ii) the
Earnest Money deposited by Purchaser shall be immediately paid to Purchaser,
together with any interest earned thereon, and neither Purchaser nor Seller
shall have any right, obligation or liability under this Agreement, except for
Purchaser's obligation to indemnify Seller and restore the Property, as more
fully set forth in this Paragraph 7.1. Notwithstanding anything contained
herein to the contrary, the terms of this Paragraph 7.1, shall survive the
Closing and the delivery of the Deed and termination of this Agreement.
7.2. Seller acquired title to the Property by foreclosure (or
deed-in-lieu thereof) and, therefore, Seller can make no representations or
warranties relating to the condition of the Property or the Personal Property.
Purchaser acknowledges and agrees that except with respect to the
representations and warranties contained herein, it will be purchasing the
Property and the Personal Property based solely upon its inspections and
investigations of the Property and the Personal Property, and that Purchaser
will be purchasing the Property and the Personal Property "AS IS" and "WITH ALL
FAULTS", based upon the condition of the Property and the Personal Property as
of the date of this Agreement, wear and tear and loss by fire or other casualty
or condemnation excepted. Without limiting the foregoing, Purchaser
acknowledges that, except as may otherwise be specifically set forth elsewhere
in this Agreement, neither Seller nor its consultants, brokers or agents have
made any representations or warranties of any kind upon which Purchaser is
relying as to any matters concerning the Property or the Personal Property,
including, but not limited to, the condition of the land or any improvements
<PAGE>
comprising the Property, the existence or non-existence of "Hazardous
Materials" (as hereinafter defined), economic projections or market studies
concerning the Property, any development rights, taxes, bonds, covenants,
conditions and restrictions affecting the Property, water or water rights,
topography, drainage, soil, subsoil of the Property, the utilities serving the
Property or any zoning or building laws, rules or regulations or "Environmental
Laws" (hereinafter defined) affecting the Property. Seller makes no
representation or warranty that the Property complies with Title III of the
Americans with Disabilities Act or any fire code or building code. Except with
respect to a breach by Seller of any representation or warranty expressly
contained herein with respect to environmental matters, Purchaser hereby
releases Seller and the Affiliates of Seller from any and all liability in
connection with any claims regarding environmental matters which Purchaser may
have against Seller or the Affiliates of Seller, and except with respect to a
breach by Seller of any representation or warranty expressly contained herein
with respect to environmental matters, Purchaser hereby agrees not to assert
any claims for contribution, cost recovery or otherwise, against Seller or the
Affiliates of Seller, relating directly or indirectly to the existence of
asbestos or Hazardous Materials on, or environmental conditions of, the
Property, whether known or unknown. As used herein, "Environmental Laws" means
all federal, state and local statutes, codes, regulations, rules, ordinances,
orders, standards, permits, licenses, policies and requirements (including
consent decrees, judicial decisions and administrative orders) relating to the
protection, preservation, remediation or conservation of the environment or
worker health or safety, all as amended or reauthorized, or as hereafter
amended or reauthorized, including without limitation, the Comprehensive
Environmental Response, Compensation and Liability Act ("CERCLA"), 42 U.S.C.
Section 9601 et seq., the Resource Conservation and Recovery Act of 1976
("RCRA"), 42 U.S.C. Section 6901 et seq., the Emergency Planning and Community
Right-to-Know Act ("Right-to-Know Act"), 42 U.S.C. Section 11001 et seq., the
Clean Air Act ("CAA"), 42 U.S.C. Section 7401 et seq., the Federal Water
Pollution Control Act ("Clean Water Act"), 33 U.S.C. Section 1251 et seq., the
Toxic Substances Control Act ("TSCA"), 15 U.S.C. Section 2601 et seq., the Safe
Drinking Water Act ("Safe Drinking Water Act"), 42 U.S.C. Section 300f et seq.,
the Atomic Energy Act ("AEA"), 42 U.S.C. Section 2011 et seq., the Occupational
Safety and Health Act ("OSHA"), 29 U.S.C. Section 651 et seq., and the
Hazardous Materials Transportation Act (the "Transportation Act"), 49 U.S.C.
Section 1802 et seq. As used herein, "Hazardous Materials" means:
(1) "hazardous substances," as defined by CERCLA; (2) "hazardous wastes," as
defined by RCRA; (3) any radioactive material including, without limitation,
any source, special nuclear or by-product material, as defined by AEA; (4)
asbestos in any form or condition; (5) polychlorinated biphenyls; and (6) any
other material, substance or waste to which liability or standards of conduct
may be imposed under any Environmental Laws. Notwithstanding anything
contained herein to the contrary, the terms of this Paragraph 7.2 shall survive
the Closing and the delivery of the Deed and termination of this Agreement.
