SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): December 30, 1997
JMB INCOME PROPERTIES, LTD. - XII
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(Exact name of registrant as specified in its charter)
Illinois 0-16108 36-3337796
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(State or other) (Commission (IRS Employer
Jurisdiction of File Number) Identification No.)
Organization
900 N. Michigan Avenue, Chicago, Illinois 60611-1575
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(Address of principal executive office)
Registrant's telephone number, including area code: (312) 915-1987
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<PAGE>
40 BROAD STREET OFFICE BUILDING
NEW YORK, NEW YORK
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ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS. On December 30, 1997, JMB
- - 40 Broad Street Associates (the "Venture"), a joint venture between JMB
Income Properties Limited Partnership - XII (the "Partnership") and JMB
Income Properties Limited Partnership - X ("JMB-X"), an affiliated
partnership sponsored by the Managing General Partner of the Partnership,
sold the land, building and related improvements commonly known as the 40
Broad Street Office Building (the "Property"), located in New York, New
York. The purchaser, 40 Broad Delaware, Inc., a Delaware corporation, is
not affiliated with the Partnership or its General Partners and the sale
price was determined by arm's-length negotiations. The Property is an
approximate 259,800 square foot office building and, as of the date of
sale, was approximately 88% occupied.
The sale price of the Property was $34,735,000 (before selling costs
and prorations) and cash proceeds received from the sale, net of closing
costs, was approximately $33,205,000, of which the Partnership's share was
approximately $22,765,000. The Property was classified as held for sale as
of July 1, 1997 and therefore has not been subject to continued
depreciation from such date for financial reporting purposes. The Venture
expects to recognize a gain of approximately $21,000,000 for financial
reporting purposes (predominantly due to provisions for value impairment
totaling approximately $52,000,000 recorded in 1990 and 1991) and a loss of
approximately $9,000,000 for Federal income tax purposes in 1997, of which
the Partnership's share is approximately $14,398,000 and $6,170,000,
respectively. In addition, in connection with the sale of the Property, as
is customary in such transactions, the Venture agreed to certain
representations, warranties and covenants with a stipulated survival period
that expires December 1, 1998. Although it is not expected, the Venture
and the Partnership may ultimately have some liability under such
representations, warranties and covenants, but such liability has been
limited in the sale agreement to actual damages in an amount not to exceed
$1,500,000 in the aggregate.
The terms of the JMB - 40 Broad Street Associates venture agreement
generally provide that sale proceeds will be allocated or distributed as
the case may be, 68.56% to the Partnership and 31.44% to JMB-X.
The Partnership Agreement provides that the General Partners shall
receive as a distribution from the sale of a real property by the
Partnership amounts equal to the cumulative deferrals of any portion of
their 10% cash distribution and 2-1/2% of the selling price, and that the
remaining proceeds (net after expenses and retained working capital) be
distributed 85% to the Limited Partners and 15% to the General Partners.
However, notwithstanding such allocations, the Limited Partners shall
receive 100% of such net sale proceeds until the Limited Partners (i) have
received cumulative cash distributions from the Partnership's operations
which, when combined with sale or refinancing proceeds previously
distributed, equal a 6% annual return on the Limited Partners' average
capital investment for each year (their initial capital investment as
reduced by sale or refinancing proceeds previously distributed) commencing
with the second fiscal quarter of 1986, (ii) have received cash
distributions of sale or refinancing proceeds in an amount equal to the
Limited Partners' aggregate initial capital investment in the Partnership
and (iii) have received cash distributions of sale and refinancing proceeds
and of the Partnership's operations, in an amount equal to the Limited
Partners' initial capital investment in the Partnership plus a 10% annual
return on the Limited Partners' average capital investment. The Limited
Partners have not received and are not expected to receive cash
distributions to satisfy the preference requirements described above.
Therefore, the General Partners are waiving any right to receive
distributions from this sale.
<PAGE>
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial Statements. Not applicable.
(b) Pro Forma Financial Information - Narrative.
As a result of the sale of the Property by the Venture, beyond the
date of sale there will be no further rental income, interest income,
property operating expenses, amortization of deferred expenses and venture
partners' share of venture operations for the Venture in the consolidated
financial statements of the Partnership, which for the Partnership's fiscal
year ended December 31, 1996 were approximately, $5,491,000, $45,000,
$4,093,000, $157,000 and ($183,000), respectively. Rental income, interest
income, property operating expenses, amortization of deferred expenses and
venture partners' share of venture operations were approximately,
$4,249,000, $33,000, $2,660,000, $104,000 and ($374,000), respectively, for
the nine months ended September 30, 1997 in the consolidated financial
statements of the Partnership. Also as a result of the Venture's sale of
the Property, there are no further assets and liabilities related to the
Venture in the Partnership's consolidated financial statements, which at
September 30, 1997 consisted of cash and other current assets of
approximately $1,814,000; properties held for sale or disposition of
approximately $10,014,000; accrued rents receivable of approximately
$1,636,000; deferred expenses of approximately $839,000; current
liabilities of approximately $303,000; tenant security deposits of
approximately $113,000 and venture partner's equity in venture of
approximately $4,149,000.
(c) Exhibits.
10.1 Purchase agreement and certain exhibits thereto between JMB -
40 Broad Street Associates, an Illinois general partnership, and 40 Broad
Delaware, Inc., a Delaware corporation, dated December 30, 1997.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
JMB INCOME PROPERTIES, LTD - XII
BY: JMB Realty Corporation
(Managing General Partner)
By: GAILEN J. HULL
Senior Vice President
Principal Accounting Officer
Dated: January 14, 1998
EXHIBIT 10.1
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PURCHASE AGREEMENT
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THIS AGREEMENT is made and entered into as of the ___ day of
December, 1997, by and between JMB-40 BROAD STREET ASSOCIATES, an Illinois
general partnership (hereinafter called "SELLER"), and 40 BROAD DELAWARE,
INC., a Delaware corporation (hereinafter called "BUYER").
