SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report under Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the quarter ended March 31, 1996 Commission file #0-13545
JMB/245 PARK AVENUE ASSOCIATES, LTD.
(Exact name of registrant as specified in its charter)
Illinois 36-3265541
(State of organization) (I.R.S. Employer Identification No.)
900 N. Michigan Ave., Chicago, Illinois 60611
(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code 312-915-1960
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes X No
TABLE OF CONTENTS
PART I FINANCIAL INFORMATION
Item 1. Financial Statements . . . . . . . . . . . . . . . 3
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations. . . . . . . . 10
PART II OTHER INFORMATION
Item 3. Defaults on Senior Securities. . . . . . . . . . . 11
Item 5. Other Information. . . . . . . . . . . . . . . . . 12
Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . 13
<TABLE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
JMB/245 PARK AVENUE ASSOCIATES, LTD.
(A LIMITED PARTNERSHIP)
BALANCE SHEETS
MARCH 31, 1996 AND DECEMBER 31, 1995
(UNAUDITED)
ASSETS
------
<CAPTION>
MARCH 31, DECEMBER 31,
1996 1995
------------- ------------
<S> <C> <C>
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . $ 6,880 4,275
------------ ------------
$ 6,880 4,275
============ ============
LIABILITIES AND PARTNERS' CAPITAL ACCOUNTS (DEFICITS)
------------------------------------------------------
Current liabilities:
Accounts payable. . . . . . . . . . . . . . . . . . . . . . . . . . . $ 44,723 62,089
Deferred interest payable to affiliate. . . . . . . . . . . . . . . . 4,263,014 3,506,301
Demand note payable to affiliate. . . . . . . . . . . . . . . . . . . 12,074,591 12,029,591
------------ ------------
Total current liabilities . . . . . . . . . . . . . . . . . . 16,382,328 15,597,981
Notes payable to affiliate - long-term. . . . . . . . . . . . . . . . . 43,236,631 43,236,631
------------ ------------
Commitments and contingencies
Total liabilities . . . . . . . . . . . . . . . . . . . . . . 59,618,959 58,834,612
Investment in unconsolidated venture, at equity . . . . . . . . . . . . 78,016,627 76,242,265
Partners' capital accounts (deficits):
General partners:
Capital contributions . . . . . . . . . . . . . . . . . . . . . . . 1,000 1,000
Cumulative cash distributions . . . . . . . . . . . . . . . . . . . (480,000) (480,000)
Cumulative net earnings (losses). . . . . . . . . . . . . . . . . . (13,266,765) (13,113,399)
------------ ------------
(13,745,765) (13,592,399)
------------ ------------
Limited partners (1,000 interests):
Capital contributions, net of offering costs. . . . . . . . . . . . 113,057,394 113,057,394
Cumulative cash distributions . . . . . . . . . . . . . . . . . . . (7,520,000) (7,520,000)
Cumulative net losses . . . . . . . . . . . . . . . . . . . . . . . (229,420,335) (227,017,597)
------------ ------------
(123,882,941) (121,480,203)
------------ ------------
Total partners' capital accounts (deficits) . . . . . . . . . (137,628,706) (135,072,602)
------------ ------------
$ 6,880 4,275
============ ============
<FN>
See accompanying notes to financial statements.
</TABLE>
<TABLE>
JMB/245 PARK AVENUE ASSOCIATES, LTD.
(A LIMITED PARTNERSHIP)
STATEMENTS OF OPERATIONS
THREE MONTHS ENDED MARCH 31, 1996 AND 1995
(UNAUDITED)
<CAPTION>
1996 1995
------------- -----------
<S> <C> <C>
Income:
Interest income . . . . . . . . . . . . . . . . . . . . . . . . . . . $ -- --
----------- ----------
Expenses:
Interest. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 756,713 784,965
Professional services . . . . . . . . . . . . . . . . . . . . . . . . 16,732 --
General and administrative. . . . . . . . . . . . . . . . . . . . . . 8,297 15,919
----------- ----------
781,742 800,884
----------- ----------
Operating earnings (loss) . . . . . . . . . . . . . . . . . . (781,742) (800,884)
Partnership's share of earnings (loss) from operations of
unconsolidated venture. . . . . . . . . . . . . . . . . . . . . . . . (1,774,362) (1,089,633)
----------- ----------
Net earnings (loss) . . . . . . . . . . . . . . . . . . . . . $(2,556,104) (1,890,517)
=========== ==========
Net earnings (loss) per limited partnership interest. . . . . $ (2,402) (1,777)
=========== ==========
<FN>
See accompanying notes to financial statements.
</TABLE>
<TABLE>
JMB/245 PARK AVENUE ASSOCIATES, LTD.
(A LIMITED PARTNERSHIP)
STATEMENTS OF CASH FLOWS
THREE MONTHS ENDED MARCH 31, 1996 AND 1995
(UNAUDITED)
<CAPTION>
1996 1995
------------ -----------
<S> <C> <C>
Cash flows from operating activities:
Net earnings (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . $(2,556,104) (1,890,517)
Items not requiring (providing) cash or cash equivalents:
Partnership's share of loss from operations of
unconsolidated venture. . . . . . . . . . . . . . . . . . . . . . . . 1,774,362 1,089,633
Changes in:
Accounts payable. . . . . . . . . . . . . . . . . . . . . . . . . . . . (17,366) 9,117
Accrued interest. . . . . . . . . . . . . . . . . . . . . . . . . . . . 756,713 260,646
------------ -----------
Net cash provided by (used in) operating activities . . . . . . . (42,395) (531,121)
------------ -----------
Cash flows from financing activities:
Bank overdraft. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -- 847,721
Principal payments on bank obligations payable. . . . . . . . . . . . . . -- (1,978,000)
Fundings of note payable to affiliate . . . . . . . . . . . . . . . . . . 45,000 1,661,400
------------ -----------
Net cash provided by (used in) financing activities . . . . . . . 45,000 531,121
------------ -----------
Net increase (decrease) in cash and cash equivalents. . . . . . . $ 2,605 --
============ ===========
Supplemental disclosure of cash flow information:
Cash paid for mortgage and other interest . . . . . . . . . . . . . . . . $ -- 524,319
============ ===========
Non-cash investing and financing activities . . . . . . . . . . . . . . . $ -- --
============ ===========
<FN>
See accompanying notes to financial statements.
</TABLE>
JMB/245 PARK AVENUE ASSOCIATES, LTD.
(A LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 1996 AND 1995
(UNAUDITED)
GENERAL
Readers of this quarterly report should refer to the Partnership's
audited financial statements for the fiscal year ended December 31, 1995,
which are included in the Partnership's 1995 Annual Report, as certain
footnote disclosures which would substantially duplicate those contained in
such audited financial statements have been omitted from this report.
The preparation of financial statements in accordance with GAAP
requires the Partnership to make estimates and assumptions that affect the
reported or disclosed amount of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements
and the reported amounts of revenues and expenses during the reporting
period. Actual results could differ from these estimates.
Statement of Financial Accounting Standards No. 121 was adopted by the
Partnership on January 1, 1996.
245 PARK
Occupancy of the office building remained at 96% during the quarter.
As previously reported and as more fully explained in the Partnership's
1995 Annual Report, over the past several years, the midtown Manhattan
market has seen increased competition primarily due to new office building
developments as well as the increased vacancy in the downtown office
buildings. The effective rental rates achieved on new leases are at
relatively reduced levels, although it appears that rental rates remained
stable in the midtown market in 1995. No rental rate increases are
expected in the near term.
The financial difficulties of the O&Y partners and their affiliates
and related issues have delayed the modification and extension of the joint
venture's mortgage loans. As previously reported, in October 1995 each of
the O&Y partners and certain other O&Y affiliates filed for bankruptcy
protection from creditors under Chapter 11 of the United States Bankruptcy
Code. The O&Y partners and these certain other O&Y affiliates are
attempting to restructure their ownership interests in various office
buildings, including their interest in the 245 Park Avenue office building,
which is expected to take the form of one or more real estate investment
trusts and related operating entities. Any such restructuring would be
subject to the approval of various creditors of the O&Y partners and other
O&Y affiliates as well as the bankruptcy court, and would likely result in
such creditors collectively obtaining control of such ownership interests.
In connection with such restructuring, the joint venture filed for
bankruptcy under Chapter 11 of the United States Bankruptcy Code in April
1996 seeking approval of a plan of reorganization by its creditors and the
partners of the joint venture, including the Partnership. Although the
Partnership has had discussions with the O&Y partners and certain creditors
concerning restructuring proposals and a reorganization of the joint
venture, a proposal for the restructuring of the O&Y partners' ownership
interests and a plan for the reorganization of the joint venture have not
been agreed upon.
The joint venture continues to pursue an extension and modification of
the mortgage loans secured by the property in the aggregate principal
amount of approximately $384,000,000 at March 31, 1996. As previously
reported, the holder of the first mortgage loan agreed to extend the
originally scheduled maturity date of the loan from October 1, 1993 until
January 1, 1994. During 1994, the joint venture negotiated a letter of
commitment with the first mortgage lender to further modify the loan for
the amount of the current outstanding principal balance plus accrued and
unpaid interest at a default rate of 18% per annum from October 1, 1993
through the loan closing date, with a new interest rate from the loan
closing date for a five-year term. The letter of commitment has expired by
its term. However, the joint venture and the lender have continued to
negotiate a modification and extension of the first mortgage loan. While
negotiations with the first mortgage lender have been taking place, the
lender has refrained from taking any actions or exercising any of its
remedies as a result of the loan maturing on January 1, 1994, and the joint
venture has continued to make monthly payments of principal and interest.
If the joint venture is successful in obtaining a loan modification that
includes an extension of the maturity date, it also expects seek a similar
extension of the maturity dates of the junior mortgage loans. To date, the
holder of the junior mortgage loans has refrained from taking any action or
exercising any of its remedies as a result of the loans maturing on October
1, 1994, an the joint venture has continued to make, and the holder of the
junior loans has continued to accept, monthly payments of interest.
Interest on the junior mortgage loans is currently accruing at default rate
ranging from 11.88% to 14% per annum. If the joint venture obtains
modifications and extensions of the mortgage loan, it is expected the
interest rates applicable to the loans during the extension period would be
no greater than that for the modified first mortgage loan. It currently
appears that the modification and extension of the mortgage loans will be
included as part of, and may depend upon the consummation of, a plan of
reorganization of the joint venture and the restructuring of the ownership
interests of the O&Y partners and other O&Y affiliates in various office
buildings. There can be no assurance that the joint venture will be able
to reach an agreement for any such modification and extension of any of its
mortgage indebtedness.
The O&Y partners have loaned 245 Park amounts aggregating $83,264,000
(net of repayments) on a cumulative basis as of March 31, 1996, which
amount includes approximately $1,480,000 (net of repayments) loaned for the
three months ended March 31, 1996 for interest accruing on these advances.
The loan from the O&Y partners currently exceed the maximum amount required
under the terms of the joint venture agreement. Under the terms of the
joint venture agreement, the Partnership is obligated to contribute to 245
Park its share (approximately 48.25%) of any operating expenses, reserve
requirements and capital expenditures, including interest on the O&Y
partners' loans, to the extent not covered by cash flow from the property
or any additional loans from the O&Y partners. The principal and any
unpaid interest on the O&Y partner loans will be due and payable on June 1,
2004, subject to earlier repayment out of available net cash flow or the
net proceeds of a refinancing, sale or other disposition of the property as
described below. The O&Y partners have also made capital contributions to
pay a portion of the costs associated with the Bear Stearns lease, for
which they are entitled to a priority distribution estimated to be
approximately $32,940,000 (including accrued interest, at 9% per annum
through March 1996, on the contributed and deferred amounts) from net
annual cash flow or sale or refinancing proceeds, as described above. In
addition, as of March 31, 1996, approximately $10,100,000 of these costs
had been financed by a non-recourse loan from an affiliate of the O&Y
partners at an interest rate not to exceed 9% per annum and $25,000,000 of
the costs had been financed by a third party lender at an interest rate of
9% per annum pursuant to the fourth mortgage loan described above. Through
March 1996, interest on such capital contributed by the O&Y partners and on
the non-recourse loan from their affiliate has accrued and has been added
to principal.
If the joint venture's efforts to extend its mortgage loans are
unsuccessful, the joint venture may not be able to maintain ownership of
the property as the lenders may seek to acquire title to the property. In
the event of such a disposition, the Partnership would then proceed to
terminate its affairs.