7.3. Seller has provided to Purchaser certain unaudited historical
financial information regarding the Property relating to certain periods of
time in which Seller owned the Property. Seller and Purchaser hereby
acknowledge that such information has been provided to Purchaser at Purchaser's
request solely as illustrative material. Except as expressly set forth herein,
Seller makes no representation or warranty that such material is complete or
accurate or that Purchaser will achieve similar financial or other results with
respect to the operations of the Property, it being acknowledged by Purchaser
that Seller's operation of the Property and allocations of revenues or expenses
may be vastly different than Purchaser may be able to attain. Purchaser
<PAGE>
acknowledges that it is a sophisticated and experienced purchaser of real
estate and further that Purchaser has relied upon its own investigation and
inquiry with respect to the operation of the Property and the representations
and warranties of Seller expressly contained herein, and releases Seller and
the Affiliates of Seller from any liability with respect to such historical
information, except with respect to a breach of a representation or warranty of
Seller contained herein. Notwithstanding anything contained herein to the
contrary, the terms of this Paragraph 7.3 shall survive the Closing and the
delivery of the Deed and termination of this Agreement.
7.4. Seller has provided to Purchaser the following existing report:
Report of Phase I Environmental Site Assessment and Limited Asbestos Survey
dated June 10, 1991 prepared by Law Associates, Inc. ("Existing Report").
Seller makes no representation or warranty concerning the accuracy or
completeness of the Existing Report. Purchaser hereby releases Seller and the
Affiliates of Seller from any liability whatsoever with respect to the Existing
Report, or, including, without limitation, the matters set forth in the
Existing Report, and the accuracy and/or completeness of the Existing Report.
Furthermore, Purchaser acknowledges that it will be purchasing the Property
with all faults disclosed in the Existing Report. Notwithstanding anything
contained herein to the contrary, the terms of this Paragraph 7.4 shall survive
the Closing and the delivery of the Deed and termination of this Agreement.
8. CLOSING. Subject to the provisions contained in this Agreement, the
closing of this transaction (the "Closing") shall be held within thirty (30)
days following expiration of the Inspection Period, upon ten (10) days prior
written notice from Purchaser to Seller (the "Closing Date"), at the office of
Title Agent, at which time Seller shall deliver the Deed and all other closing
documents, as well as possession of the Property, to Purchaser. This
transaction shall be closed through an escrow with Escrow Agent, in accordance
with the general provisions of the usual and customary form of deed and money
escrow for similar transactions in Florida or at the option of either party,
the Closing shall be a "New York style" closing at which the Purchaser shall
wire the Purchase Price (net of the Earnest Money and any other closing
adjustments) to Escrow Agent on the Closing Date and prior to the release of
the Purchase Price to Seller, Purchaser shall receive the Deed and all other
closing documents, as well as the Title Policy or marked up commitment dated
the date of the Closing Date. In the event of a New York style closing, Seller
shall deliver to Title Insurer any customary affidavit in connection with a New
York style closing. All closing and escrow fees, if any, shall be paid by
Seller.
9. CLOSING DOCUMENTS.
9.1. On or prior to the Closing Date, Seller and Purchaser shall execute
and deliver to one another a joint closing statement. In addition, Purchaser
shall deliver to Seller the balance of the Purchase Price, an assumption of the
documents set forth in Paragraph 9.2.3 and 9.2.4 and such other documents as
may be reasonably required by the Title Insurer in order to consummate the
transaction as set forth in this Agreement.
9.2. On the Closing Date, Seller shall deliver to Purchaser the
following:
<PAGE>
9.2.1. the Deed (in the form of Exhibit E attached hereto), subject
to Permitted Exceptions and those Unpermitted Exceptions waived by Purchaser;
9.2.2. a special warranty bill of sale conveying the Personal
Property (in the form of Exhibit F attached hereto);
9.2.3. assignment and assumption of intangible property (in the form
attached hereto as Exhibit G), including, without limitation, the service
contracts listed in Exhibit H;
9.2.4. an assignment and assumption of leases and security deposits
(in the form attached hereto as Exhibit I);
9.2.5. non-foreign affidavit (in the form of Exhibit J attached
hereto);
9.2.6. original, and/or copies of, leases affecting the Property in
Seller's possession (which shall be delivered at the Property);
9.2.7. all documents and instruments reasonably required by the
Title Agent and/or Title Insurer to issue the Title Policy, including, but not
limited to, a Lien, Possession and Encumbrance Affidavit;
9.2.8. possession of the Property to Purchaser, subject to the terms
of leases;
9.2.9. evidence of the termination of the management agreement;
9.2.10. notice to the tenants of the Property of the transfer of
title and assumption by Purchaser of the landlord's obligation under the leases
and the obligation to refund the security deposits (in the form of Exhibit K);
and
9.2.11. an updated rent roll.