R E C I T A L S
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A. Seller is the owner of that certain real property located in
the City, County and State of New York, consisting primarily of an office
building sometimes known as "40 Broad Street".
B. Buyer desires to purchase such premises on the terms and
conditions hereinafter documented.
NOW, THEREFORE, in consideration of the mutual undertakings of the
parties hereto, it is hereby agreed as follows:
1. PURCHASE AND SALE. Seller shall sell to Buyer, and Buyer shall
purchase from Seller, all upon the terms, covenants and conditions
hereinafter set forth, the following (herein collectively referred to as
the "PROPERTY"):
(a) the land legally described on Exhibit "A" attached hereto
and made a part hereof, together with all buildings, improvements and
fixtures located thereon and all of Seller's right, title and interest in
and to all rights, privileges and appurtenances pertaining thereto,
including all of Seller's right, title and interest in and to all
easements, rights-of-way, open or proposed streets, alleys, easements,
strips or gores of land adjacent thereto (collectively, the "REAL
PROPERTY"), including the office building located on the Real Property
commonly known as "40 Broad Street" (the "BUILDING");
(b) all right, title and interest of Seller in and to
(i) those items of personal property described in Exhibit "B" attached
hereto and made a part hereof and all other tangible personal property
located on the Real Property and used in the ownership, operation and
maintenance of the Real Property, including, without limitation, all
furniture, furnishings, fixtures, appliances, machinery and equipment owned
by Seller and relating to the Property, (provided, however, the foregoing
does not include any proprietary software items), and (ii) all intangible
property relating to the Property, including, without limitation, any and
all rights of Seller in and to the name "40 Broad Street", all plans and
specifications for the Property, all third party engineering, soils,
curtain wall and hazardous reports and any other third party studies
relating to the Property, all catalogues, warranties, guarantees,
correspondence with present or prospective tenants or suppliers, non-
proprietary books, records and files (including those maintained by
Seller's third party property manager, to the extent owned by or under the
control of Seller) relating to the condition or operations of the Property,
advertising materials, and telephone exchange numbers (such tangible and
intangible property described in this subparagraph (b) is herein
collectively called the "PERSONAL PROPERTY"); and
(c) all right, title and interest of Seller (i) in all
leases, licenses and occupancy agreements affecting the Real Property
(collectively, the "LEASES"), in each case together with all underlying
agreements, work letters, side letters, other agreements relating thereto,
and guarantees, warranties and indemnifications from contractors,
subcontractors, materialmen, suppliers and others relating to the Property,
and in each case, as the same have been or may hereafter be amended,
restated, altered, supplemented or otherwise modified from time to time,
together with all claims under the foregoing (provided that, subject to
Section 5D(1)(b) below, Seller shall not thereby be deemed to have waived
or released any rights to indemnification or any defenses, counterclaims or
other similar claims with respect to pre-closing occurrences), all
refundable security deposits and letters of credit required to be held by
Seller under any Lease (collectively, "SECURITY DEPOSITS") and all lease
offers and options, together with all rents and other sums due under the
Leases, including, without limitation, all base rent, percentage rent,
additional rent, other escalations and common area maintenance charges,
together with all other revenue of any kind whatsoever derived from the
Leases or the Property from and after the Closing (collectively, the
"RENTS"), (ii) in and to the service, supply, maintenance, utility and
commission agreements, and equipment leases described in Exhibit "R"
attached hereto and incorporated herein by this reference which Buyer has
agreed to assume ("CONTRACTS BEING ASSIGNED") and all claims thereunder
(provided that, subject to Section 5D(1)(b) below, Seller shall not thereby
be deemed to have waived or released any rights to indemnification or any
defenses, counterclaims or other similar claims with respect to pre-closing
occurrences), and (iii) in and to all licenses, the certificates of
occupancy, permits, consents, approvals and other written authorizations
relating to the use, operation or ownership of the Real Property or
Personal Property (the rights and interests of Seller described in this
subparagraph (c) are herein collectively called the "OTHER PROPERTY
RIGHTS").
2. PURCHASE PRICE. The purchase price (the "PURCHASE PRICE") for
the Property shall be the sum of $34,735,000, subject to the prorations and
adjustments set forth in paragraph 5 or as otherwise provided under this
Agreement.
3. PAYMENT OF PURCHASE PRICE. The Purchase Price, as adjusted by
the prorations and credits specified herein, shall be paid in cash on the
"Closing Date", as hereinafter defined (the amount to be paid under this
Section 3 being herein called the "CLOSING PAYMENT") in accordance with
Section 5A below.
4. CONDITIONS PRECEDENT.
A. TITLE MATTERS.
(1) TITLE COMMITMENT. Buyer has ordered and received a
copy of that certain Commitment for Title Insurance ("TITLE COMMITMENT")
covering the Property from Chicago Title Insurance Company and Stewart
Title Insurance Company and Fidelity National Title Insurance Company,
(which companies, in their respective capacities as title insurers
hereunder, are herein called the "TITLE COMPANIES"). In addition, Buyer
has received a copy of that certain survey ("SURVEY") of the Property
prepared by Earl B. Lovell - S. P. Belcher, Inc., dated November 13, 1997.
(2) EXCEPTIONS TO TITLE. It shall be a condition to
Buyer's obligation to close the transactions under this Agreement that, at
Closing, Buyer shall receive an ALTA owner's title insurance policy (or
"marked up" binder) in the form, and containing the endorsements,
affirmative insurance, and reinsurance agreements, specified in Exhibit "C"
attached hereto and made a part hereof (the "OWNER'S POLICY").