Even if the joint venture is successful in obtaining extensions and
modifications of its mortgage loans, the Partnership and the joint venture
will each have a substantial amount of indebtedness. If the 245 Park
Avenue building were sold and a distribution of net proceeds were made to
the Partnership after repayment of the mortgage loans and amounts owed to
the O&Y partners and their affiliates, the notes payable to JMB Realty
Corporation plus all related accrued interest must be satisfied before a
portion of the remaining proceeds, if any, would be distributable to the
Limited Partners. As a result, it is unlikely that the Limited Partners
will receive any significant portion of their original investment.
However, in the event of a sale or other disposition of the property
(including a transfer to the lenders), the Limited Partners would recognize
substantial gain for Federal income tax purposes (corresponding to all or
most of their deficit capital accounts for tax purposes).
TRANSACTIONS WITH AFFILIATES
As noted on the accompanying balance sheet, the Partnership has notes
payable and related deferred interest payable to JMB Realty Corporation, an
affiliate of the General Partners.
The Partnership, pursuant to the Partnership Agreement, is permitted
to engage in various transactions involving the Corporate General Partner
and its affiliates including the reimbursement for salaries and salary-
related expenses of its employees, certain of its officers, and other
direct expenses relating to the administration of the Partnership and the
operation of the Partnership's investments. Fees, commissions and other
expenses required to be paid by the Partnership to the General Partners and
their affiliates as of March 31, 1996 and for the three months ended March
31, 1996 and 1995 are as follows:
Unpaid at
March 31,
1996 1995 1996
------- ------ -----------
Reimbursement (at cost)
for legal services . . . . . $ 973 1,853 4,865
Reimbursement (at cost)
for accounting
services . . . . . . . . . . 1,053 3,918 9,476
Reimbursement (at cost)
for out-of-pocket
expenses . . . . . . . . . . 342 185 2,159
------- ----- ------
$ 2,368 5,956 16,500
======= ===== ======
UNCONSOLIDATED VENTURE - SUMMARY INFORMATION
Summary income statement information for 245 Park for the three months
ended March 31, 1996 and 1995 is as follows:
1996 1995
----------- ----------
Total income . . . . . . . . . . $24,769,938 24,720,550
=========== ==========
Operating loss . . . . . . . . . $(3,677,435) (2,258,308)
=========== ==========
Partnership's share
of loss. . . . . . . . . . . . $(1,774,362) (1,089,633)
=========== ==========
245 Park received $16,350,000 in lease termination fees ($17,000,000
discounted at 9% for early payment) from Creditanstalt-Bankverien. The
related revenue will be recognized in 1996 when the tenant vacates the
premises.
ADJUSTMENTS
In the opinion of the Corporate General Partner, all adjustments
(consisting solely of normal recurring adjustments) necessary for a fair
presentation (assuming the Partnership continues as a going concern) have
been made to the accompanying figures as of March 31, 1996 and for the
three months ended March 31, 1996 and 1995.
PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Reference is made to the notes to the accompanying financial
statements for additional information concerning the Partnership's
investment.
The mortgage loans secured by the 245 Park Avenue building have
matured without repayment. If 245 Park's efforts to extend any of its
mortgage loans are unsuccessful, 245 Park may not be able to maintain an
ownership interest in the property, as the mortgage lenders may seek to
acquire title to the property. In such event, the Partnership would
proceed to terminate its affairs. Accordingly, there exists substantial
doubt as to the Partnership's ability to continue as a going concern.
The Partnership's short-term liquidity is dependent upon additional
advances from JMB under the demand note discussed above. The ultimate
source of the Partnership's liquidity is dependent upon the refinancing
and/or eventual sale of the Partnership's investment property.
RESULTS OF OPERATIONS
The results of operations for the three months ended March 31, 1996 as
compared to the three months ended March 31, 1995 are primarily
attributable to the operations of the real property investment owned by 245
Park.
The increase in deferred interest payable to an affiliate and demand
note payable to an affiliate as of March 31, 1996 as compared to December
31, 1995 are due to the interest accruals on certain of the term loans and
the demand note payable to JMB.
The increase in the Partnership's share of loss from operations of
unconsolidated venture for the three months ended March 31, 1996 as
compared to the three months ended March 31, 1995 is primarily due to
increased property operating costs and mortgage interest expense accruing
at default rates in 1996. 245 Park had suspended the accrual of interest
at default rates on the first mortgage loan March 1 through July 31, 1995
according to the provisions of the refinancing commitment entered into with
the lender.
PART II. OTHER INFORMATION
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
245 Park's first mortgage loan in the approximate principal amount of
$191,550,000 had an extended maturity date of January 1, 1994. 245 Park
did not repay the principal and accrued interest on the loan at maturity,
but is currently seeking a modification and extension of the loan. Accrued
default interest is approximately $14,200,000 at March 31, 1996. The
junior mortgage loans, in the aggregate principal amount of approximately
$192,500,000, secured by the 245 Park Avenue office building matured in
October 1994 without repayment. 245 Park is also seeking modification and
extension of each of the junior mortgage loans. Accrued default interest
on these loans is approximately $15,460,000 at March 31, 1996. Reference
is made to the notes for further information concerning the mortgage loans
and efforts to obtain their modification and extension.
<TABLE>
PART II. OTHER INFORMATION
ITEM 5. OTHER INFORMATION
OCCUPANCY
The following is a listing of approximate occupancy levels by quarter for the Partnership's investment
property:
<CAPTION>
1995 1996
------------------------------------- ------------------------------
At At At At At At At At
3/31 6/30 9/30 12/31 3/31 6/30 9/30 12/31
---- ---- ---- ----- ---- ---- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C>
245 Park Avenue
New York, New York. . . . . 95% 96% 96% 96% 96%
</table.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits.
3-A. Amended and Restated Agreement of Limited Partnership of
the Partnership is hereby incorporated by reference to Exhibit 3 to the
Partnership's Form 10-K Report for December 31, 1992 (File No. 0-13545)
filed on March 19, 1993.
3-B. Amendment to the Amended and Restated Agreement of
Limited Partnership of JMB/245 Park Avenue Associates, Ltd. by and between
JMB Park Avenue, Inc. and Park Associates, L.P. dated January 1, 1994 is
hereby incorporated by reference to Exhibit 3-B to the Partnership's Form
10-Q Report for March 31, 1995 (File No. 0-13545) filed on May 11, 1995.
4-A. Second Mortgage Note and related agreements between
Canadian Imperial Bank of Commerce and 245 Park Avenue Company is hereby
incorporated by reference to Exhibit 4-A to the Partnership's Registration
Statement on Form 10 (as amended) of the Securities Exchange Act of 1934
(File No. 0-13545) filed on April 29, 1985.
4-B. Loan agreement dated June 27, 1984 between JMB/245 Park
Avenue Associates and Continental Illinois National Bank and Trust Company
of Chicago is hereby incorporated by reference to Exhibit 4-B to the
Partnership's Registration Statement on Form 10 (as amended) of the
Securities Exchange Act of 1934 (File No. 0-13545) filed on April 29, 1985.
4-C. Promissory Notes dated December 30, 1983 between JMB/245
Park Avenue Associates and Continental Illinois National Bank and Trust
Company of Chicago is hereby incorporated by reference to Exhibit 4-C to
the Partnership's Registration Statement on Form 10 (as amended) of the
Securities Exchange Act of 1934 (File No. 0-13545) filed on April 29, 1985.
4-D. $173,196,124.20 Mortgage Note dated September 28, 1983
between Aetna Life Insurance Company and O&Y Equity Corporation is hereby
incorporated by reference to Exhibit 4-D to the Partnership's Registration
Statement on Form 10 (as amended) of the Securities Exchange Act of 1934
(File No. 0-13545) filed on April 29, 1985.
4-E. $20,000,000 Mortgage Note dated September 28, 1983
between Aetna Life Insurance Company and O&Y Equity Corporation is hereby
incorporated by reference to Exhibit 4-E to the Partnership's Registration
Statement on Form 10 (as amended) of the Securities Exchange Act of 1934
(File No. 0-13545) filed on April 29, 1985.
4-F. Consolidation and Extension Agreement dated September
28, 1983 between Olympia and York Estates Company, O&Y Equity Corporation
and Aetna Life Insurance Company is hereby incorporated by reference to
Exhibit 4-F to the Partnership's Registration Statement on Form 10 (as
amended) of the Securities Exchange Act of 1934 (File No. 0-13545) filed on
April 29, 1985.
4-G. $20,000,000 refinanced Mortgage Note and Agreement dated
September 7, 1989 between Dai-Ichi Kangyo Bank and 245 Park Avenue Company
is hereby incorporated by reference to Exhibit 4-G to the Partnership's
Form 10-K Report for December 31, 1989 (File No. 0-13545) filed on March
28, 1990.
4-H. $17,000,000 Mortgage Note dated September 7, 1989
between Dai-Ichi Kangyo Bank and 245 Park Avenue Company is hereby
incorporated by reference to Exhibit 4-H to the Partnership's Form 10-K
Report for December 31, 1989 (File No. 0-13545) filed on March 28, 1990.
4-I. $4,000,000 Mortgage Note representing the $4,000,000
draw made in June 1990 is hereby incorporated by reference to Exhibit 4-I
to the Partnership's Form 10-K Report for December 31, 1989 (File No. 0-
13545) filed on March 28, 1990.
4-J. $4,000,000 Mortgage Note representing the $4,000,000
draw made in June 1991 is hereby incorporated by reference to Exhibit 4-J
to the Partnership's Form 10-K Report for December 31, 1991 (File No. 0-
13545) filed on March 27, 1992.
4-K. $17,000,000 Loan Agreement dated September 7, 1989
between 245 Park Avenue Company and Dai-Ichi Kangyo Bank is hereby
incorporated by reference to Exhibit 4-K to the Partnership's Form 10-K
Report for December 31, 1992 (File No. 0-13545) filed on March 19, 1993.
4-L. $4,000,000 Loan Agreement dated July 3, 1990 between 245
Park Avenue Company and Dai-Ichi Kangyo Bank is hereby incorporated by
reference to Exhibit 4-L to the Partnership's Form 10-K Report for December
31, 1992 (File No. 0-13545) filed on March 19, 1993.
4-M. Assignment of $147,500,000 mortgage dated September 7,
1989 between Canadian Imperial Bank of Commerce and Dai-Ichi Kangyo Bank,
Ltd. is hereby incorporated by reference to Exhibit 4-M to the
Partnership's Form 10-K Report for December 31, 1992 (File No. 0-13545)
filed on March 19, 1993.
4-N. Amended guaranty agreement dated April 15, 1991 between
JMB/245 Park Avenue Associates and Continental Bank N.A. (formerly,
Continental Illinois National Bank and Trust Company of Chicago) is hereby
incorporated by reference to Exhibit 4-N to the Partnership's Form 10-K
Report for December 31, 1992 (File No. 0-13545) filed on March 19, 1993.
4-O. $25,000,000 Guaranteed Promissory Note and related
documents dated December 31, 1993 between JMB/245 Park Avenue Associates
and Continental Bank are hereby incorporated by reference to Exhibit 4-O to
the Partnership's Form 10-K report for December 31, 1993 (File No. 0-13545)
filed on March 25, 1994.
4-P. $25,000,000 Fixed Rate Promissory Note and related
documents dated December 31, 1993 between JMB/245 Park Avenue Associates
and Continental Bank are hereby incorporated by reference to Exhibit 4-P to
the Partnership's Form 10-K report for December 31, 1993 (File No. 0-13545)
filed on March 25, 1994.
4-Q. $2,194,631.25 Interest Exchange Agreement Promissory
Note and related documents dated December 31, 1993 between JMB/245 Park
Avenue Associates and Continental Bank are hereby incorporated by reference
to Exhibit 4-Q to the Partnership's Form 10-K report for December 31, 1993
(File No. 0-13545) filed on March 25, 1994.
4-R. Subordinated Demand Note dated December 31, 1993 between
JMB/245 Park Avenue and JMB Realty Corporation is hereby incorporated by
reference to Exhibit 4-R to the Partnership's Form 10-K report for December
31, 1993 (File No. 0-13545) filed on March 25, 1994.
4-S. Letter of Commitment dated August 3, 1994 from Aetna and
245 Park Company detailing proposed terms to refinance the first mortgage
loan hereby incorporated by reference to Exhibit 4-S to the Partnership's
Form 10-K report for December 31, 1994 (File No. 0-13545) filed on March
27, 1995.