10. PURCHASER'S DEFAULT. ALL EARNEST MONEY DEPOSITED INTO THE ESCROW IS TO
SECURE THE TIMELY PERFORMANCE BY PURCHASER OF ITS OBLIGATIONS AND UNDERTAKINGS
UNDER THIS AGREEMENT. IN THE EVENT OF A DEFAULT OF THE PURCHASER UNDER THE
PROVISIONS OF THIS AGREEMENT, SELLER SHALL RETAIN ALL OF THE EARNEST MONEY AND
THE INTEREST THEREON AS SELLER'S SOLE RIGHT TO DAMAGES OR ANY OTHER REMEDY,
EXCEPT FOR PURCHASER'S OBLIGATIONS TO INDEMNIFY SELLER AND RESTORE THE PROPERTY
AS SET FORTH IN PARAGRAPH 7.1 HEREOF. THE PARTIES HAVE AGREED THAT SELLER'S
ACTUAL DAMAGES, IN THE EVENT OF A DEFAULT BY PURCHASER, WOULD BE EXTREMELY
DIFFICULT OR IMPRACTICAL TO DETERMINE. THEREFORE, BY PLACING THEIR INITIALS
BELOW, THE PARTIES ACKNOWLEDGE THAT THE EARNEST MONEY HAS BEEN AGREED UPON,
AFTER NEGOTIATION, AS FULL AND LIQUIDATED DAMAGES IN THE EVENT OF PURCHASER'S
DEFAULT.
11. SELLER'S DEFAULT. IF THIS SALE IS NOT COMPLETED BECAUSE OF SELLER'S
DEFAULT, PURCHASER'S SOLE REMEDY SHALL BE THE RETURN OF ALL EARNEST MONEY
TOGETHER WITH ANY INTEREST ACCRUED THEREON, AND THIS AGREEMENT SHALL THEN
BECOME NULL AND VOID AND OF NO EFFECT AND THE PARTIES SHALL HAVE NO FURTHER
LIABILITY TO EACH OTHER AT LAW OR IN EQUITY, EXCEPT FOR PURCHASER'S OBLIGATIONS
TO INDEMNIFY SELLER AND RESTORE THE PROPERTY AS SET FORTH MORE FULLY IN
PARAGRAPH 7 AND PURCHASER'S RIGHT TO RECEIVE FROM SELLER ITS ACTUAL, DOCUMENTED
THIRD PARTY EXPENSES INCURRED IN THE PERFORMANCE OF ITS DUE DILIGENCE HEREUNDER
AND THE PREPARATION OF THIS AGREEMENT NOT TO EXCEED $50,000.00 IN THE
<PAGE>
AGGREGATE. NOTWITHSTANDING ANYTHING CONTAINED HEREIN TO THE CONTRARY, IF
SELLER'S DEFAULT IS ITS WILLFUL REFUSAL TO DELIVER THE DEED, THEN PURCHASER
WILL BE ENTITLED TO SUE FOR SPECIFIC PERFORMANCE.
12. PRORATIONS.
12.1. Rents (exclusive of delinquent rents, but including prepaid rents);
refundable security deposits (which will be assigned to and assumed by
Purchaser and credited to Purchaser at Closing); water and other utility
charges; fuels; prepaid operating expenses; management fees in the amount of
5.0%; real and personal property taxes prorated on a "net" basis (i.e. adjusted
for all tenants' liability, if any, for such items); operating expenses which
are reimbursable by the tenants for the period prior to the Closing Date less
any amount previously paid by the Tenants shall be credited to Seller; and
other similar items shall be adjusted ratably as of 11:59 p.m. on the Closing
Date, and credited against the balance of the cash due at Closing. Certified,
confirmed and ratified special assessment liens and pending special assessment
liens as of the day before the Closing Date shall be paid by Seller at Closing.
If the amount of any of the items to be prorated is not then ascertainable, the
adjustments thereof shall be on the basis of the most recent ascertainable
data. All prorations will be final except as to delinquent rent referred to in
Paragraph 12.2 below.