B. COMPLETED DUE DILIGENCE REVIEWS.
(1) PRICE REFLECTIVE OF REVIEWS. Buyer has performed
and completed those of Buyer's due diligence examinations, reviews and
inspections of matters pertaining to the purchase of the Property,
including leases, service contracts, warranties, survey and title matters,
and physical, environmental and compliance matters and conditions
respecting the Property, as Buyer has desired to complete prior to the
execution and delivery of this Agreement. Seller and Buyer have discussed
the results of Buyer's due diligence examinations, reviews and inspections
and the Purchase Price has been adjusted to appropriately take such due
diligence matters into account to Buyer's satisfaction and has been
determined based on, among other things, such examinations, reviews and
inspections, as well as the representations, warranties, covenants and
agreements of the parties set forth in this Agreement (and nothing
contained in this paragraph shall limit, constitute a waiver of or
otherwise affect the obligations of or the enforceability of any of the
parties' respective representations, warranties, covenants or agreements
set forth herein or the "Closing Documents", as hereinafter defined).
(2) CONDUCT OF REVIEWS. Buyer will indemnify, defend,
and hold Seller harmless from and against any damage, loss, cost or expense
for personal injury or property damage caused by Buyer or its agents in
connection with its due diligence reviews, inspections or examinations at
the Property. In the event of termination hereunder, Buyer shall return
all documents and other materials furnished by or on behalf of Seller
hereunder. The parties acknowledge that the information and data received
or obtained in connection with the transactions contemplated hereunder are
subject to that certain confidentiality letter agreement dated November 2,
1997; provided, that upon completion of the Closing, the November 2, 1997
letter agreement shall terminate and be of no further force or effect.
(3) ESTOPPEL CERTIFICATES. It shall be a condition to
Buyer's obligation to purchase the Property hereunder that, on or before
the Closing Date, Buyer shall have received estoppel certificates ("TENANT
ESTOPPEL CERTIFICATES"), dated not more than thirty (30) days prior to the
Closing Date, from (i) those full-floor tenants listed on Exhibit "D"
attached hereto and made a part hereof, and (ii) a sufficient number of the
balance of the tenants at the Property so that Tenant Estoppel Certificates
shall be received under clauses (i) and (ii) hereof with respect to not
less than 85% of the tenants under leases in effect as of the Closing Date.
Each Tenant Estoppel Certificate shall be substantially in the form
provided in Exhibit "E" attached hereto and made a part hereof, without
adverse disclosures or statements.
(4) PERFORMANCE BY SELLER. The performance and
observance, in all material respects, by Seller of all covenants and
agreements of this Agreement to be performed or observed by Seller prior to
or on the Closing Date (including, without limitation, the delivery by
Seller of all items required under paragraph 5B(1) below) shall be a
condition precedent to Buyer's obligation to purchase the Property.
(5) PERFORMANCE BY BUYER. The performance and
observance, in all material respects, by Buyer of all covenants and
agreements of this Agreement to be performed or observed by Buyer prior to
or on the Closing Date (including, without limitation, the delivery by
Buyer of all items required under paragraph 5B(2) below) shall be a
condition precedent to Seller's obligation to sell the Property).
5. CLOSING PROCEDURE. The sale and purchase herein provided shall
be consummated at a closing conference (the "CLOSING") which shall be held
on the Closing Date at a mutually agreed upon location. As used herein,
"CLOSING DATE" means December ___, 1997, or such earlier date as may be
agreed upon in writing by Buyer and Seller.
A. ESCROW CLOSING. The closing of the transactions
hereunder shall be consummated by a so-called "Escrow" closing. On the
last business day prior to the Closing Date, Buyer and Seller shall conduct
a pre-closing conference at a mutually agreed upon location, with title
transfer and payment of the Purchase Price to be completed on the Closing
Date, pursuant to the terms of an Escrow Agreement to be agreed upon by
Seller, Buyer and the Title Companies (the "ESCROW AGREEMENT"). Provided
all conditions to Seller's obligations hereunder have been satisfied or
otherwise waived, and subject to the Escrow Agreement, Seller shall convey
title to the Real Property to Buyer on the Closing Date by delivering a
duly executed and acknowledged original bargain and sale deed, with
covenants against grantor's acts ("DEED") in the form attached as Exhibit
"F" hereto. Provided all conditions to Buyer's obligations hereunder have
been satisfied or otherwise waived, and subject to the Escrow Agreement,
Buyer shall deliver the Closing Payment in immediately available federal
funds pursuant to the joint "Direction Letter" described in the Escrow
Agreement. Such deliveries shall be made pursuant to the Escrow Agreement.