4-T. Letter Agreement dated April 6, 1995 from Aetna to 245
Park Avenue Company detailing proposed terms to refinance the first
mortgage loan is hereby incorporated by reference to the Partnership's 10-Q
Report for March 31, 1995 (File No. 0-13545) filed on May 11, 1995.
4-U. $16,042,000 Second Amended and Restated Promissory Note
and related documents dated August 1, 1995 between JMB/245 Park Avenue
Associates and JMB Realty Corporation filed on November 13, 1995.
4-V. $25,000,000 Second Amended and Restated Promissory Note
and related documents dated August 1, 1995 between JMB/245 Park Avenue
Associates and JMB Realty Corporation filed on November 13, 1995.
4-W. $2,194,631.25 Amended and Restated Promissory Note and
related documents dated August 1, 1995 between JMB/245 Park Avenue
Associates and JMB Realty Corporation filed on November 13, 1995.
4-X. Amended and Restated Demand Note dated August 1, 1995
between JMB/245 Park Avenue Associates and JMB Realty Corporation filed on
November 13, 1995.
4-Y. Fourth Amendment to Loan Documents dated August 1, 1995
between JMB/245 Park Avenue Associates, Ltd. and JMB Realty Corporation
detailing amendments to the term loans filed on November 13, 1995.
4-Z. Consent Agreement dated December 29, 1983 from JMB/245
Park Avenue Associates to Continental Illinois Bank of Chicago
(Continental) detailing the transactions for which the Partnership would
obtain Continental's consent filed on November 13, 1995.
4-AA. Third Amended and Restated Security Agreement dated
August 1, 1995 between JMB/245 Park Avenue Associates, Ltd. and JMB Realty
Corporation filed on November 13, 1995.
10-A. Acquisition documents dated December 29, 1983 relating
to the purchase by the Partnership of an interest in the American Brands
Building in New York, New York is hereby incorporated by reference to
Exhibit 10-A to the Partnership's Registration Statement on Form 10 (as
amended) of the Securities Exchange Act of 1934 (File No. 0-13545) filed on
April 29, 1985.
10-B. Agreement dated December 29, 1983 between 245 Park
Avenue Company and O&Y Management Corporation relating to the management of
the American Brands Building in New York, New York is hereby incorporated
by reference to Exhibit 10-B to the Partnership's Registration Statement on
Form 10 (as amended) of the Securities Exchange Act of 1934 (File No. 0-
13545) filed on April 29, 1985.
10-C. Lease Agreement between Olympia and York 245 Lease
Company and 245 Park Avenue Company and Bear Stearns Companies, Inc. dated
March 6, 1987 is hereby incorporated by reference to Exhibit 10-E to the
Partnership's Form 10-K Report for December 31, 1988 (File No. 0-13545)
filed on March 27, 1989.
10-D. Side letter agreement dated March 6, 1987 between
Olympia & York 245 Lease Company, 245 Park Avenue Company and JMB/245 Park
Avenue Associates, Ltd. relating to the division of economic benefits and
costs of the Bear Stearns Companies, Inc. lease is hereby incorporated by
reference to Exhibit 10-F to the Partnership's Form 10-K Report for
December 31, 1992 (File No. 0-13545) filed on March 19, 1993.
10-E. Amendment to Partnership Agreement, 245 Park Avenue
Company dated October 11, 1995 between JMB/245 Park Avenue Associates,
Ltd., O&Y Equity Company, L.P., O&Y 245 Corp., Olympia & York 245 Park
Avenue Holding Company, L.P. and 245 Corp. filed on November 13, 1995.
10-F. Consent and Agreement dated June 21, 1991 between
JMB/245 Park Avenue Associates, Ltd., 245 Park Avenue Company, Ltd., and O
& Y Equity Company, L.P. and Morgan Guarantee Trust Company of New York, a
copy of which is filed herewith.
10-G. Amended Business Certificate for Partners dated June 30,
1988 between O & Y Equity Company, L.P., Olympia & York 245 Park Avenue
Holding Company and JMB/245 Park Avenue Associates, Ltd., a copy of which
is filed herewith.
10-H. First Amendment to First Amended and Restated Agreement
of General Partnership of 245 Park Avenue Company dated December 29, 1986
between JMB/245 Park Avenue Associates, Ltd., O & Y Equity Corp., Fame
Associates, and O & Y Interests Corp., a copy of which is filed herewith.
10-I. Loan Transaction Agreement dated September 7, 1989
between O & Y Equity Company, L.P. and JMB/245 Park Avenue Associates,
Ltd., a copy of which is filed herewith.
27. Financial Data Schedule
(b) No reports on Form 8-K have been filed for the quarter
covered by this report.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Company has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
JMB/245 PARK AVENUE ASSOCIATES, LTD.
BY: JMB Park Avenue, Inc.
Corporate General Partner
By: GAILEN J. HULL
Gailen J. Hull, Vice President
Date: May 10, 1996
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following person in the capacity
and on the date indicated.
GAILEN J. HULL
Gailen J. Hull, Principal Accounting Officer
Date: May 10, 1996
</TABLE>
245 PARK - EXHIBIT 10-F.
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CONSENT AND AGREEMENT
June 21, 1991
Morgan Guaranty Trust Company
of New York
60 Wall Street
New York, New York 10260
O&Y Equity Company, L.P.
Olympia & York 245 Park Avenue
Holding Company, L.P.
O&Y (U.S.) Development Company, L.P.
O&Y Equity General Partner Corp.
Olympia & York 245 Lease Company
O&Y Management Corp.
c/o Olympia & York Companies (U.S.A.)
237 Park Avenue
New York, New York 10017
Re: 245 Park Avenue
NEW YORK, NEW YORK
Ladies and Gentlemen:
Please refer to the following:
(i) That certain agreement captioned "FIRST AMENDED AND
RESTATED AGREEMENT OF GENERAL PARTNERSHIP OF 245 PARK AVENUE COMPANY",
dated as of December 29, 1983, by and among JMB/245 Park Avenue Associates,
Ltd. ("JMB"), formerly known as JMB/245 Park Avenue Associates, O&Y Equity
Corp. ("EQUITY CORP.") and FAME Associates ("FAME"), as amended and
supplemented by (1) that certain agreement captioned "FIRST AMENDMENT TO
FIRST AMENDED AND RESTATED AGREEMENT OF GENERAL PARTNERSHIP OF 245 PARK
AVENUE COMPANY", dated as of December 29, 1986, by and among JMB, Equity
Corp., FAME, O&Y Interests Corp. ("INTERESTS CORP."), Interests Corp.
having previously succeeded to a portion of Equity Corp.'s interest in the
"Partnership" (as hereinafter defined) and O&Y Equity Company, L.P.
("EQUITY"), as successor in interest to FAME and Equity Corp. as a partner
of 245 Park Avenue Company (the "PARTNERSHIP"), (2) that certain letter
agreement dated March 6, 1987 (the "BEAR", STEARNS AGREEMENT"), by and
among Equity, Olympia & York 245 Lease Company ("LEASCO"), JMB and the
Partnership, (3) that certain instrument captioned "AMENDED BUSINESS
CERTIFICATE FOR PARTNERS", dated as of June 30, 1988, by and among Equity,
Olympia & York 245 Park Avenue Holding Company, L.P. ("HOLDING"), JMB and
Interests Corp., reflecting the succession by Holding to Interests Corp.'s
interest in the Partnership, and (4) that certain letter agreement dated
September 7, 1989 (the "DKB LETTER AGREEMENT"), by and between Equity and
JMB
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(the agreements and instrument referred to in this paragraph (i) being
herein individually and collectively referred to as the "PARTNERSHIP
AGREEMENT", the current partners of the Partnership being JMB, Equity and
Holding);
(ii) All proposed agreements and instruments evidencing and
securing a loan in the principal amount of $50,000,000 (the "DEVCO LOAN")
to be made by O&Y (U.S.) Development Company, L.P. ("DEVCO") to Equity
(individually and collectively, the "DEVCO LOAN DOCUMENTS"), said Devco
Loan Documents being more particularly described on Exhibit "A", hereunto
annexed and made a part hereof, and including, but without limitation, that
certain agreement captioned "PARTNERSHIP INTEREST PLEDGE AND SECURITY
AGREEMENT", to be dated as of June 21, 1991, between Equity, as pledgor of
its interests in the Partnership, Holding and Leasco, and Devco, as pledgee
of such interests (herein, the "DEVCO PLEDGE AGREEMENT").
(iii) All proposed agreements and instruments evidencing and
securing revolving loans in the aggregate principal amount of $160,000,000
(the "MORGAN LOAN") to be made by Morgan Guaranty Trust Company of New
York, acting for itself and on behalf of a group of lending institutions
(individually and collectively, "MORGAN") to Devco (individually and
collectively, the "MORGAN LOAN DOCUMENTS"), said Morgan Loan Documents
being more particularly described on Exhibit "B", hereunto annexed and made
a part hereof, and including, but without limitation, those certain
agreements, each captioned "PARTNERSHIP INTEREST PLEDGE AND SECURITY
AGREEMENT", each to be dated as of June 21, 1991, between, (1) under one
such agreement, Equity, as pledgor of its interests in the Partnership,
Holding and Leasco, and, (2) under the other such agreement, Holding, as
pledgor of its interest in the Partnership, and, under each agreement,
Morgan, as pledgee of such interests (individually and collectively, the
"MORGAN PLEDGE AGREEMENTS").
Equity, Holding, Devco, Morgan and their respective affiliates
(such parties being sometimes individually and collectively referred to
herein as the "SUBORDINATE PARTIES") have requested that JMB and the
Partnership consent to the execution and delivery of the Devco Pledge
Agreement and Morgan Pledge Agreements and to the pledges of Equity's and
Holding's respective interests in the Partnership contained therein
(collectively, the "PLEDGES"). Acting in accordance with the terms and
provisions of the Partnership Agreement, JMB and the Partnership hereby
consent to the execution and delivery of the Devco Pledge Agreement and the
Morgan Pledge Agreements and to the Pledges, subject, however, to the
terms, conditions and agreements hereinafter set forth:
1. The Pledges, the Devco Pledge Agreement, the Morgan Pledge
Agreements, all other Devco Loan Documents and Morgan Loan Documents and
the rights of the Subordinate Parties under or in respect of the foregoing
are and at all times shall be subject and subordinate to each and all of
the rights of JMB or the Partnership, now existing or hereafter arising,
under, pursuant to or in connection with the Partnership Agreement (JMB and
the Partnership being sometimes individually and collectively referred to
herein as the "PRIOR PARTIES"), which rights of the Prior Parties include,
but without limitation, the security interests created by, or identified
in, Section 9.3 of the Partnership Agreement. Nothing in this Consent and
Agreement or in the Devco
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Loan Documents or Morgan Loan Documents shall be construed as imposing any
obligation upon JMB, the Partnership or Continental with respect to the
performance of any of the duties or obligations evidenced or secured by the
Devco Loan Documents or the Morgan Loan Documents; and none of JMB, the
Partnership or Continental shall have any obligations or liability in
respect of the repayment of the Devco Loan Documents or the Morgan Loan
Documents. In addition, nothing herein or in the Devco Loan Documents or
the Morgan Loan Documents shall be construed as permitting any lien or
encumbrance upon any assets of the Partnership or of JMB as security for
performance of any of the duties or obligations evidenced or secured by the
Devco Loan Documents or the Morgan Loan Documents, including, but without
limitation, the repayment of the Devco Loan, the Morgan Loan any other debt
evidenced or secured thereby.
2. The Subordinate Parties acknowledge and consent to the
rights of Continental Illinois National Bank and Trust Company of Chicago
("CONTINENTAL") identified in Section 9.3 of the Partnership Agreement and,
to the extent consistent with said Section 9.3, as further described on
Exhibit "C", hereunto annexed and made a part hereof (herein, the
"CONTINENTAL RIGHTS"). The rights of the Subordinate Parties under,
pursuant to or in respect of Section 9.3 of the Partnership Agreement are
and at all times shall be subject and subordinate to the Continental
Rights. JMB represents and warrants that (i) Continental has consented to
JMB's execution and delivery of this Consent and Agreement and to the
possible transfer of Equity's and Holding's Partnership interests in
accordance herewith and that (ii) the Continental Rights represent all of
the agreements and understandings existing between JMB and Continental with
respect to the Continental Rights; and provided further, however, that the
foregoing representations and warranties shall not extend to understandings
or agreements which have no material or adverse affect on the interests of
the Subordinate Parties.