12.2. All rent paid following the Closing Date by any tenant of the
Property who is indebted under a lease for rent for any period prior to and
including the Closing Date shall be deemed a "Post-Closing Receipt" until such
time as all such indebtedness is paid in full. Within ten (10) days following
each receipt by Purchaser of a Post-Closing Receipt, Purchaser shall pay such
Post-Closing Receipt to Seller. Purchaser shall use reasonable efforts to
collect all amounts which, upon collection, would constitute Post-Closing
Receipts hereunder; provided, however, Purchaser shall have no obligation to
institute proceedings against any tenant. Within 120 days after the Closing
Date, Purchaser shall deliver to Seller a reconciliation statement of
Post-Closing Receipts through the first 90 days after the Closing Date. Upon
the delivery of the Post-Closing Receipts reconciliation, Purchaser shall
deliver to Seller any Post-Closing Receipts owing to Seller and not previously
delivered to Seller in accordance with the terms hereof. Seller retains the
right to conduct an audit, at reasonable times and upon reasonable notice, of
Purchaser's books and records to verify the accuracy of the Post-Closing
Receipts reconciliation statement and upon the verification of additional funds
owing to Seller, Purchaser shall pay to Seller said additional Post-Closing
Receipts and the cost of performing Seller's audit. Paragraph 12.2 of this
Agreement shall survive the Closing and the delivery and recording of the deed.
13. RECORDING. Neither this Agreement nor a memorandum thereof shall be
recorded and the act of recording by Purchaser shall be an act of default
hereunder by Purchaser and subject to the provisions of Paragraph 10 hereof.
14. ASSIGNMENT. The Purchaser shall not have the right to assign its interest
in this Agreement without the prior written consent of the Seller; provided,
however, Purchaser may assign this Agreement to an entity of which Michael D.
Wohl owns a controlling interest. Notwithstanding the foregoing, Purchaser may
assign its interest in this Agreement without the consent of Seller to any
entity in which Purchaser owns a controlling interest provided that Purchaser
remains liable for and the assignee assumes the obligations of Purchaser
hereunder. Except as provided herein, any assignment or transfer of, or attempt
to assign or transfer, Purchaser's interest in this Agreement shall be an act
<PAGE>
of default hereunder by Purchaser and subject to the provisions of Paragraph 10
hereof.
15. BROKER. The parties hereto represent and warrant that no broker
commission or finder fee is due and payable in connection with this transaction
other than to CB Commercial (to be paid by Seller). Seller's commission to CB
Commercial shall only be payable out of the proceeds of the sale of the
Property in the event the transaction set forth herein closes. Purchaser and
Seller shall indemnify, defend and hold the other party hereto harmless from
any claim whatsoever (including without limitation, reasonable attorney's fees,
court costs and costs of appeal) from anyone claiming by or through the
indemnifying party any fee, commission or compensation on account of this
Agreement, its negotiation or the sale hereby contemplated other than to CB
Commercial. The indemnifying party shall undertake its obligations set forth
in this Paragraph 15 using attorneys selected by the indemnifying party and
reasonably acceptable to the indemnified party. The provisions of this
Paragraph 15 will survive the Closing and delivery of the Deed.
16. REPRESENTATIONS AND WARRANTIES.
16.1. Any reference herein to Seller's knowledge or notice of any matter
or thing shall only mean such knowledge or notice that has actually been
received by Daniel L. Charleston (the "Seller's Representative"), and any
representation or warranty of the Seller is based upon those matters of which
the Seller's Representative has actual knowledge. Any knowledge or notice
given, had or received by any of Seller's agents, servants or employees shall
not be imputed to Seller, the general partner or limited partners of Seller,
the subpartners of the general partner or limited partners of Seller or
Seller's Representative.
16.2. Subject to the limitations set forth in Paragraph 16.1, Seller
hereby makes the following representations and warranties, which
representations and warranties are made to Seller's knowledge and which shall
not survive Closing: (i) Seller has no knowledge of any pending or threatened
litigation, claim, cause of action or administrative proceeding concerning the
Property; (ii) Seller has the power to execute and deliver this Agreement and
consummate the transactions contemplated herein; (iii) the rent roll attached
hereto as Exhibit L which Seller will update as of the Closing Date is accurate
as of the date set forth thereon; (iv) except as disclosed in the Existing
Report, there exist no uncured notices of violations of law, rules or
regulations affecting the Property, and no commitments have been made to any
governmental authority, utility company, or any other organization, group or
individual imposing an obligation to commit any portion of the Property for any
form of public or private use (except for such commitments relating to the
documents, licenses and easements of record disclosed by the Title Commitment);
and (v) except as disclosed in the Existing Report, Seller has not given, nor
has received, any notice, letter, citation, order, warning, complaint, inquiry,
claim or demand that: (a) the Seller has violated any Environmental Laws, (b)
there has been release of hazardous substances, pollutants or contaminants as
defined in Environmental Laws on the Property, (c) the Seller is liable, in
whole or in part, for the costs or cleaning up, remediating, removing or
responding to a release of hazardous substances, pollutants or contaminants,
and (d) the Property is subject to a lien in favor of any governmental entity
for any liability, costs or damages, under Environmental Laws.