B. DELIVERY TO PARTIES. Provided all conditions to Closing
shall have been satisfied or otherwise waived, the following items shall be
delivered at the Closing:
(1) SELLER DELIVERIES. Seller shall deliver (or cause
to be delivered) to Buyer the Deed and the following:
(a) A duly executed and acknowledged agreement of
assignment and assumption of Leases, Rents and the Security Deposits
("TENANT LEASE ASSIGNMENT AND ASSUMPTION") in the form attached as Exhibit
"G" hereto;
(b) A duly executed assignment and assumption of
the Contracts Being Assigned and an assignment (without assumption of any
obligations thereunder) of all licenses, permits, warranties, guaranties
and Other Property Rights ("GENERAL ASSIGNMENT AND ASSUMPTION") in the form
attached as Exhibit "H" hereto;
(c) A duly executed bill of sale respecting to
Personal Property ("BILL OF SALE"), in the form attached as Exhibit "I"
hereto;
(d) To the extent not previously delivered to
Buyer, originals (or true and correct copies if originals are not
available) of all Leases, Contracts, certificates of occupancy, licenses,
permits, authorizations and approvals, warranties, plans and specifications
and keys tagged for identification, third party engineering, soils, curtain
wall and hazardous reports and studies relating to the Property,
catalogues, guarantees, correspondence with present or prospective tenants
or suppliers and non-proprietary books, records and files relating to the
condition and operations of the Property (such items being limited to those
in Seller's possession or control and shall be deemed delivered by Seller
retaining the same at the Property);
(e) All Tenant Estoppel Certificates received by
Seller;
(f) Duly executed and acknowledged certificates
regarding the "non-foreign" status of Seller;
(g) An original letter ("TENANT NOTICE LETTER")
in form reasonably acceptable to both Seller and Buyer addressed to each
tenant under the Leases, of which will be sent notifying it of the sale of
the Property to Buyer and the transfer of Security Deposit to Buyer and
advising it that all future payments of Rent and other payments due under
the Leases are to be made to Buyer at an address designated by Buyer;
(h) [INTENTIONALLY DELETED].
(i) With respect to any Security Deposits which
are letters of credit or are otherwise non-cash security deposits, Seller
shall (i) if the same are assignable, deliver to Buyer at the Closing such
original letters of credit or non-cash security deposits, and execute and
deliver such other instruments as the issuers of such letters of credit or
non-cash security deposits shall reasonably require in connection with such
assignment, and (ii) if such letter of credit or non-cash security deposit
is not transferable, Seller shall reasonably cooperate with Buyer to cause
the Tenant to deliver a replacement letter of credit or non-cash security
deposit, or, at Buyer's option, Seller and Buyer shall execute and deliver
at the Closing an appropriate agreement (in form reasonably acceptable to
both parties) pursuant to which the benefits of such letter of credit or
non-cash security deposit are made available to Buyer (provided the
foregoing obligations do not materially increase the costs to, or liability
or obligations of, Seller in a manner not otherwise provided for herein).
Notwithstanding the foregoing, Seller agrees that, if after the Closing and
prior to the issuance of any amendment to a letter of credit which names
the Buyer as the beneficiary thereunder, or after the Closing and prior to
the issuance of a substitute letter of credit which names the Buyer as the
beneficiary thereunder, or any other evidence confirming the transfer by
the issuing bank of the letters of credit to Buyer, Buyer notifies Seller
in writing to draw down on any such letter of credit on Buyer's behalf,
Seller will, at Buyer's sole cost and expense, do so upon Seller's receipt
of a written instruction to draw down on such letter of credit and to
deliver the proceeds to Buyer, provided that prior thereto Buyer shall
certify to Seller that pursuant to the terms of the applicable Lease, Buyer
is entitled to draw down such letter of credit and delivers Seller a
written agreement to indemnify and hold harmless Seller, and Seller's
successors and assigns, from and against all claims, damages, losses,
liabilities and expenses (including, without limitation, reasonable
attorneys' fees) with respect to Buyer's instructions. The obligations of
Seller referred to in the preceding sentence hereof shall survive the
Closing for a period of four (4) months;
(j) Duly completed, signed and acknowledged real
estate transfer tax returns and any other applicable transfer tax returns
or forms (including the New York State Real Estate Transfer Tax Return
(Form TP-584) and the New York City Real Property Transfer Tax Return (NYC
RPT);
(k) Applicable City, County or State of New York
change of ownership forms;
(l) Evidence reasonably satisfactory to Buyer and
Title Company respecting the due organization of Seller and the due
authorization and execution of this Agreement and the documents required to
be delivered hereunder;
(m) Any other documents required to be delivered
hereunder; and
(n) Such additional documents as may be
reasonably required by Buyer or Title Company in order to consummate the
transactions hereunder (provided the same do not materially increase the
costs to, or liability or obligations of, Seller in a manner not otherwise
provided for herein).
(2) BUYER DELIVERIES. Buyer shall deliver to Seller
the Closing Payment and the following:
(a) A duly executed and acknowledged Tenant Lease
Assignment and Assumption;
(b) A duly executed General Assignment and
Assumption;
(c) A duly executed Tenant Notice Letter;
[INTENTIONALLY DELETED].
(e) Duly completed, signed and acknowledged real
estate transfer tax returns and any other applicable transfer tax returns
or forms (including the New York State Real Estate Transfer Tax Return
(Form TP-584) and the New York City Real Property Transfer Tax Return (NYC
RPT);
(f) Evidence reasonably satisfactory to Seller
and Title Company respecting the due organization of Buyer and the due
authorization and execution of this Agreement and the documents required to
be delivered hereunder;
(g) Any other documents required to be delivered
hereunder; and
(h) Such additional documents as may be
reasonably required by Seller and Title Company in or to consummate the
transactions hereunder (provided the same do not materially increase the
costs to, or liability or obligations of, Buyer in a manner not otherwise
provided for herein).
C. CLOSING COSTS. Seller shall pay the state, county or
local real estate transfer taxes payable in the State, City or County of
New York attributable to the Deed and conveyance of the Property. Buyer
shall pay (i) the title insurance premium for the Owner's Policy, (ii) the
cost to obtain the Survey, and (iii) all fees, costs or expenses in
connection with Buyer's due diligence reviews hereunder. Seller and Buyer
shall each pay one-half of the recording fees attributable to the Deed.
Seller and Buyer shall pay their respective shares of prorations as
hereinafter provided.
D. PRORATIONS.
(1) ITEMS TO BE PRORATED. The following shall be
prorated between Seller and Buyer as of 11:59 p.m. on the day prior to the
Closing Date, with such prorations being calculated (except as otherwise
set forth below) on the basis of Seller being responsible for all expenses
and entitled to all income attributable to periods prior to the Closing
Date and Buyer being responsible for all expenses and entitled to all
income attributable to periods on and after the Closing Date.