3. (a) The Subordinate Parties shall promptly (and, in any
event, within 30 days following their issuance) deliver copies of all
notices of default given under or in connection with the Devco Loan
Documents or Morgan Loan Documents to JMB and the Partnership.
(b) Without limitation upon, but in addition to, the
notification requirements set forth in (a) above, in the event that Devco
or Morgan shall seek to exercise any of their respective remedies under the
Devco Loan Documents or Morgan Loan Documents by reason of the occurrence
of default thereunder that has not been cured within the applicable cure
period, if any, thereunder (herein, and "EVENT OF DEFAULT"), then Devco or
Morgan, as appropriate, shall give JMB and the Partnership written notice
(herein, the "SPECIAL NOTICE") of (i) the occurrence of such Event of
Default (said Special Notice to specify with reasonable particularity the
circumstances giving rise to said Event of Default) and (ii) the remedies
which said party intends to pursue in respect of such Event of Default;
provided, however, that the notifying party shall not commence the exercise
of such remedies at any time
- 3 -
prior to that date which is thirty (30) days subsequent to the receipt by
JMB and the Partnership of the Special Notice. Notwithstanding the
foregoing, Devco or Morgan, as appropriate, shall not be obligated to give
the Special Notice unless and until an Event of Default shall have occurred
and such party desires to proceed with remedies against or in respect of
one or more of the Pledges (as distinguished from their proceeding with
remedies unrelated to the Pledges); provided, however, that if any of such
parties subsequently desire (by reason of such Event of Default or by
reason of any other Event of Default) to proceed with remedies against or
in respect of one or more of the Pledges, then the aforesaid requirements
for the Special Notice shall be operative. Subject to the Prior Parties
rights elsewhere set forth in this Consent and Agreement, the aforesaid 30-
day period within which Devco's or Morgan's remedies shall not be commenced
shall not apply to Devco's or Morgan's rights to receive distributions to
Equity or Holding from the Partnership.
(c) At all times following the receipt by JMB or the
Partnership of a Special Notice (or, in the event that, for any reason,
such Special Notice is not received by JMB or the Partnership, then at all
times following the commencement by Devco or Morgan of the exercise of any
of their respective remedies by reason of an Event of Default against or in
respect of one or more of the Pledges [as distinguished from their
proceeding with remedies unrelated to the Pledges],:
(i) the exclusive authority to manage the
operations and affairs of the Partnership and to make all decisions
regarding the Partnership and its business shall be vested in JMB, such
authority including, but not being limited to, the exclusive right to cause
the whole of the "Land Estates" and "Improvements" then included in the
"Business Property" to be sold at any time (subject, however, to the right
of first refusal set forth in subsection 6.2D(1) of the Partnership
Agreement) and to cause any financing or refinancing of the Business
Property; provided, however, that any such financing or refinancing of the
Business Property shall be subject to the provisions of subsection 6.2F of
the Partnership Agreement, except that JMB shall have the right to initiate
any such financing or refinancing at any time prior to, on or after April
1, 1993. As used herein, the terms "LAND ESTATES", "IMPROVEMENTS" and
"BUSINESS PROPERTY" have the meanings set forth for such terms in the
Partnership Agreement.
(ii) Either JMB or the Partnership shall have the
right to terminate the "Management Agreement" (as such term is defined in
the Partnership Agreement), with or without cause, and on not less than
five (5) business days prior written notice from JMB or the Partnership to
O&Y Management Corp. ("AGENT"), in which event (1) JMB shall thereafter
make all decisions respecting the day-to-day operation of the Business
Property, including, but not limited to, all decisions respecting leasing,
repairs and improvements, (2) JMB shall have the right to appoint an
Affiliate of JMB or of JMB Realty Corporation (including, but without
limitation, JMB Properties Company) or an unaffiliated commercial
management company as successor manager to serve under an agreement in form
and content satisfactory to JMB, (3) the Management Agreement shall be of
no further force or effect (provided,
- 4 -
however, that said termination of the Management Agreement shall not be
construed as a release of any party thereto from any liabilities or
obligations arising or accruing thereunder prior to the termination
thereof), (4) Agent shall promptly deliver to JMB or its designee all
pertinent records and management reports held or prepared by the Agent
(including, both without limitation, copies of all tenant leases, service
contracts and other agreements and correspondence in respect of the
foregoing held by Agent or which is under Agent's control), as well as
funds then held by Agent, Equity or Holding on the Partnership's behalf
(Equity and Holding agreeing to cooperate with Manager in its performance
of its obligations under this paragraph 3), (5) if requested by JMB, Agent
shall formally and promptly notify in writing every tenant, vendor,
mortgagee and other parties designated by JMB of said change in management,
(6) any receipts or correspondence, invoices or other documents received by
Agent with respect to the Business Property subsequent to the date of
termination shall be promptly remitted and delivered to JMB or its
designee, and (7) Agent shall take all reasonably requested actions and
provide all reasonably requested assistance and advice as is necessary or
appropriate to cooperate with JMB and its designees in providing for the
smooth transition of management responsibilities to JMB or its designee.
JMB and the Partnership shall have similar rights to those set forth in
this subparagraph (iii) with respect to any other agreements in effect
between the Partnership and any "Affiliates" (as such term is defined in
the Partnership Agreement) of Equity or Holding.
4. Subject to and without modification of the Prior Parties'
rights elsewhere set forth in this Consent and Agreement, unless and until
such date as of which all of the following shall have occurred: (i) JMB
and the Partnership shall have received the Special Notice, (ii) the
Management Agreement shall have been terminated pursuant to paragraph 3
above, (iii) all funds held by Agent, Equity and Holding on the
Partnership's behalf shall have been delivered to JMB or its designee and
(iv) JMB and the Partnership shall have received written notice (herein,
the "DISTRIBUTIONS NOTICE") from Devco or Morgan, as the case may be,
instructing the Partnership and JMB that distributions and loan repayments
from the Partnership not be made to Equity or Holding, neither JMB nor the
Partnership shall have any liability by reason of any distributions and
loan repayments from the Partnership being made (other than by JMB) to
Equity, Holding or their Affiliates (as opposed to such distributions or
loan repayments being made to any other party, including, but without
limitation, Devco or Morgan). Subject to and without modification of the
Prior Parties' rights elsewhere set forth in this Consent and Agreement,
from and after such time as all of the events described in clauses (i)
through (iv) of the preceding sentence shall have occurred (collectively,
the "SPECIFIED EVENTS"), the Partnership shall be entitled to make all
distributions and loan repayments to Equity, Holding or their Affiliates
directly to Devco or Morgan, regardless of any contrary claims or demands
by Equity, Holding or any other party. Prior to the occurrence of the
Specified Events, nothing herein shall be deemed to limit JMB's or the
Partnership's rights to deal solely with Equity and Holding (and their
successors and assigns as partners in the Partnership) with respect to any
matter relating to the Partnership.
- 5 -
5. JMB and the Partnership shall be entitled to act and to
rely upon any written notice, request, or other document believed by them
in good faith to have been executed by the proper party or parties, and, in
so acting and relying, neither the Partnership nor JMB shall have any duty
to investigate the genuineness, sufficiency, correctness or validity of any
such written notice, request or other document, or the identity, authority
or rights of any persons executive or depositing same.
6. None of the Partnership, JMB or any general or limited
partner of JMB shall have any personal liability hereunder except for gross
negligence or willful default hereunder (and then only to the extent of
their respective interests in the Partnership).
7. In the event of any disagreement among, or between any of,
Equity, Holding, Devco and Morgan resulting in adverse claims or demands
being made upon the Prior Parties in connection with the subject matter of
this Consent and Agreement, or in the event that any of the Prior Parties
shall be in doubt as to what action it or they should take hereunder, any
of the Prior Parties may, at its option, refuse to comply with any claims,
requests, or demands made upon it, or refuse to take any other action
hereunder, so long as such disagreement continues or such doubt exists, and
in any such event, none of the Prior Parties shall be or become liable in
any way or to any person for its failure or refusal so to act, and the
Prior Parties shall be entitled to continue so to refrain from acting until
(a) the rights of all parties shall have been fully and finally adjudicated
in a court of competent jurisdiction, or (b) all differences shall have
been adjusted and all doubt resolved by written agreement among all the
interested persons, and the Prior Parties shall have been notified thereof
in writing by all such persons. In the event the Prior Parties are
apprised of the existence of any pending or threatened litigation or
dispute among Equity, Holding, Devco and Morgan, or among any of them,
relating to distributions from or other payments of monies by the
Partnership or to the Pledges, then the Prior Parties may: (a) deposit any
and all sums then or thereafter distributable or payable to Equity, Holding
or their Affiliates under the Partnership Agreement with the clerk of the
court in which the litigation is pending; and/or (b) commence an action for
an interpleader.
8. In the event that Devco or Morgan forecloses upon or
otherwise proceeds against the Pledges, in whole or in part, or desires to
accept an assignment of a pledged interest (in whole or in part) in lieu of
foreclosure or such other proceeding, then prior to Devco's or Morgan's
consummating such foreclosure or such other proceedings or accepting such
other assignment, Devco or Morgan, as the case may be, shall give each of
the Prior Parties notice of such assignment, foreclosure or other
proceedings, as the same may be adjourned or re-scheduled from time to
time. Notwithstanding the foregoing:
(a) JMB's rights of first refusal set forth in Section
7.3B of the Partnership Agreement shall be applicable to any whole or
partial transfer of the Partnership interests subject to the Pledges,
whether by foreclosure, assignment in lieu of foreclosure, or otherwise, to
any party other than Devco or Morgan.
- 6 -
(b) In the event that Devco or Morgan desires to acquire,
in whole or in part, ownership of any of the Partnership interests which
are subject to the Pledges, whether by foreclosure, assignment in lieu of
foreclosure or otherwise, then Devco or Morgan, as appropriate, shall give
JMB and the Partnership no less than ninety (90) days prior written notice
of the date on which Devco or Morgan, as appropriate, shall acquire such
interest and, at any time prior to the expiration of such ninety (90) day
period, in lieu of Devco or Morgan acquiring such interest, JMB shall have
the right to acquire all of the Partnership interests which are subject to
the Pledges for a cash consideration equal to the then fair market value of
the Partnership interests which are subject to the Pledges (with said fair
market value to be determined by averaging the closest two of three
appraisals to be made by three independent, unaffiliated appraisers, with
one such appraiser to be selected by JMB, one such appraisers to be
selected by Morgan and the other to be selected by the appraisers chosen by
JMB and Morgan [and with said 90-day period to be extended, as necessary or
reasonably appropriate, in order for said appraisers to be selected and to
complete said appraisals and for an orderly closing to proceed
thereafter]). JMB shall pay the costs of the appraiser selected by it,
Morgan shall pay the costs of the appraiser selected by it and JMB and
Morgan shall split the cost of the third appraiser. In the event that JMB
acquires the pledged Partnership interests pursuant to this subparagraph
(b), then the same shall be assigned to JMB at closing free and clear of
the Pledges and of all other liens, claims and encumbrances other than
those in favor of JMB and the Partnership pursuant to Section 9.3 of the
Partnership Agreement and the Continental Rights. Notwithstanding the
foregoing, JMB acknowledges and agrees that, during the aforesaid 90-day
period, as the same may be extended in accordance with the foregoing, Devco
or Morgan may take title to the Partnership interests which JMB has the
right to acquire under this subparagraph 8(b); and in the event Devco or
Morgan shall acquire such Partnership interests, then JMB's rights shall be
to acquire such Partnership interests from Devco or Morgan pursuant to and
in accordance with the provisions of this subparagraph 8(b).
9. Nothing herein will entitle Devco, Morgan or any party
succeeding to their respective interests in and to the Partnership
interests which are subject to the Pledges to have any greater right or
interest in and to the Partnership than Equity's or Holding's rights,
subject to the terms of the Partnership Agreement, as a general partner of
the Partnership. In that connection, the Partnership interests subject to
the Pledges shall, following any such transfer, remain subject to all of
the Prior Parties' rights under, pursuant to or in connection with this
Consent and Agreement and the Partnership Agreement, including, but without
limitation, JMB's and the Partnership's rights under Section 9.3 of the
Partnership Agreement and the Continental Rights. Nothing in this Consent
and Agreement or in any of the Devco Loan Documents or Morgan Loan
Documents shall be construed as modifying, or requiring the modification
of, any existing contractual obligations of the Partnership with any "THIRD
PARTIES" (which means, individually and collectively, all parties who are
not Prior Parties, Subordinate Parties, Continental or Affiliates).