<PAGE>
16.3. Purchaser hereby represents and warrants to Seller that
Purchaser has the full right, power and authority to execute and deliver this
Agreement and consummate the transactions contemplated herein.
16.4. Seller covenants to operate and manage the Property in the same
manner that it has managed, maintained and operated the Property during the
period of Seller's ownership, subject to reasonable wear and tear and casualty.
16.5. If at any time after the execution of this Agreement, either
Purchaser or Seller become aware of information which makes a representation
and warranty contained in this Agreement to become untrue in any material
respect, said party shall promptly disclose said information to the other party
hereto. Provided the party making the representation or warranty did not take
any deliberate actions to cause the representation or warranty in question to
become untrue in any material respect, said party shall not be in default under
this Agreement and the sole remedy of the other party shall be to terminate
this Agreement. Notwithstanding anything contained herein to the contrary, if
the status of any of the tenancies changes from the date of the rent roll
attached hereto and the date of the rent roll delivered at Closing, provided
the change in status is not caused by a breach of Seller's covenants contained
herein, then Purchaser shall not have the right to terminate this Agreement or
make any claim for a breach of a representation or warranty hereunder involving
the rent roll or tenancies thereunder. Purchaser and Seller are prohibited
from making any claims against the other party hereto after the Closing with
respect to any breaches of the other party's representations and warranties
contained in this Agreement that the claiming party has actual knowledge of
prior to the Closing.
17. LIMITATION OF LIABILITY. Neither Seller, nor any Affiliate of Seller, nor
any of their respective beneficiaries, shareholders, partners, officers,
directors, agents or employees, heirs, successors or assigns shall have any
personal liability of any kind or nature for or by reason of any matter or
thing whatsoever under, in connection with, arising out of or in any way
related to this Agreement and the transactions contemplated herein, and
Purchaser hereby waives for itself and anyone who may claim by, through or
under Purchaser any and all rights to sue or recover on account of any such
alleged personal liability.
18. TIME OF ESSENCE. Time is of the essence of this Agreement. Time periods
of less than ten (10) days shall in the computation thereof exclude Saturdays,
Sundays and legal holidays and any time period which shall end on a Saturday,
Sunday or legal holiday shall extend to 5:00 p.m. (Chicago time) of the next
business day.
<PAGE>
19. NOTICES. Any notice or demand which either party hereto is required or
may desire to give or deliver to or make upon the other party shall be in
writing and may be personally delivered or given or made by overnight courier
such as Federal Express, by facsimile transmission or made by United States
registered or certified mail addressed as follows:
TO SELLER: c/o The Balcor Company
Bannockburn Lake Office Plaza
2355 Waukegan Road, Suite A-200
Bannockburn, Illinois 60015
Attention: Ilona Adams
with copies to: The Balcor Company
Bannockburn Lake Office Plaza
2355 Waukegan Road, Suite A-200
Bannockburn, Illinois 60015
Attention: Alan Lieberman
(847) 317-4360
(847) 317-4462 (FAX)
and to: Katten Muchin & Zavis
525 West Monroe Street
Suite 1600
Chicago, Illinois 60661-3693
Attention: Daniel J. Perlman, Esq.
(312) 902-5532
(312) 902-1061 (FAX)
TO PURCHASER: Southern Properties Fund, Inc.
2665 South Bayshore Drive
Suite 202
Miami, Grove, Florida 33133
Attention: Michael D. Wohl, President
(305) 858-9430
(305) 859-9858 (FAX)
and one copy to: Weiss Serota & Helfman, P.A.
2665 South Bayshore Drive
Suite 204
Miami, Florida 33133
Attention: Steven W. Zelkowitz, Esq.