(a) REAL ESTATE TAXES AND ASSUMPTIONS.All real
estate taxes and assessments on the Property for the 1997 calendar year,
with such proration being calculated on the basis of the tax bill for the
tax period commencing January 1, 1997 through June 30, 1997 and the tax
period commencing July 1, 1997 through December 31, 1997. If tax refunds
are paid to Buyer after the Closing Date for periods prior to the Closing
Date, then after deducting the amounts required to be returned to tenants
pursuant to the terms of the leases (as determined by Buyer in good faith)
and the reasonable costs (including, without limitation, any third party
legal fees and expenses relating thereto) incurred by Buyer to pursue,
collect and process such refunds (appropriately adjusted if such costs are
also applicable to refunds obtained for periods on or after the Closing
Date), the net refund amounts attributable to Seller's period of ownership
shall be promptly paid over to Seller by Buyer. In no event shall Seller
be charged with or be responsible for any increase in the taxes on the
Property resulting from the sale of the Property or from any improvements
made or leases entered into on or after the Closing Date. If any
assessments on the Property are payable in installments, then the
installment for the current period shall be prorated (with Buyer assuming
the obligation to pay any installments due after the Closing Date). If
there shall be any tax certiorari proceeding or tax protest proceeding with
respect to the Property relating to periods prior to or including the
Closing Date, Seller and Buyer shall, from and after the Closing Date,
jointly direct the prosecution of such appeals. After the Closing, at
Buyer's option, Buyer may, subject to Seller's reasonable approval, elect
to change counsel handling such proceedings. Buyer and Seller shall
cooperate with each other in connection with such proceedings and appeals
and collection of a refund of real property taxes paid. This section shall
survive Closing.
(b) RENT AND REVENUES. All Rent, including all
fixed and additional rentals (including any percentage rent, escalations
and pass-throughs of operating and similar expenses) under the Leases, all
parking income and other operating income generated by the Property shall
be prorated in the manner contemplated above. Seller shall deliver or
provide a credit to Buyer on the Closing Date in an amount equal to all
prepaid rentals for periods after the Closing Date and all Security
Deposits (except to the extent the foregoing have been applied or forfeited
prior to the Closing Date in accordance with the terms of the Lease and
such application or forfeiture is not the subject of any dispute or claim
for recovery or misapplication of the same). Rents or other receivables
which are unpaid or delinquent as of the Closing Date shall not be prorated
on the Closing Date (and neither party shall receive any credit therefor on
the Closing Date). Buyer shall include such receivables and other
delinquencies identified on the Closing Date by the parties in its normal
billing and shall use reasonable efforts to pursue the collection thereof
after the Closing Date (but Buyer shall not be required to litigate,
declare a default or otherwise take any action with respect to any lease in
connection therewith). To the extent Buyer actually receives rents or
other charges from delinquent tenants on or after the Closing Date through
the one-year anniversary of the Closing Date, which are attributable to
such tenant's delinquent rent or charges, such payments shall be applied
first toward then current rent and other charges and amounts, both current
and delinquent, owed to Buyer in connection with the applicable lease or
other agreement for which such payments are received, with any remaining
amounts so received to be promptly remitted by Buyer to Seller for
application to such receivables and other delinquencies. With respect to
delinquent rents and any other amounts or other rights of any kind
respecting tenants who are no longer tenants of the Property as of the
Closing Date, Seller shall retain all rights relating thereto.
(c) OPERATING EXPENSES. Subject to the
provisions of subparagraph (d) below, utility charges and other operating
expenses for the Property and contract payments for Contracts Being
Assigned shall be prorated in the manner contemplated above; provided,
however, that Seller shall not receive credit for any prepaid operating
expenses unless the same were for ordinary operations at the Property after
the Closing Date for the benefit of Buyer. To the extent that the amount
of actual consumption of any utility services or the amount of any contract
payment or other expense is not determined prior to the Closing Date, a
proration shall be made at Closing based on the last available reading (as
to utilities) or other reasonable estimates, and post-closing adjustments
between Buyer and Seller shall be made within twenty (20) days of the date
that actual consumption or charges are determined for such pre-closing
period. Seller shall not assign to Buyer any deposits which Seller has
with any of the utility services or companies servicing the Property unless
Buyer, at Buyer's option, shall purchase the deposits at Closing and Seller
shall assign to Buyer all of Seller's right, title and interest in such
deposits.
(d) PASS-THROUGHS. Seller shall pay or credit to
Buyer (on an aggregate good-faith estimated basis at Closing, with a
detailed re-adjustment, if necessary, after Closing as actual amounts
become known and reconciliations with tenants are completed) Excess Seller
Recoveries (as defined below), if any, for each Lease. The "EXCESS SELLER
RECOVERY" for each Lease shall be the amount by which the tenant's payments
to Seller under such Lease on account of common area maintenance charges,
taxes and operating expenses and similar expenses, other than real estate
taxes (collectively, "PASS-THROUGHS") for the calendar year 1997 or other
relevant period prior to the Closing for which Pass-Throughs are determined
under the Lease exceeds the product of (i) Seller's actual out of pocket
costs (or Seller's actual costs in excess (when annualized) of base year
costs or stops for Leases where Pass-Throughs are paid on an escalation
basis) for such period for the items subject to such Pass-Throughs,
multiplied by (ii) such tenant's percentage share of such Pass-Throughs
under such Lease. In addition, Seller shall reimburse Buyer after Closing
if Buyer is required to refund after Closing (pursuant to any Lease) any
overcharge or incorrect charge for operating expenses or taxes or charges
of a similar nature or fixed or percentage rent attributable to the period
of Seller's ownership. If any tenant is required to pay after Closing
(pursuant to any Lease) any underpayment for Pass-Throughs on account of
the landlord's costs being in excess of those upon which estimated tenant
payments on account of Pass-Throughs are based, Buyer shall bill the tenant
therefor and, upon receipt of such payment, application shall be made first
to such tenant's share of the excess landlord costs for the relevant period
incurred by Buyer, and then to such tenant's share of the excess landlord
costs for the relevant period incurred by Seller. Any amounts that may be
due Seller as a result of such re-prorations shall be paid by Buyer to
Seller promptly after Buyer collects such amounts from the tenants, and any
amounts that may be due the tenants as a result of such re-prorations shall
be paid by Seller to Buyer promptly after written request therefor is
delivered to Seller by Buyer (together with reasonably satisfactory
evidence of the amount due the tenants).