- 7 -
10. By their acceptance hereof, Holding, Equity, Devco and
Morgan each agree to execute such further documents as may from time to
time be reasonably requested by the Prior Parties or Continental in order
to evidence or effectuate the terms and provisions hereof (such further
documents to include, without limitation, any instrument, statements or
certificates in recordable form that evidence the fact that Devco's and
Morgan's collateral interests in the Partnership interests subject to the
Pledges are subject and subordinate to the collateral interests in such
interests held by the Prior Parties.
11. Except as provided herein, nothing herein shall be deemed
to modify or amend any of the terms, provisions or conditions of the
Partnership Agreement or any other agreement executed in connection
therewith and the terms and provisions of all such agreements, as affected
hereby, are hereby deemed ratified and confirmed in their entirety. In the
event of any conflict or inconsistency between the terms and provisions of
this Consent and Agreement and those of the Partnership Agreement or of the
Devco Loan Documents or Morgan Loan Documents, the terms and provisions of
this Consent and Agreement shall prevail.
12. This Consent and Agreement and the terms and provisions
hereof shall inure to the benefit of, and shall be binding upon, the
successors and assigns of the parties hereto including, but without
limitation, in the case of JMB, Continental and its nominees, successors
and assigns. The parties acknowledge that all rights of the Prior Parties
in this Consent and Agreement shall inure to the benefit of, and may be
exercised by, Continental, its nominees, successors and assigns.
References herein to "Devco" and "Morgan", respectively, shall include
their respective successors and assigns as holders (in whole or in part) of
the lenders' interests under the Devco Documents and Morgan Loan Documents,
respectively.
13. Any notice required hereunder or given pursuant hereto to
the Partnership or JMB shall be given to the Partnership and JMB at 900
North Michigan Avenue, Chicago, Illinois 60611-1575, Attention: Messrs.
Stuart Nathan and Robert Chapman (with copy to Pircher, Nichols & Meeks,
1999 Avenue of the Stars, Los Angeles, California 90067, Attention: Real
Estate Notices), and no such notice shall be deemed given to JMB or the
Partnership unless and until the same is addressed as aforesaid and
delivered to such addresses by certified mail, postage prepaid, return
receipt requested, subject, however, to the right of JMB to designate
different addresses or notice parties from time to time for notice to be
delivered to it and the Partnership.
14. JMB's and the Partnership's consents contained herein and
their other respective obligations under this Consent and Agreement are
subject to and conditioned upon Holding, Equity and Devco obtaining all
consents and approvals required for this Consent and Agreement and for the
transactions evidenced and secured by the Devco Loan Documents and the
Morgan Loan Documents from all obligees of the Partnership, including, but
without limitation, all mortgagees of the Partnership. Holding, Equity and
Devco hereby jointly and severally represent and warrant to JMB and the
Partnership that all such required consents and approvals, if any, have
been obtained and
- 8 -
at Holding's, Equity's and Devco's sole cost and expense (for which none of
such parties shall be entitled to any contribution or reimbursement from
JMB or the Partnership). Without limitation upon the foregoing, but in
addition thereto, none of JMB or the Partnership shall be obligated to make
any contribution or reimbursement to Devco, Holding or Equity in connection
with any costs or expenses incurred by them, respectively, in connection
with or pursuant to this Consent and Agreement (including, but without
limitation, paragraphs 15 and 20 below), the Devco Loan Documents, the
Morgan Loan Documents or any of the transactions contemplated herein or
therein and no such costs or expenses shall be deemed to be capital
contributions (in whole or in part) to the Partnership.
15. Concurrently with the execution and delivery hereof,
Holding, Equity and Devco, at their sole cost and expense, are causing to
be paid directly to Pircher, Nichols & Meeks, the aggregate sum of
$43,126.29, representing legal fees and disbursements of Pircher, Nichols &
Meeks for work performed by such firm on JMB's behalf in connection with
the preparation of this Consent and Agreement and for certain other
representation of JMB in connection with Partnership matters. In addition,
within five business days following the execution and delivery of this
Consent and Agreement, Equity shall, at its sole cost and expense, cause to
be paid directly to Messrs. Mayer, Brown & Platt, the aggregate sum of
$1,000.00, representing legal fees and disbursements of such firm for work
performed by such firm on Continental's behalf in connection with the
preparation of this Consent and Agreement.
16. The Subordinate Parties hereby jointly and severally
represent and warrant to JMB, the Partnership and Continental that the
Devco Loan Documents and the Morgan Loan Documents, when executed and
delivered, will represent all of the agreements and understandings existing
among such parties with respect to the Devco Loan and Morgan Loan,
respectively, and that there are not, and, except as contemplated below,
will not be, any agreements or understandings among any of such Parties
with respect to the Devco Loan or the Morgan Loan, except for this Consent
and Agreement and as described on Exhibits "A" and "B" to this Consent and
Agreement; provided, however, that the foregoing representations and
warranties shall not extend to consents or estoppels from Third Parties,
where such consents or estoppels do not relate to the Partnership or its
assets; and provided further, however, that the foregoing representations
and warranties shall not extend to understandings or agreements which have
no material or adverse affect on the interests of the Prior Parties or of
Continental. The Subordinate Parties covenant and agree that no
modifications or amendments having a material or adverse affect on the
interests of JMB or the Partnership or Continental shall be made to any of
the Devco Loan Documents or Morgan Loan Documents without the prior written
consent of the Partnership, JMB and Continental, which consent may be
granted or withheld by the Partnership, JMB or Continental in their
respective sole and absolute discretion; provided, however, that (i) such
consent shall not be unreasonably withheld, delayed or denied so long as
such modifications or amendments are not adverse to the interests of JMB,
the Partnership or Continental, and (ii) the prior written consent of the
Partnership, JMB and Continental shall not be required for modifications or
amendments that are material and beneficial to
- 9 -
the interests of JMB, the Partnership and Continental (but copies of any
such modifications or amendments shall be provided to JMB and the
Partnership prior to their execution and delivery by the parties thereto).
Notwithstanding the foregoing, in no event shall any modifications or
amendments to the Devco Loan Documents or Morgan Loan Documents be entered
into which purport to impose any obligation upon JMB, the Partnership, the
Partnership's assets or Continental with respect to the performance of any
of the duties or obligations evidenced or secured thereby or by the other
Devco Loan Documents or Morgan Loan Documents. For purposes hereof, a
modification or amendment to the Devco Loan Documents or Morgan Loan
Documents having a material or adverse affect on the interests of JMB, the
Partnership or Continental would include, without limitation, any
modification or amendment resulting in an increase in the principal amount
of the Devco Loan or Morgan Loan or modifying the interest rate, maturity
date or other terms for repayment of the Devco Loan or Morgan Loan or
modifying the "245 Release Payment" (as such term is defined in the Morgan
Loan Documents) or increasing the proportion of the total Morgan Loan or
Devco Loan which the 245 Release Payment represents.
17. The Subordinate Parties agree that all "Net Financing
Proceeds" (as such term is defined in the Partnership Agreement) hereafter
distributed to Equity and Holding and all repayments of loans (including
all principal and interest thereon) hereafter made by the Partnership to
Equity, Holding or their Affiliates shall be first applied by them in
repayment of a sufficient portion of the Morgan Loan to obtain a release of
the Partnership interests Pledges securing same in accordance with the
requirements of the Morgan Loan Documents.
18. All references in the Partnership Agreement to
predecessors in interest to Equity and Holding shall be deemed to refer to
Equity and Holding at all times from and after their respective
acquisitions of such predecessors' interests.
19. At all times prior to the termination of the Pledges, JMB
and the Partnership shall have the right to deal solely with Morgan
Guaranty Trust Company of New York, acting on behalf of all participants in
the Morgan Loan, in respect of all matters arising under, pursuant to or in
connection with this Consent and Agreement; and Morgan Guaranty Trust
Company of New York hereby represents and warrants that it has and shall,
at all times prior to the termination of the Pledges, have the sole and
exclusive authority to deal with JMB and the Partnership on behalf of
itself and all of the Participants in the Morgan Loan in respect of all
matters arising under, pursuant to or in connection with this Consent and
Agreement.
20. Equity, Holding and Devco hereby jointly and severally
covenant and agree to indemnify and hold JMB, the Partnership and
Continental harmless from and against all expenses (including, but without
limitation, legal fees), costs, losses, liabilities or damages incurred by
or asserted against JMB, the Partnership or Continental (i) in connection
with any dispute arising among Equity, Holding, Devco and Morgan, or a
among any of them, under, pursuant to or in connection with this Consent
and Agreement, the Devco Loan Documents or the Morgan Loan Documents or
(ii) in connection with any "TAX MATTER". As used
- 10 -
herein, means, "TAX MATTER" individually and collectively, (1) any
transfer, gains or other tax (including, but without limitation, any
federal, state or local income tax) resulting from or relating to (i) the
transactions contemplated by the Devco Loan Documents or Morgan Loan
Documents or from any exercise of rights or remedies afforded thereunder
(including, but without limitation, foreclosure of the Pledges) or (ii)
JMB's or its Affiliate's exercise of its rights or remedies under paragraph
8 above, and (2) any increase in real property tax assessments for the
Business Property or any portion thereof resulting from or relating to (i)
the transactions contemplated by the Devco Loan Documents or Morgan Loan
Documents or from any exercise of rights or remedies afforded thereunder
(including, but without limitation, foreclosure of the Pledges) or (ii)
JMB's or its Affiliate's exercise of its rights or remedies under paragraph
8 above. Any amounts owing to JMB or its Affiliate under this paragraph 20
may, at JMB's or its Affiliate's election, be offset and credited against
the purchase price for any Partnership interests acquired by JMB or its
Affiliate pursuant to paragraph 8 above.
21. All covenants and agreements of Equity, Holding and Devco,
respectively, set forth in this Consent and Agreement, including, but
without limitation, the indemnification obligations set forth in paragraph
20 above, shall be secured by Equity's and Holding's pledges of their
respective interests in the Partnership to JMB and the Partnership set
forth in Section 9.3 of the Partnership Agreement, which pledges, as more
particularly set forth above, are prior and superior to all rights of Devco
and Morgan, respectively, under the Devco Loan Documents and Morgan Loan
Documents.
22. JMB's rights under paragraph 8 above shall not be
applicable to transfers of Partnership interests by Equity or Holding to
Affiliates thereof, where such transfers are permitted without the
requirement of JMB's consent under the Partnership Agreement and where such
transfers do not entitle JMB to the rights of first refusal thereon set
forth in Section 7.3B of the Partnership Agreement; provided, however, that
the Subordinate Parties covenant and agree that no such transfers to
Affiliates shall be made with the principal purpose of circumventing JMB's
rights under said paragraph 8 above and any such Affiliate transferees of
Partnership interests by Equity or Holding shall remain subject to JMB's
rights under said paragraph 8. JMB shall have the right from time to time
to assign one or more of its rights under paragraph 8 above to one or more
Affiliates of JMB.
23. The parties acknowledge that references to Devco in
paragraphs 3, 7 and 8 of this Consent and Agreement shall not be construed
as implying that Devco has any rights to enforce obligations under the
Devco Loan Documents independently of Morgan, to the extent that Devco has
assigned such rights to Morgan; provided, however, that nothing in this
paragraph 23 shall
- 11 -
be construed as limiting the Prior Parties' rights set forth in said
paragraphs 3, 7 or 8 above.
24. The parties acknowledge that this Consent and Agreement shall
not be modified or amended without the prior written consent of
Continental.
Please indicate your consent to the terms and provisions of
this Consent and Agreement by executing this Consent and Agreement in the
space provided below.
Very truly yours,
JMB/245 PARK AVENUE ASSOCIATES, LTD.
By: JMB PARK AVENUE, INC.
general partner
By:
Title:
245 PARK AVENUE COMPANY
By: JMB/245 PARK AVENUE ASSOCIATES, LTD.
BY: JMB PARK AVENUE, INC.
general partner
By:
Title:
By: O&Y EQUITY COMPANY, L.P.
By: O&Y EQUITY GENERAL PARTNER CORP.,
general partner
By:
Title: Executive Vice President
ACCEPTED AND AGREED TO AS OF THE DATE
FIRST ABOVE WRITTEN:
MORGAN GUARANTY TRUST COMPANY
OF NEW YORK
By:
Title: Executive Vice President
- 12 -<PAGE>
O&Y (U.S.) DEVELOPMENT COMPANY, L.P.