(305) 854-0800
(305) 854-2323
subject to the right of either party to designate a different address for
itself by notice similarly given. Any notice or demand so given shall be
deemed to be delivered or made on the next business day if sent by overnight
courier, or the same day as given if sent by facsimile transmission and
received by 5:00 p.m. Chicago time or on the 4th business day after the same is
deposited in the United States Mail as registered or certified matter,
addressed as above provided, with postage thereon fully prepaid. Any such
notice, demand or document not given, delivered or made by registered or
certified mail, by overnight courier or by facsimile transmission as aforesaid
shall be deemed to be given, delivered or made upon receipt of the same by the
party to whom the same is to be given, delivered or made. Copies of all
notices shall be served upon the Escrow Agent.
<PAGE>
20. EXECUTION OF AGREEMENT AND ESCROW AGREEMENT. Purchaser will execute two
(2) copies of this Agreement and three (3) copies of the Escrow Agreement and
forward them to Seller for execution, accompanied with the Earnest Money
payable to the Escrow Agent set forth in the Escrow Agreement. Seller will
forward one (1) copy of the executed Agreement to Purchaser and will forward
the following to the Escrow Agent:
(A) Earnest Money;
(B) One (1) fully executed copy of this Agreement; and
(C) Three (3) copies of the Escrow Agreement signed by the parties with a
direction to execute two (2) copies of the Escrow Agreement and deliver a fully
executed copy to each of the Purchaser and the Seller.
21. SERVICE CONTRACTS. Attached hereto as Exhibit H is a list of service
contracts affecting the Property. Seller shall assign the service contracts to
Purchaser at Closing, and Purchaser shall assume responsibility and obligations
under the service contracts. Seller agrees not to enter into any other service
contracts affecting the Property. Seller agrees to terminate any and all
management agreements affecting the Property as of the Closing Date.
22. GOVERNING LAW. The provisions of this Agreement shall be governed by the
laws of the State of Florida, except that with respect to the retainage of the
Earnest Money as liquidated damages the laws of the State of Illinois shall
govern.
23. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement between
the parties and supersedes all other negotiations, understandings and
representations made by and between the parties and the agents, servants and
employees.
24. COUNTERPARTS. This Agreement may be executed in multiple counterparts,
each of which shall be deemed an original but all of which shall constitute one
and the same instrument.
25. SEVERABILITY. The invalidity, illegality or unenforceability of any
provision of this Agreement shall not affect or impair the validity, legality
or enforceability of the remainder of this Agreement, and to this end, the
provisions of this Agreement are deemed severable.
26. CAPTIONS. Paragraph titles or captions contained herein are inserted as a
matter of convenience and for reference, and in no way define, limit, extend or
describe the scope of this Agreement or any provision hereof.
27. RADON GAS DISCLOSURE. Radon is a naturally occurring radioactive gas
that, when it has accumulated in a building in sufficient quantities, may
present health risks to persons who are exposed to it over time. Levels of
radon that exceed federal and state guidelines have been found in buildings in
Florida. Additional information regarding radon and radon testing may be
obtained from the county public health unit. Seller makes no representation
regarding the levels of radon at the Property.
28. EFFECTIVE DATE. The Effective Date of thus Agreement shall be the date it
is last executed by a party hereto and such date shall be inserted on the first
page hereof.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have put their hand and seal as of
the date first set forth above.
PURCHASER:
SOUTHERN PROPERTIES FUND, INC., a Florida
corporation
By: /s/Michael D. Wohl
--------------------------------
Name: Michael D. Wohl
--------------------------------
Its: President
--------------------------------
SELLER:
GREENWALD PARTNERS LIMITED PARTNERSHIP, an
Illinois limited partnership
By: Greenwald Partners, Inc., an Illinois
corporation
By: /s/Daniel L. Charleston
----------------------------------
Name: Daniel L. Charleston
----------------------------------
Its: Authorized Agent
----------------------------------
<PAGE>
Walden Green Apartments, Orlando, Florida
_________________ of CB Commercial ("Seller's Broker") executed this Agreement
in its capacity as a real estate broker and acknowledges that the fee or
commission due it from Seller as a result of the transaction described in this
Agreement is as set forth in that certain Listing Agreement, dated __, 199_
between Seller and Seller's Broker (the "Listing Agreement"). Seller's Broker
also acknowledges that payment of the aforesaid fee or commission is
conditioned upon the Closing and the receipt of the Purchase Price by the
Seller. Seller's Broker agrees to deliver a receipt to the Seller at the
Closing for the fee or commission due Seller's Broker and a release, in the
appropriate form, stating that no other fees or commissions are due to it from
Seller or Purchaser.