(e) LEASING COMMISSIONS AND CONCESSIONS. Seller
shall credit to Buyer an amount equal to all tenant improvement allowances
and leasing commissions with respect to those Leases which are listed in
Exhibit "L-1" which are unpaid as of the Closing Date (and Buyer shall
assume all Seller's obligations regarding such allowances and commissions
to the extent of such credit (the "BUYER CREDITED CONCESSION OBLIGATIONS"),
provided that if such credit is incorrectly calculated at Closing, it shall
be subject to adjustment after Closing, notwithstanding Buyer's assumption
of obligations), and Buyer shall pay to Seller an amount equal to all
tenant allowances and leasing commissions which have been paid by Seller
(and shall assume all obligations regarding tenant allowances and leasing
commissions not paid by Seller (the "SPECIFIED BUYER CONCESSION
OBLIGATIONS")) with respect to those Leases listed in Exhibit "L-2". At
Closing, Buyer shall take subject to (and, except as otherwise set forth on
the closing statement, without credit for) any remaining free or reduced
rent periods specified in any Leases which are then in effect and shall
further assume all obligations regarding any leasing commissions, tenant
improvement allowances (or free or reduced rent or other concessions in
lieu thereof), and any buy-out, finish out, moving, refurbishment, cash
payments to tenants and other concessions or allowances granted to induce a
tenant to enter into a Lease, or expand or renew a Lease or accruing upon
the exercise of any renewals, extensions, expansions or similar rights
regarding the Leases (collectively, the "CONCESSIONS") which are exercised
after the Closing if and to the extent (i) such Concessions (other than
leasing commissions not set forth in the Leases) are expressly provided in
the Lease to accrue upon the exercise after the Closing of any renewal,
extension, expansions or similar rights regarding such Lease, or upon the
occurrence of any date or other event or condition specified in the
relevant Lease which has not occurred prior to Closing, and (ii) as to
leasing commissions not specified in the Leases the same are owed under the
commission agreements described in Exhibit "Q" attached hereto (the
foregoing obligations, together with the Buyer Credited Concession
Obligations and the Specified Buyer Concession Obligations, are
collectively called the "BUYER CONCESSIONS OBLIGATIONS"). Seller shall
remain responsible for any such Concessions which are not Buyer Concession
Obligations (the "SELLER CONCESSIONS OBLIGATIONS").
(f) OPERATING EXPENSES. Unless otherwise
provided herein, any other operating expense or other operating items
pertaining to the Property which are customarily prorated between a buyer
and a seller in New York County shall be prorated according to the custom
relating to such item.
(2) CALCULATION. The prorations and payments required
hereunder shall be made on the basis of a written statement prepared and
approved jointly by Seller and Buyer at or prior to Closing, provided that
each party shall be deemed to have reserved its rights in respect thereof
to the extent and in the event any prorations or apportionments made under
this paragraph 5D shall prove to be incorrect for any reason, in which case
each party shall be entitled to an adjustment to correct the same. Any
item which cannot be finally prorated at Closing because of the
unavailability of information shall be tentatively prorated on the basis of
the best data then available and reprorated when the information is
available. The provisions of this paragraph 5D shall survive the Closing
(and shall not merge therein) until the end of the "Survival Period" (as
hereinafter defined).
6. [RESERVED].
7. REPRESENTATIONS, WARRANTIES AND COVENANTS.
A. REPRESENTATIONS, WARRANTIES AND COVENANTS OF SELLER.
(1) GENERAL DISCLAIMER. Except as specifically set
forth in paragraph 7A(2) below and in the certificates and other
instruments to be delivered by Seller at Closing pursuant to the provisions
of paragraph 5B(1) hereof (collectively, the "CLOSING DOCUMENTS"), the sale
of the Property hereunder is and will be made on an "as is" basis, without
representations and warranties of any kind or nature, express, implied or
otherwise, including, but not limited to, any representation or warranty
concerning title to the Property, the physical condition of the Property
(including, but not limited to, the condition of the soil or the
Improvements or the intrusion of water into the electrical vault at the
Building, any problems with the electrical system at the Building resulting
from or related to such water problems, any structural or physical damage
resulting from or related to such water problems, or any other matters
resulting therefrom or related thereto [the "Water-Electrical Matters"]),
the environmental condition of the Property (including, but not limited to,
the presence or absence of hazardous substances on or respecting the
Property), the compliance of the Property with applicable laws and
regulations (including, but not limited to, zoning and building codes, the
status of development or use rights respecting the Property or matters
relating to variance between record description of the Property and the tax
map description of the Property [the "Description Variance"]), the
financial condition of the Property or any other representation or warranty
respecting any income, expenses, charges, liens or encumbrances, rights or
claims on, affecting or pertaining to the Property or any part thereof.