By: O&Y (U.S.) DEVELOPMENT GENERAL
PARTNER CORP., general partner
By:
Title: Executive Vice President
By: O&Y Equity Company, L.P.,
general partner
O&Y EQUITY COMPANY, L.P.
By: O&Y EQUITY GENERAL PARTNER CORP.
general partner
By:
Title: Executive Vice President
OLYMPIA & YORK 245 PARK AVENUE HOLDING
COMPANY, L.P.
By: O&Y EQUITY COMPANY, L.P.,
general partner
By: O&Y EQUITY GENERAL PARTNER CORP.,
general partner
By:
Title: Executive Vice President
OLYMPIA & YORK 245 LEASE COMPANY
By: O&Y EQUITY COMPANY, L.P.,
general partner
By: O&Y EQUITY GENERAL PARTNER CORP.,
general partner
By:
Title: Executive Vice President
O&Y MANAGEMENT CORP.
By:
Title: Executive Vice President
O&Y EQUITY GENERAL PARTNER CORP.
By:
Title: Executive Vice President
- 13 -<PAGE>
EXHIBIT A
Devco Loan Documents
1. $50,000,000 Note made by O&Y Equity Company, L.P. payable to O&Y
(U.S.) Development Company, L.P.
2. Partnership Interest Pledge and Security Agreement between Equity Co.
and Devco, in connection with the pledge by Equity Co. of its
interest in (x) 245 Co., (y) 245 Holding and (z) 245 Lease.
3. With respect to item 2 above, two UCC-1 Financing Statements naming
Equity Co., as debtor, and the Devco, as secured party, one to be-
filed with the New York Secretary of State and one to be filed in New
York County.
<PAGE>
EXHIBIT B
Morgan Loan Documents
As used in this Exhibit B, the names of the following parties
have been abbreviated as follows:
PARTY ABBREVIATION
BHF - Bank; Bank of Montreal; The
Sumitomo Trust & Banking Company,
Limited; Westdeutsche Landesbank;
Banco di Roma; Manufacturers
Hanover Trust Company; Morgan
Guaranty Trust Company of New York;
and Svenska Handelsbank the Banks
Morgan Guaranty Trust Company of
New York, as agent for the Banks the Agent
O&Y (U.S.) Development Company, L.P. Devco
Olympia & York (U.S.) Holdings Company US Holding
Olympia & York 245 Park Avenue
Holding Company, L.P. 245 Holding
O&Y Equity Company, L.P. Equity Co.
O&Y Equity General Partner Corp. Equityco GP-US
Olympia & York Real Estate (USA) Inc. Real Estate
O&Y (U.S.) Development General
Partner Corp. Devco GP-US
O&Y (U.S.) Financial Company Financial Co.
245 Park Avenue Company 245 Co.
Olympia & York 245 Lease Company 245 Lease
Olympia & York Tower B Company Tower B Company
Olympia & York Tower B Lease Company Tower B Lease
WFC Tower A Company WFC
Olympia & York Maiden Lane Company Maiden Company
11601 Wilshire Associates 11601 Associates
<PAGE>
Olympia & York/O' M&M Associates O' M&M Associates
Devco 11601-A, L.P. 11601-A
Devco 11601-B, L.P. 11601-B
Tower A Limited Partnership Tower A
O&Y Tower A Holding Company Tower A Holding
O&Y Tower B Holding Company I Tower B Holding-I
DOCUMENTS
1. Revolving Credit Agreement among Devco, the Banks and the Agent.
2. The following promissory notes made by Devco to the Banks in the
original principal amounts as set forth below:
a. BHF - Bank $20,000,000
b. Bank of Montreal $50,000,000
c. The Sumitomo Trust &
Banking Company, Limited $20,000,000
d. Westdeutsche Landesbank $20,000,000
e. Banco di Roma $10,000,000
f. Manufacturers Hanover
Trust Company $10,000,000
g. Morgan Guaranty Trust
Company of New York $20,000,000
h. Svenska Handelsbank $10,000,000
3. Partnership Interest Pledge and Security Agreement between Equity
Co., and the Agent, in connection with the pledge by Equity Co. of
its interest in (x) 245 Co., (y) 245 Holding and (z) 245 Lease.
4. Partnership Interest Pledge and Security Agreement between Equityco
GP-US and the Agent, in connection with the pledge by Equityco GP-US
of its interest in (x) 245 Holding and (y) 245 Lease.
<PAGE>
5. Partnership Interest Pledge and Security Agreement between 245
Holding and the Agent, in connection with the pledge by 245 Holding
of its interest in 245 Co.
6. Partnership Interest Pledge and Security Agreement between Devco and
the Agent, in connection with the pledge by Devco of its interest in
(x) WFC and (y) Tower A Holding.
7. Partnership Interest Pledge and Security Agreement between Devco GP-
US and the Agent, in connection by the pledge by Devco GP-US of its
interest in Tower A Holding.
8. Partnership Interest Pledge and Security Agreement between Real
Estate and the Agent, in connection with the pledge by Real Estate of
its interest in Tower A.
9. Partnership Interest Pledge and Security Agreement between Devco and
the Agent, in connection with the pledge by Devco of its interest in
(x) Tower B Lease and (y) Tower B Holding-I.
10. Partnership Interest Pledge and Security Agreement between Devco GP-
US and the Agent, in connection with the pledge by Devco GP-US of its
interest in (x) Tower B Company, (y) Tower B Holding-I and (z) Tower
B Lease.
11. Partnership Interest Pledge and Security Agreement between Devco and
the Agent, in connection with the pledge by Devco of its interest in
Maiden Company.
12. Partnership Interest Pledge and Security Agreement between Devco GP-
US and the Agent, in connection with the pledge by Devco GP-US of its
interest in Maiden Company.
13. Partnership Interest Pledge and Security Agreement between Devco and
the Agent, in connection with the pledge by Devco of its limited
partnership interest in (x) 11601-A and (y) 11601-B.
14. Partnership Interest Pledge and Security Agreement between Devco GP-
US and the Agent, in connection with the pledge by Devco GP-US of its
limited partnership interest in (x) 11601-A and (y) 11601-B.
15. Partnership Interest Pledge and Security Agreement between Devco and
the Agent, in connection with the pledge by Devco of its interest in
O' M&M Associates.
16. Note Pledge and Security Agreement between Real Estate and Financial
Co. and the Agent, in connection with the Pledge by Real Estate and
Financial Co. of certain promissory notes described therein which
were made by Tower A Associates to Real Estate and Financial Co. (the
"Tower A Notes").
<PAGE>
17. Swap Pledge and Security Agreement between Equity Co. and the Agent,
in connection with the pledge by Devco of its right, title and
interest in the Interest Rate Swap Agreement between The Dai-Ichi
Kangyo Bank, Limited, New York Branch and Devco.
18. Swap Pledge and Security Agreement between Devco and the Agent in
connection with the pledge by Devco of all its right, title and
interest the Swap Confirmation between Citibank, N.A. and Devco.
19. Note Pledge and Security Agreement between Devco and the Agent, in
connection with the pledge by Devco of the promissory note described
therein which was made by Equity Co. to Devco (the "Equity Co.
Note").
20. With respect to each of the items numbered 3 through 19 above, two
UCC-1 Financing Statements naming the various pledgors, as debtor,
and the Agent, as secured party, one to be filed with the New York
Secretary of State and one to be filed in New York County.
21. Assignment by Real Estate and Financial Co. of all Form UCC-1
financing statement executed by Tower A Associates naming Tower A
Associates as debtor and Real Estate and Financial Co. as secured
parties in connection with the Amended and Restated Security
Agreement, dated as of July 31, 1987, among Tower A Associates, Real
Estate and Financial Co., under which the general and limited
partnership interests in Tower A have been pledged to secure the
Tower A Notes.
22. Assignment by Devco of all Form UCC-1 financing statements executed
by Equity Co. naming Equity Co. as debtor and Devco as secured party
in connection with the Partnership Interest Pledge and Security
Agreement between Devco and Equity Co., under which Equity Co.'s
general and limited partnership interests in 245 Holding and its
general partnership interests in 245 Lease and 245 Co. have been
pledged to secure the Equity Co. Note.
23. Guaranty by US Holdings in favor of the Agent.
24. Agency and Intercreditor Agreement among Devco, the Agent and the
Banks.
25. Agreement between Devco and the Agent regarding subordination of
management fees payable with respect to One World Financial Center.
26. Agreement between Devco and the Agent regarding subordination of
management fees payable with respect to Two World Financial Center.
<PAGE>
27. Agreement between O&Y Management Corp. and the Agent regarding
subordination of management fees payable with respect to 245 Park
Avenue.
28. Agreement between Devco, d/b/a O&Y Hope Street Management Company,
and the regarding subordination of management fees payable with
respect to 400 South Hope Street.
29. Lost Note Affidavit and Indemnity made by Real Estate in favor of the
Agent.
30. Lost Note Affidavit and Indemnity made by Financial Co. in favor of
the Agent.
31. Estoppel from the Bear Stearns Companies Inc.
31. Estoppel from Aetna Life Insurance Company.
33. Estoppel from The Dai-Ichi Kangyo Bank, Limited, New York Branch.
<PAGE>
EXHIBIT "C"
All rights of Continental pursuant to, under, and in connection with
the following document, to the extent consistent with Section 9.3 of the
Partnership Agreement:
1. Promissory Note, dated as of December 29, 1983, made by JMB to
Continental, in the principal amount of $35,000,000.
2. First Amended and Restated Security Agreement, dated as of December
29, 1983, between JMB and Continental, relating to the $35,000,000 loan.
3. Guaranty of Payment, dated as of December 29, 1983, from JMB Realty
Corporation, Judd D. Malkin, Neil G. Bluhm, and The 1975 Judd D. Malkin
Life Insurance Trust, as guarantors, to Continental, relating to the
$35,000,000 loan.
4. Guaranty of Interest, dated as of December 29, 1983, from JMB Realty
Corporation, Judd D. Malkin, Neil G. Bluhm, and The 1975 Judd D. Malkin
Life Insurance Trust, as guarantors, to Continental, relating to the
$35,000,000 loan.
5. Side Letter, dated December 29, 1983, from Continental to JMB Realty
Corporation, Judd D. Malkin, Neil G. Bluhm, and The 1975 Judd D. Malkin
Life Insurance Trust, relating to the $35,000,000 loan.
6. Promissory Note, dated as of December 29, 1983 made by JMB to
Continental, in the principal amount of $15,000,000.
7. First Amended and Restated Security Agreement, dated as December 29,
1983, between JMB and Continental, relating to the $15,000,000 loan.
8. Guaranty of Payment, dated as of December 29, 1983, from JMB Realty
Corporation, Judd D. Malkin, Neil G. Bluhm, and The 1975 Judd D. Malkin
Life Insurance Trust, as guarantors, to Continental, relating to the
$15,000,000 loan.
9. Promissory Note, dated as of December 29, 1983, made by JMB to
Continental, in the principal amount of $13,000,000.
10. First Amended and Restated Security Agreement, dated as of December
29, 1983, between JMB and Continental, relating to the $13,000,000 loan.
11. Guaranty of Payment, dated as of December 29, 1983 from JMB Realty
Corporation, as guarantor, to Continental, relating to the $13,000,000
loan.
12. Side Letter, dated December 29, 1983, between JMB and Continental,
relating to the $13,000,000 loan.
13. Consent Agreement, dated December 29, 1983, between JMB and
Continental, relating to the $35,000,000 loan, $15,000,000 loan and
$13,000,000 loan.
14. First Amendment to Notes, Loan Documents and Guaranties, dated as of
February 29, 1984, among JMB, as borrower, JMB Realty Corporation, Judd D.
Malkin, Neil G. Bluhm, and The 1975 Judd D. Malkin Life Insurance Trust, as
guarantors, and Continental.
<PAGE>
15. Second Amendment to $15,000,000 Loan Documents and $35,000,000 Loan
Documents and First Amendment to $13,000,000 Loan Documents and Restated
Security Agreement, dated July 10, 1984, among JMB, as borrower, JMB Realty
Corporation, Judd D. Malkin, Neil G. Bluhm, and The 1975 Judd D. Malkin
Life Insurance Trust, as guarantors, and Continental.
16. Guaranty of Payment, dated as of April 15, 1991, from JMB Realty
Corporation to Continental.