CB COMMERCIAL
By: ________________________
Name:_______________________
Its:________________________
<PAGE>
Exhibits
A - Legal
B - Personal Property
C - Escrow Agreement
D - Title Commitment
E - Deed
F - Bill of Sale
G - Assignment and Assumption of Intangible Property
H - Service Contracts
I - Assignment and Assumption of Leases and Security Deposits
J - Non-Foreign Affidavit
K - Notice to Tenants
L - Rent Roll
<PAGE>
FIRST AMENDMENT TO AGREEMENT OF SALE
THIS FIRST AMENDMENT TO AGREEMENT OF SALE (this "Amendment") is entered
into as of the 12th day of August, 1996, by and between Olmstead Properties,
Inc., a New York corporation ("Purchaser"), 45 West 45th Street Limited
Partnership, an Illinois limited partnership ("Seller") and The Balcor Company,
a Delaware corporation.
R E C I T A L S:
A. Purchaser, Seller and Balcor have entered into that certain Agreement
of Sale dated as of July 29, 1996 ("Purchase Agreement") with respect to the
purchase and sale of 45 West 45th Street, New York, New York.
B. Purchaser, Seller and Balcor desire to amend the Purchase Agreement
on the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the mutual covenants herein contained
and other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged, Purchaser and Seller hereby agree as follows:
1. Capitalized terms used but not defined herein shall have the meanings
set forth in the Purchase Agreement.
2. In the event of any inconsistency between the terms and the
provisions of the Purchase Agreement and the terms and provisions of this
Amendment, the terms and provisions of this Amendment shall govern and control.
3. Paragraph 3A(e) of the Purchase Agreement is amended by inserting the
phrase "based on the Existing Survey" immediately after the phrase "survey
reading" and before the close parenthesis and by deleting exception number 4.
4. Notwithstanding the provisions of Section 4A of the Purchase
Agreement, Seller, rather than Purchaser, shall pay for the cost of the
documentary or transfer stamps and other costs and transfer taxes described in
said Paragraph 4A, other than charges of the Title Insurer which are to be paid
by Purchaser.
5. The Title Commitment and other due diligence materials and
investigations disclose various alleged violations with respect to the
Property.
(a) With respect to the alleged May 8, 1990 elevator violation and
June 16, 1988 ECB Violation with respect to bathroom renovations, Seller shall
either cause such violations to be remedied and discharged of record or at
Closing Purchaser shall receive a credit in the amount of $2,000 with respect
to the May 8, 1990 elevator violation and a credit in the amount of $10,000
with respect to the June 16, 1988 ECB Violation, in each case, in the event not
remedied and discharged of record.
<PAGE>
(b) Purchaser and Seller acknowledge that a current environmental
report for the property will not be available for another week to ten days.
Purchaser agrees to deliver to Seller a copy of the report in the event the
report reveals remediation for which Purchaser requests Seller to contribute to
the cost thereof. In the event the environmental report discloses
environmental conditions with respect to which the engineer recommends
remediation and which were not disclosed in the Existing Report, and the cost
to perform such remediation, as reasonably determined by Purchaser and Seller,
is not greater than $50,000, then (a) Closing shall occur as provided in the
Purchase Agreement, as amended hereby, and (b) Purchaser shall be responsible
for the first $25,000 of such costs and Seller agrees to provide to Purchaser a
credit at closing equal to the amount by which the estimated cost of
remediation exceeds $25,000, said credit not to exceed $25,000. In the event
the reasonably estimated cost to remediate conditions not disclosed in the
Existing Report exceeds $50,000, then Purchaser shall have the right either to
terminate the Agreement by written notice to Seller given no later than three
business days after Purchaser has received the new environmental report or to
acquire the Property subject to such conditions with a credit against the
Purchase Price of $25,000.
(c) Seller agrees to use its commercially reasonable efforts to
remove all other violations disclosed in writing to Seller prior to Closing
provided Seller shall not be obligated to expend any funds or incur liability
in an amount in excess of $5,000 in the aggregate in connection therewith.
(d) With respect to the Local Law 10 Filing and the Class E system
approval, Seller agrees to cause the filing to be made and approval obtained
and, subject to the following sentence with respect to the Local Law 10 Filing,
to correct any hazardous conditions identified in the filing or in the
approval. Notwithstanding the foregoing, with respect to any hazardous
condition disclosed in the Local Law 10 Filing, Seller shall not be obligated
to expend any funds or incur any liability in an amount in excess of $10,000 in
the aggregate. It shall be a condition to Purchaser's obligation to close that
the Class E system approval has been issued and delivered to Purchaser and the
Local Law 10 Filing filed (with evidence thereof furnished to Purchaser) and
all material hazardous conditions corrected.