Buyer acknowledges that, Buyer has examined, reviewed and inspected all
matters which Buyer desires to examine, review or inspect with respect to
the Property. Buyer will acquire the Property on the basis of its own
physical and financial examinations, reviews and inspections and the title
insurance protection afforded by the Owner's Policy, as well as the
representations, warranties, covenants and agreements of Seller contained
herein and in the Closing Documents. Without limitation thereon, Buyer
hereby waives any and all rights of contribution or other rights or
remedies against Seller under the Comprehensive Environmental Response
Compensation and Liability Act or other applicable environmental laws,
rules or regulations. Buyer acknowledges that Buyer is acquiring the
Property subject to the Water-Electrical Matters and, notwithstanding
anything to the contrary contained herein, Buyer waives any and all rights
or remedies against Seller of any kind or nature with respect to the Water-
Electrical Matters or any matter related thereto, including any cost to
repair associated with the Water-Electrical Matters.
(2) LIMITED REPRESENTATIONS AND WARRANTIES OF SELLER.
Subject to the provisions of paragraph 7A(1) above, Seller hereby
represents and warrants that, except as set forth in Exhibit "M" attached
hereto and made a part hereof:
(a) RENT ROLL; LEASES. Attached as Exhibit "N"
and made a part hereof is a true, complete and accurate list, as of the
date thereof, of all Leases. The information concerning the Leases set
forth in Exhibit "O" hereto is true, complete and accurate. Attached as
Exhibit "P" is a listing of Security Deposits (including letters of credit
and other non-cash deposits) held by Seller, which listing has been
prepared in good faith by or on behalf of Seller. The parties acknowledge
that the Closing credit on account of security deposits is being made on
the basis of such list, and that any inaccuracies in such credit on account
of inaccuracies in such list shall be adjusted after Closing as part of the
reproration process contemplated under paragraph 5D above. Except for the
Leases, there are no other leases, occupancy agreements or other
agreements, written or oral, which have entered into by or on behalf of the
owner of the Property granting any person or entity temporary or permanent
rights of possession with respect to the Property. Seller has not received
any written notice of any subleases or assignments executed on the part of
any tenant that has not, to Seller's knowledge, been disclosed in Exhibit
"N". Except as set forth in Exhibit "O", no rent has been paid more than
one (1) month in advance by any tenant under any Lease. Seller has not
received any written notice of default under any of the Leases which
remains uncured. Neither Seller nor, to Seller's knowledge, any other
party is in monetary default under any Leases. Neither Seller nor, to
Seller's knowledge, any other party is in material non-monetary default
under any of the Leases. Seller has, or prior to the Closing Date will
have, completed all tenant improvements and paid for all tenant improvement
allowances, leasing commissions and other Concessions for which monetary
amounts are payable by the landlord under the Leases (except for those set
forth in Exhibit "L-2" hereto or which are Buyer Concessions Obligations).
Except as set forth on Exhibit "Q" attached hereto and made a part hereof,
there are no agreements for the payment of any leasing or brokerage
commissions or fees which will be binding upon Buyer after the Closing or
result in any lien, claim or other right against Buyer's interest in the
Property after Closing. Except as set forth in the Leases or in Exhibits
"L-2" or "O", there are no rent abatements or concessions granted to any
tenants which are applicable to periods from and after the Closing Date.
Seller has delivered to Buyer true, correct and complete copies of the
Leases and the commission agreements identified in Exhibit "Q" hereto.
(b) LITIGATION. There are no actions,
litigation, condemnation or other proceedings against the Property or
against Seller with respect to the Property which are either pending or
which have been threatened in writing.
(c) COMPLIANCE. Seller has not received any
written notice from any governmental authority having jurisdiction over the
Property to the effect that the Property is not in compliance with
applicable laws and ordinances. Seller has not received any written notice
of any existing, proposed or contemplated plans to widen, modify or realign
any street or highway, or any existing or proposed or contemplated eminent
domain proceedings which would affect the Property in any way whatsoever,
or the present use, size, alignment or location of any streets adjacent to
the Property, or any planned public improvements which may be constructed
on the surface of or underneath the streets in the vicinity of the
Building. Seller has not received any written notice of any violation of
any Permitted Exceptions or other matters of record or any written notice
from any tenant or any federal, state or local governmental authority of
any violation or investigation into an alleged violation of or requirement
of compliance with the certificate of occupancy for the Building, any laws,
ordinances, codes, regulations or restrictions, federal, state or local
(including with respect to the Americans with Disabilities Act of 1990, as
amended), affecting the Building or Property (or any portion thereof) which
has not been complied with or of any proposed revocation or suspension of
any certificates of occupancy or other Building permits.
(d) SERVICE AGREEMENTS. Seller has not entered
into any management, maintenance, operating or service contracts,
telecommunications licenses, equipment leases or other contracts of a
similar nature affecting the Property, which will remain in force on and
after the Closing Date, except the Contracts Being Assigned described in
Exhibit "R" attached hereto (or which are otherwise Permitted Exceptions
which will remain in effect on and after the Closing Date). Neither Seller
nor, to Seller's knowledge, any other party is in monetary default or
material non-monetary default under any of the Contracts Being Assigned or
the Permitted Exceptions. Neither Seller nor, to Seller's knowledge,
Manager has received any written notice of default under any of the
Contracts Being Assigned or the Permitted Exceptions which remains uncured.
Seller has heretofore delivered true, correct and complete copies of all
Contracts Being Assigned (including all amendments thereto).
(e) INSURANCE. Attached as Exhibit "S" hereto
and made a part hereof is a true and correct summary of the insurance
coverage maintained by Seller with respect to the Property.