17. Side Letter, dated as of April 15, 1991, between JMB Continental.
18. Certification re Indebtedness, dated as of April 15, 1991, between
JMB and Continental.
19. Side Letter dated as of April 15, 1991, from Continental to JMB
regarding waiver of defaults.
245 PARK
EXHIBIT 10-G.
- -------------
AMENDED
BUSINESS CERTIFICATE FOR PARTNERS
The undersigned hereby certify that a certificate of doing
business under the assumed name Olympia & York Estates Company for the
conduct of business at 245 Park Avenue, New York, New York was filed in the
office of the County Clerk, New York County, State of New York, on the 21st
day of December, 1979 under index number 8585/79B. Amended certificates
were filed in the office of the County Clerk, New York County, State of New
York, on the 16th day of January, 1980, the 12th day of August, 1981, the
6th day of October, 1981 and the 23rd day of November, 1982, in each case
under index number 8585/79B. The last amended certificate was filed in the
office of the County Clerk, New York County, State of New York on the 17th
day of January, 1984 under index number 8585/79B reflecting, among other
things, a change of assumed name to 245 Park Avenue Company.
It is hereby further certified that a certificate of doing
business under the assumed name Olympia & York 245 Park Avenue Company was
filed in the office of the County Clerk, New York County, State of New
York, on the 26th day of June, 1987 under index number 4748-87 and that
such filing was in error as the parties thereto intended to amend the
certificate of Olympia & York Estates Company and thereby continue doing
business under the assumed name 245 Park
<PAGE>
Avenue Company rather than to do business under the assumed name Olympia &
York 245 Park Avenue Company. It is hereby further certified that a
Certificate of Discontinuance of Business under the assumed name Olympia &
York 245 Park Avenue Company is being filed in the office of the County
Clerk, New York County, State of New York to correct this error.
It is hereby further certified that this Amended Certificate is
made for the purpose of more accurately setting forth the facts recited in
the original certificate and to set forth the following change in such
facts:
(1) As of January 31, 1987, O&Y Equity Corp. contributed its
general partnership interest in 245 Park Avenue Company
to O&Y Equity Company, L.P. and Fame Associates sold its
general partnership interesting 245 Park Avenue Company
to O&Y Equity Company, L.P., as a result of the
foregoing, O&Y Equity Company, L.P., Olympia & York
Interests Corp. and JMB/245 Park Avenue Associates, Ltd.
were conducting business as members of a partnership
under the name of designation as 245 Park Avenue Company.
(2) On June 30, 1988, Olympia & York Interests Corp.
transferred its entire general partnership interest in
245 Park Avenue Company to Olympia & York 245 Park Avenue
Holding Company, L.P. and Olympia & York 245 Park Avenue
Holding Company L.P. was substituted for Olympia & York
Interests Corp. as a general partner in 245 Park Avenue
Company.
2
(3) As a result of the foregoing, the partners of 245 Park
Avenue Company are O&Y Equity Company, L.P., Olympia &
York 245 Park Avenue Holding Company, L.P. and JMB/245
Park Avenue Associates, Ltd., and the residence addresses
of such partners are as follows:
NAME ADDRESS
O&Y Equity Company, L.P. 410 South State Street
Dover, Delaware 19901
Olympia & York 245 Park Avenue 410 South State Street
Holding Company, L.P. Dover, Delaware 19901
JMB/245 Park Avenue Associates, 875 North Michigan Avenue
Ltd. Suite 3900
Chicago, Illinois 60611
IN WITNESS WHEREOF, the undersigned have made and signed this
certificate as of the 30th day of June, 1988.
O&Y EQUITY COMPANY, L.P.
BY O&Y Equity General Partner
Corp., a general partner
By JOEL M. SIMON
Joel M. Simon
Executive Vice President
OLYMPIA & YORK 245 PARK AVENUE
HOLDING COMPANY, L.P.
By O&Y Equity General Partner
Corp., a general partner
By JOEL M. SIMON
Joel M. Simon
Executive Vice President
3
JMB/245 PARK AVENUE ASSOCIATES, LTD.,
an Illinois limited partnership
By JMB PARK AVENUE, INC.
an Illinois corporation,
Corporate General Partner
By
Vice President
WITHDRAWING PARTNER
OLYMPIA & YORK INTERESTS CORP.
By JOEL M. SIMON
Joel M. Simon
Executive Vice President
4<PAGE>
STATE OF NEW YORK )
: s.s.:
COUNTY OF NEW YORK )
On this 30th day of June, 1988, before me personally came Joel M.
Simon, to me known, who, being by me duly sworn, did depose and say that he
resides at 35 Midwood Cross, Roslyn, NY, that he is an Executive Vice
President of Olympia & York Interests Corp. and O&Y Equity General Partner
Corp., a general partner of each of O&Y Equity Company, L.P. and Olympia &
York 245 Park Avenue Holding Company L.P., two of the corporations
described in and which executed the above instrument, and that he signed
his name thereto on behalf of such corporations.
LORETTA TARAGAN
Loretta Taragan
Notary Public
5<PAGE>
STATE OF NEW YORK )
) s.s.:
COUNTY OF NEW YORK )
On this 26th day of July, 1988, before me personally came Donald F.
Sinex, to me known , who, being duly sworn, did depose and say that he
resides at 85 Rosebrook Rd., New Coanan Ct., that he is a Vice President of
JMB Park Avenue, Inc., the corporate general partner of JMB/245 Park Avenue
Associates, Ltd., one of the partnerships described in and which executed
the above instrument, and that he signed his name thereto on behalf of such
partnership.
ANTHONY CASARELE
Anthony Casarele
Notary Public
6<PAGE>
245 PARK
EXHIBIT 10-H.
- -------------
FIRST AMENDMENT TO FIRST AMENDED AND RESTATED
AGREEMENT OF GENERAL PARTNERSHIP OF 245 PARK AVENUE COMPANY
AMENDMENT, dated as of December 29, 1986, among JMB/245 PARK
AVENUE ASSOCIATES, LTD., an Illinois limited partnership ("Investor"), O&Y
EQUITY CORP., a New York corporation ("O&Y Equity"), FAME ASSOCIATES, a New
York general partnership ("FAME") and O&Y INTERESTS CORP, a New York
corporation ("Interests").
W I T N E S S E T H:
WHEREAS, Investor, O&Y Equity and FAME entered into a First
Amended and Restated Agreement of General Partnership of 245 Park Avenue
Company (formerly Olympia & York Estates Company), a New York general
partnership (the "Partnership"), dated as of December 29, 1983 (the
"Partnership Agreement");
WHEREAS, as of the date hereof, Investor, O&Y Equity, FAME and
Interests are the partners of the Partnership; and
WHEREAS, the partners of the Partnership desire to amend the
Partnership as provided herein;
NOW, THEREFORE, in consideration of the premises and other good
and valuable consideration, the parties hereto agree that the Partnership
Agreement is amended as follows:
1. All references in the Partnership Agreement to Olympia & York
Developments Limited or OYDL shall be deemed to include any successor to
Olympia & York Developments Limited by merger, consolidation or
amalgamation.
<PAGE>
2. O&Y Equity contemplates that subsequent to the date of
this Amendment, it will transfer to O&Y Equity Company, L.P., a Delaware
limited partnership ("Equity LP"), by contributing to the capital of Equity
LP, its entire interest in the Partnership. In addition, FAME may, directly
or indirectly, transfer to Equity LP all or part of its interest in the
Partnership (which transfer may take the form of a contribution to the
capital of Equity LP). Investor acknowledges that such transfers are
permitted under the Partnership Agreement. Upon the occurrence of either of
such transfers, Equity LP shall be admitted to the Partnership as a general
partner. The date on which such transfer by O&Y Equity occurs is
hereinafter called the "Effective Date".
3. Equity LP shall assume all of the obligations and
liabilities of O&Y Equity under the Partnership Agreement arising from and
after the Effective Date. In addition, Equity LP shall have all of the
rights of O&Y Equity under the Partnership Agreement. From and after the
Effective Date, all references in the Partnership Agreement to O&Y Equity
shall be deemed to refer to Equity LP unless the context requires
otherwise.
4. Equity LP shall assume all of the obligations and
liabilities of O&Y Equity under that certain Guaranty dated as of December
29, 1983, given by Equity to Investor and the Partnership, which arise from
and after the Effective Date (and O&Y Equity and its successors and assigns
(excluding Equity LP and the successors and assigns of Eq-
2
uity LP) will be released from any obligations and liabilities thereunder
which arise from and after the Effective Date).
5. From and after the Effective Date, Equity LP shall be
jointly and severally liable with Olympia and York 245 Lease Company to the
Partnership for the obligations and liabilities of the tenant under that
certain Agreement or Lease dated as of July 11, 1965, between Uris 245 Park
Corporation, as landlord, and the American Tobacco Company, a New Jersey
corporation, as tenant, as amended, with respect to certain space in the
building located at 245 Park Avenue, New York, New York (to the extent the
same were not retained by the American Tobacco Company, a Delaware
corporation). From and after the Effective Date, Equity LP shall be a
"Qualified Affiliate", as such term is defined in a certain letter
agreement dated April 17, 1986, between Investor and O&Y Equity (the
"Letter Agreement"). Equity LP shall assume all of the obligations and
liabilities of O&Y Equity under the Letter Agreement arising from and after
the Effective Date, at which time O&Y Equity and its successors and assigns
(excluding Equity LP and the successors and assigns of Equity LP) shall be
released from its obligations and liabilities under the Letter Agreement
and the foregoing Agreement of Lease.
6. The transfer or transfers of interests in the Partnership
described above shall be subject to the security
3
interest in favor of Investor under Section 9.3 of the Partnership
Agreement.
7. Promptly after the Effective Date, the parties hereto shall
execute, acknowledge and deliver an amendment to or restatement of the
Partnership's "doing business" certificate to reflect the transfer of O&Y
Equity's partnership interest set forth above, and Co-Partner shall cause
such amendment or restatement to be filed in the appropriate governmental
office.
8. Except as provided in this Amendment, all of the provisions
of the Partnership Agreement shall remain in full force and effect.
INSERT 4A
9. This Amendment shall be conditioned upon the execution
hereof by Equity LP in the space provided below upon
4
the completion of the transfer of Equity's interest in the Partnership to
Equity LP.
IN WITNESS WHEREOF, the undersigned have executed this
Amendment as of the date first above written.
O&Y EQUITY CORP., a New York corporation
By:
Executive Vice President
"O&Y Equity"
FAME ASSOCIATES, a New York
general partnership
By: Abraham H. Fruchthandler,
General Partner
By: Edward J. Minskoff, General Partner
By: Fruchthandler Brothers Enterprises,
a New York limited partnership,
General Partner
By: Abraham H. Fruchthandler,
General Partner
"FAME"
O&Y INTEREST CORP., a New York corporation
By:
Executive Vice President
"Interests"
5
O&Y Equity Company, L.P. is executing this Amendment as successor to the
interest of FAME ASSOCIATES in the Partnership.
O&Y EQUITY COMPANY, L.P.
By O&Y Equity General Partner Corp.,
General Partner
By
Executive Vice President
<PAGE>
JMB/245 PARK AVENUE ASSOCIATES, LTD.
an Illinois limited partnership
By: JMB Managers II, Inc.
an Illinois corporation
General Partner
By:
Title: Vice President
"Investor"
The undersigned acknowledges that it has succeeded to the
ownership of substantially all of the assets of Equity, and has assumed
substantially all of the assets of Equity's liabilities. The undersigned
agrees to the provisions of this Amendment, agrees that it shall be a
general partner of the Partnership, and shall be bound by the obligations
and liabilities of Equity as set forth in this Amendment from and after the
Effective Date.
Dated: O&Y EQUITY COMPANY, L.P.
By: O&Y Equity General Partner Corp.,
General Partner
By:
Title: Executive Vice President
6<PAGE>
INSERT 4A
8A. SECTION 8.1A of the Partnership Agreement is deleted in its
entirety and the following new SECTION 8.1A is inserted in lieu thereof:
A. The death, insanity, bankruptcy or dissolution of a general
partner (except that where the general partner is a partnership and its
business shall be continued pursuant to the provisions of the partnership
agreement governing such partnership, or the general partner is O&Y Equity
or FAME and only an "Affiliate" of the same shall receive a general
partnership interest in this Partnership by reason of such dissolution, or
the General Partner is Investor and only one or more of the present
partners therein or an Affiliate of the same shall receive a general
partnership interest in the Partnership by reason of such dissolution, then
this Partnership shall not be dissolved by reason of the dissolution of
such general partner [the term "Affiliate" as used in the foregoing
provisions of this sentence having the same meaning as in the first
sentence of section 7.3A hereof].