(e) Seller's sole liability, and Purchaser's sole remedies, with
respect to the violations described above and all other violations of which
Purchaser has knowledge as of the date hereof, shall be as set forth in clauses
(a), (b), (c) and (d) above.
6. The Closing Date shall be November 12, 1996 provided Purchaser shall
have the right to extend the Closing Date to a date no later than December 12,
1996 provided Purchaser delivers to Seller written notice no later than October
26, 1996 and pays to Seller, on or before November 8, 1996, the amount of
$200,000 which shall be applied toward the Purchase Price and which amount
shall be deemed "Additional Earnest Money".
<PAGE>
7. No later than fourteen (14) days prior to the Closing Date, Seller
agrees to deliver notice of cancellation to the parties to the Service
Contracts identified on Exhibit G which are cancelable on 30 day's notice or
less and which are identified in writing by Purchaser to Seller. In addition,
Seller agrees not to enter into any new service contracts or except as provided
in the preceding sentence with respect to termination, modify any existing
service contracts, which new service contract or amendment would be binding on
Purchaser after Closing.
8. (a) Paragraph 16.B(vi) is deleted in its entirety and the following
is substituted therefor:
"Seller has not either directly or through its agents, and other third
parties, entered into any contract with any labor organization or service
provider (other than those listed on Exhibit G) regarding the Property, nor is
it permitted to do so through the Closing Date"; and
(b) Paragraph 16.B(vii) is amended by deleting the phrase "and
updated as of the Closing Date".
9. On the Closing Date, Seller shall assign to Purchaser all of Seller's
right, title and interest if any, in and to all tax certiorari proceedings and
the right to receive payment as a result thereof. Purchaser agrees to
indemnify, defend and hold Seller and all Affiliates of Seller harmless from
any and all liability, costs, and expense (including without limitation
reasonable attorney's fees, court costs and costs of appeal), suffered or
incurred by Seller or Affiliates of Seller as a result thereof, including,
without limitation, claims of current and prior tenants of the Property.
Seller agrees to cooperate, at no cost, expense or liability to Seller, with
Purchaser in connection with the tax certiorari proceedings, if any, including,
without limitation, making the books and records relating to the tax certiorari
proceedings available to the New York City Law Department should they request
an examination of the same.
10. Seller agrees to cooperate with Purchaser in Purchaser's effort to
obtain financing for the Property provided in no event shall Seller be
obligated to incur any liability or expend any funds in connection therewith.
Without limiting the generality of the foregoing, Seller agrees to cooperate in
an effort to obtain non-disturbance agreements from tenants of the Property
including, without limitation, First Dept., Leo Wolleman and Steve
Schwartzapfel. It shall not be a condition to Purchaser's obligation to close
the transaction that non-disturbance agreements are obtained.
11. This Amendment may be executed in multiple counterparts, each of
which shall be deemed an original but all of which shall constitute one and the
same instrument.
12. Exhibit K is modified to reflect that the reference to "Service
Contracts" as defined therein shall be limited to only those Service Contracts
set forth on Exhibit G which have not been cancelled on or before the Closing
Date as provided in Paragraph 7 hereof and those service contracts entered into
after the date hereof with Purchaser's consent as provided in Paragraph 7
hereof.
<PAGE>
13. Supplementing Paragraph 18 of the Purchase Agreement and without
limiting the provisions contained therein, Seller agrees to use commercially
reasonable efforts (but without any obligation to expend any funds or incur any
liability) to obtain Tenant Certificates from all of the tenants of the
Property.
14. Except as amended hereby, the Purchase Agreement remains unmodified
and in full force and effect, including, without limitation, Paragraphs 2, 7
and 10 thereof.
PURCHASER:
OLMSTEAD PROPERTIES, INC., a New York corporation
By: /s/ Samuel Rosenblatt
-------------------------------------
Name: Samuel Rosenblatt
-------------------------------------
Its: President
-------------------------------------
SELLER:
45 W. 45TH STREET LIMITED PARTNERSHIP,
an Illinois limited partnership
By: 45 W. 45TH Street Partners, Inc., an Illinois
corporation, its general partner
By: /s/ James E. Mendelson
-------------------------------------
Name: James E. Mendelson
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Its: Authorized Rep.
-------------------------------------
BALCOR:
THE BALCOR COMPANY, a Delaware corporation
By: /s/ James E. Mendelson
--------------------------------------
Name: James E. Mendelson
--------------------------------------
Its: Authorized Rep.
--------------------------------------
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