245 PARK
EXHIBIT 10-I.
- -------------
237 Park Avenue
New York, New York 10017
September 7, 1989
JMB/245 Park Avenue Associates, Ltd.
900 North Michigan Avenue
Chicago, Illinois 60611
Re: 245 PARK AVENUE, NEW YORK, NEW YORK
(THE "PREMISES")
Gentlemen:
Reference is made to the following transactions relating to the
Premises (collectively, the "Loan Transactions"):
A. the severance of the existing first mortgage loan
affecting the Premises (the "Aetna Loan") held by Aetna
Life Insurance Company ("Aetna") (the outstanding
principle balance of which on the date hereof is
$219,201,665.47), into two portions, in the respective
principal amounts of $199,201,665.47 and $20,000,000,
pursuant to a Severance Agreement 1989 of even date
herewith among 245 Park Avenue Company (the "Borrower"),
Olympia & York 245 Lease Company, the undersigned and
Aetna (the "Severance Agreement");
B. The purchase by the Dai-Ichi Kangyo Bank, Limited, New
York Branch ("DKB") of the $20,000,000 portion of the
Aetna Loan described above, evidenced by a note in the
principal amount of $20,000,000 (the " $20,000,000 Note")
and secured by Substitute Mortgage No.2 (as such term is
defined in the Severance Agreement);
C. The modification of the $20,000,000 Note pursuant to a
Modified and Restated Mortgage Note of even date herewith
given by the Borrower to DKB;
D. The purchase by DKB from Canadian Imperial Bank of
Commerce, New York Agency of a second mortgage loan
affecting the Premises, in the principal amount of
$147,500,000; and
E. The making of additional mortgage loans (the "New Loans")
with respect to the Premises by DKB to the
<PAGE>
Borrower, in the aggregate principle amount of up to
$29,000,000 (of which $17,000,000 is being disbursed to
the Borrower on the date hereof). The loans of the
remaining $12,000,000, which may be disbursed by DKB to
the Borrower pursuant to a letter agreement of even date
herewith between the Borrower and DKB, are referred to in
this letter as the "Future Loans".
Reference also is made to a certain letter agreement dated
March 6, 1987 among the undersigned, the Borrower, Olympia & York 245 Lease
Company and you (the "Bear Stearns Letter"), and to the First Amended and
Restated Agreement of General Partnership of 245 Park Avenue Company, as
amended (the "Partnership Agreement"). All capitalized terms which are not
defined in this letter shall have their meanings set forth in the Bear
Stearns Letter.
The undersigned and you, as general partners of the Borrower,
desire to set forth certain understandings with respect to the above
transactions. Accordingly, the undersigned and you agree as follows:
1. The interest rate under the $20,000,000 Note shall be
9.275% per annum (the "New Rate"). With respect to any given period, the
amount by which (i) the interest that would be payable under the
$20,000,000 Note if such interest were at the rate of 12% per annum exceeds
(ii) the sum of (A) the interest payable under the $20,000,000 Note at the
New Rate plus (B) the amount of any additional payments made by the
Partnership under Sections 7 and 8 of the New Note to the extent such
payments are not the responsibility of "Co-Partner" (as such term is
defined in the Partnership Agreement), pursuant to clause (i) of Paragraph
9 of this letter, is referred to in this letter as the "Interest Savings"
for such period.
2. The undersigned and you each represents and warrants to
the other that to its knowledge, the information given to DKB in a
Certificate, a copy of which is attached to this letter as Exhibit A, is
true and correct in all material respects.
3. The costs and expenses of closing the Loan Transactions
described above, and the commitment of facility fees charged by DKB, shall
be borne as follows:
a. the title insurance premium with respect to the
$20,000,000 Note, in the amount of $7,037, shall be paid
by Co-Partner and Investor (as such term is defined in
the Partnership Agreement), in accordance with their
Distributive Percentages (as defined in the Partnership
Agreement).
2
b. Investor shall pay $20,000 on account of legal fees with
respect to the Loan Transactions.
c. all other closing costs and expenses (including, without
limitation, all other legal fees, title insurance
premiums and any mortgage recording taxes payable with
respect to the New Loans) and commitment or facility fees
and all other fees shall be paid by Co-Partner. The
legal fees referred to in this subparagraph (c) and in
subparagraph (b) above shall include the fees of Messrs.
Kaye, Scholer, Fierman, Hays & Handler, Messrs. Pircher,
Nichols & Meeks, Messrs. Schulte, Roth & Zabel and
Messrs. Mayer, Brown & Platt. Co-Partner shall not be
entitled to any reimbursement from you or the Borrower
for costs and expenses borne by Co-Partner pursuant to
this paragraph (c). In addition, by reason of its
payment of such costs and expenses, Co-Partner shall not
be entitled to any credit to its capital account in
Borrower that is not (or will not be offset by the
allocation of deductions (or a reduction in the amount of
gain allocated) to Co-Partner.
Notwithstanding anything to the contrary contained in the
Partnership Agreement, any deductions (or reduction in gain recognized) for
income tax purposes attributable to the payment of the amounts described in
this Paragraph 3 shall be allocated between Co-Partner and Investor in
proportion to the amounts paid by each of them.
Co-Partner shall be entitled to receive, from the next amounts
otherwise distributable to Investor under Section 3.2C of the Partnership
Agreement, an amount equal to 48.2467039% of the amount paid or to be paid
by Co-Partner for mortgage recording taxes with respect to the New Loans.
4. You acknowledge that the undersigned is entering into one
or more Interest Rate Swap Agreements with DKB (collectively, the "Swap
Agreements"), having a "notional amount" equal to the original principal
amount, as reduced from time to time, under the loans to be purchased or
made by DKB, including, without limitation, the Future Loans. The
undersigned is obligated under the Swap Agreements to make certain payments
thereunder and reimburse DKB for certain costs and expenses, and neither
the Borrower nor you shall have any liability therefor. Neither the
Borrower nor you shall have any liability for, and neither the Borrower nor
you shall be entitled to receive, any portion of any payments made under,
with respect to or on account of, the Swap Agreements or any termination
thereof.
3
5. You shall have the irrevocable option, exercisable not
later than December 31, 1989, to increase "Minimum Return" (as such term is
defined in the Partnership Agreement) applicable for the period from the
date hereof through October 1, 1993 by the Interest Savings for such period
(such increase to be allocated among Co-Partner and Investor in accordance
with their Distributive Percentages). In such event, all references in the
Partnership Agreement to the Minimum Return shall refer to the Minimum
Return, as so increased, and in the definition of "Achievement Date", the
number $16,500,080 shall be increased to $17,045,080.
6. The proceeds of the $17,000,000 being advanced on the
date hereof will be applied on account of 245 Premises Costs shown in the
schedule set forth in Exhibit B to this letter. Furthermore, the proceeds
of all Future Loans will be used solely for JMB Priority Distributions.
7. The New Loans constitute a portion of the Park Company
Loan. The undersigned acknowledges that its obligations under the Bear
Stearns Letter with respect to the New Loans, to the extent the New Loans
are not repaid from the proceeds of a Refinancing, shall remain in full
force and effect. The undersigned may finance additional amounts
constituting the Park Company Share in accordance with the Bear Stearns
Letter. Nothing herein shall be construed as modifying the Bear Stearns
Letter, which is hereby ratified and confirmed in its entirety.
8. The undersigned represents and warrants that no documents
have or will be entered into with DKB in connection with the Loan
Transactions or the Premises, to which the Borrower is not a party, other
than (a) the Swap Agreements and any documents ancillary thereto, and (b) a
subordination agreement under which Olympia & York 245 Lease Company will
subordinate its interests to the liens of certain mortgages to be held by
DKB.
9. Co-Partner shall be solely responsible for (i) the
payment of all amounts described in Paragraphs 7 and 8 of the $20,000,000
Note to the extent that the sum of (A) such amounts and (B) interest under
the $20,000,000 Note at the New Rate exceeds $2,000,000 during any year and
for each such year (with appropriate prorations for partial years) and (ii)
the payment of all amounts described in Paragraphs 7 and 8 of the notes
evidencing the New Loans. By reason of the payments borne by Co-Partner
pursuant to this Paragraph 9, Co-Partner shall no be entitled to (i) any
reimbursement from you or the Borrower or (ii) any credit to its capital
account in the Borrower that is not (or will not be) offset by the
allocation of deductions (or a reduction in the amount of gain allocated)
to Co-Partner. Notwithstanding anything to the contrary contained in the
Partnership Agreement, any deductions (or reduction in gain
4
recognized) for income tax purposes attributable to payments which Co-
Partner has made pursuant to this Section 9 shall be allocated to Co-
Partner.
10. Notwithstanding your or the Borrower's execution and
delivery of this letter or of any documents evidencing the Loan
Transactions, we understand and agree that you (acting either for yourself
or on behalf of the Borrower) have reserved the right to audit, contest
and/or request further information with respect to any items comprising or
allegedly comprising 245 Premises Costs (including, without limitation,
items shown in Exhibit B) and that your execution and delivery of the
documents evidencing the Loan Transactions shall not be construed as a
waiver of your rights in respect of any such audit, contest or request.
11. Copies of the certificates given by Investor to DKB
pursuant to clause (iii) of Part C, Section 1(f) of the mortgages securing
the $20,000,000 Note and the notes evidencing the New Loans shall
simultaneously be delivered to Co-Partner.
12. The partners of the Borrower hereby confirm their present
intention to refinance the Future Loans and all other mortgage indebtedness
that will encumber the Premises following the consummation of the Loan
Transactions, on or before October 1, 1993.
This letter (i) contains the entire agreement of the
undersigned and you with respect to the subject matter hereof, (ii) shall
be governed by, and construed in accordance with, the laws of the State of
New York, (iii) may not be modified or terminated, nor may any provision
hereof be waived, except in a writing signed by the party against whom
enforcement of any modification, termination or waiver is sought, (iv)
shall not be deemed to be for the benefit of any third party, and (v) shall
bind and inure to the benefit of the undersigned and you, and the
respective successors and assigns of the undersigned and you. As
supplemented hereby, the Partnership Agreement is ratified and confirmed in
its entirety.
Please indicate your agreement to the provisions of this letter
by signing a counterpart hereof in the space provided below.
Very truly yours,
O&Y EQUITY COMPANY, L.P.
By: O&Y Equity General Partner
Corp., general partner
By:
Title: Vice President - Corporate
5<PAGE>
AGREED TO:
JMB/245 PARK AVENUE ASSOCIATES, LTD.
By: JMB Park Avenue, Inc.,
general partner
By:
Title:
6<PAGE>
EXHIBIT B
245 PARK AVENUE
PARK COMPANY SHARE OF 245 PREMISES COSTS
AND JMB PRIORITY DISTRIBUTIONS TO BE
FINANCED BY THE NEW DKB LOANS
(as of February 28, 1989)
A) BEAR STEARNS ASBESTOS COST 2,825,636
B) LEGAL COSTS 200,000
C) TENANT INSTALLATIONS 112,612
D) DEFERRED RENTING 18,497
E) 55 TAKEOVER INSTALLMENTS 7,806,931
F) INTEREST ON ABOVE AS OF 3/22/89 1,301,374
G) PREVIOUS JMB PRIORITY DISTRIBUTIONS 4,000,000
H) COMPOUND INTEREST ON JMB
PRIORITY DISTRIBUTIONS 217,150
I) JMB PRIORITY DISTRIBUTIONS
ON 3/31/89 AND 6/30/89 2,000,000
-----------
TOTAL 18,482,200
===========
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
REGISTRANT'S FORM 10-Q FOR THE THREE MONTHS ENDED MARCH 31, 1996 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS
INCLUDED IN SUCH REPORT.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> MAR-31-1996
<CASH> 6,880
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 6,880
<CURRENT-LIABILITIES> 16,382,328
<BONDS> 43,236,631
<COMMON> 0
0
0
<OTHER-SE> (137,628,706)
<TOTAL-LIABILITY-AND-EQUITY> 6,880
<SALES> 0
<TOTAL-REVENUES> 0
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 25,029
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 756,713
<INCOME-PRETAX> (781,742)
<INCOME-TAX> 0
<INCOME-CONTINUING> (2,556,104)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (2,556,104)
<EPS-PRIMARY> (2,402)
<EPS-DILUTED> (2,402)
</TABLE>