(f) NO EMPLOYEES. There are no employees of
Seller at the Property and Seller is not a party to any labor, union or
collective bargaining agreement with respect to the Property.
(g) DUE AUTHORITY. This Agreement and all
agreements, instruments and documents herein provided to be executed or to
be caused to be executed by Seller are and on the Closing Date will be duly
authorized, executed and delivered by and are binding upon Seller. Seller
is a general partnership, duly organized and validly existing under the
laws of the State of Illinois, and is duly authorized and qualified to do
all things required of it under this Agreement. Seller has the capacity
and authority to enter into this Agreement and consummate the transactions
herein provided. Neither Seller's execution and delivery of this Agreement
nor the performance by Seller of its obligations hereunder will result in
the violation of any law or any provision of the general partnership
agreement of Seller or the articles of incorporation and by-laws of
Seller's general partners or will conflict with any order or decree of any
court or environmental instrumentality of any nature by which Seller is
bound.
(h) ENVIRONMENTAL MATTERS. Except as set forth
in the reports described in Exhibit "T" attached hereto and made a part
hereof (the "ENVIRONMENTAL REPORTS"), Seller has not received written
notice and Seller has no knowledge of and has not caused the existence,
deposit, storage, removal, burial, discharge or release at, on or under the
Property of any material known to Seller to be one or more of the
following: "toxic substances", "toxic materials", "hazardous waste",
"hazardous substances", "pollutants" or "contaminants", as those terms are
defined in the Resource, Conservation and Recovery Act of 1976, as amended
(42 U.S.C. section 6901, et seq.), the Comprehensive Environmental Response
Compensation and Liability Act of 1980, as amended (42 U.S.C. section 9601,
et seq.), the Hazardous Material Transportation Act, as amended (49 U.S.C.
section 1801, et seq.), the Toxic Substances Control Act of 1976, as
amended (15 U.S.C. section 2601, et seq.), the Clean Air Act, as amended
(42 U.S.C. section 1251, et seq.) and any other federal, state or local
law, statute, ordinance, rule, regulation, code, order, approval, policy
and authorization relating to health, safety or the environment, to the
extent any of the foregoing are in effect as of the date hereof (said laws
being hereafter referred to collectively as "ENVIRONMENTAL LAWS"); asbestos
or asbestos-containing materials; oils; petroleum-derived compounds,
pesticides; or polychlorinated biphenyls (all of which are hereafter
collectively referred to as "HAZARDOUS MATERIALS"). Seller has not
received any written complaint, order, citation or notice from any
governmental authority with regard to any violations of Environmental Laws
regarding air emissions, water discharges, noise emissions, and Hazardous
Materials, if any, or any other environmental, health or safety matters
affecting the Property, or any part thereof. The foregoing representations
and warranties do not cover the presence of Excluded Materials (hereafter
defined) from whatever the source on, in or under the Property. "Excluded
Materials" shall mean Hazardous Materials (i) other than asbestos or
asbestos-containing materials, whose storage, disposal or presence on, in
or under any part of the Property does not constitute a violation of the
Environmental Laws, or (ii) which may be present in (a) paints (other than
lead-based paints), glues, fuels, photocopy equipment supplies, janitorial
supplies, cleaning agents and solvents, or (b) inventory held for sale at
retail by tenants or (iii) in quantities commonly stored, found or
maintained for similar uses in office buildings of a similar nature.
Except as may otherwise be set forth in the Environmental Reports, to
Seller's knowledge, the Property has never been used as a chemical burying
site, no Hazardous Materials have been buried or deposited on the site, and
no unclean landfill has been used on the site. Except as may otherwise be
set forth in the Environmental Reports, to Seller's knowledge, the Property
does not contain any underground storage or treatment tanks, active or
abandoned water, gas or oil wells.
(i) OPERATING STATEMENTS. The operating
statements delivered to Buyer relating to the Property for years 1994,
1995, 1996 and partial year 1997 were prepared in good faith in the
ordinary course of Seller's business (and are used by Seller for reporting
to the partners of Seller, for determining such partners' distributions,
for calculating Pass-Throughs, and for preparation of Seller's tax
returns).
(j) NO OTHER AGREEMENTS; NO DEFAULTS. Except for
the Leases, the Contracts Being Assigned and any Permitted Exceptions which
will remain in effect on and after the Closing Date (collectively, the
"PROPERTY AGREEMENTS"), Seller has not entered into, and Seller has no
knowledge of, any agreements with respect to the Property which will be
binding upon Buyer after the Closing or result in any lien or, claim
against Buyer's interest in the Property after Closing. Seller is not in
monetary default nor material non-monetary default with respect to the
Property Agreements. Seller has not received any notice of default under
any of the Property Agreements which remains uncured.
(k) PERSONAL PROPERTY. The Personal Property is
on-site at the Property and is free and clear of liens and encumbrances
other than the Permitted Exceptions. Seller shall convey the Personal
Property "as is" with all its faults, and without any warranty of any kind
or nature, including, without limitation, any warranty of merchantability,
fitness for a particular purpose, or warranty against any patent, trademark
or copyright infringements.
(l) TAXES. Seller has delivered to Buyer true
and correct copies of all tax bills payable in connection with the Property
for the current tax year. Seller has not received any written notice of any
proposed assessments on the Property.
(m) NO OPTIONS. Seller has not granted any right
of first refusal, purchase option, redemption right or other similar
acquisition rights to any tenant or any other party which would prevent
Seller from completing the transfer of the Property in the manner
contemplated herein or which would bind Buyer subsequent to the Closing
("EXISTING OPTIONS"). Seller has not entered into any currently effective
agreement to sell or dispose of all of its interests in and to the Property
(except for this Agreement).
(n) BANKRUPTCY. Seller has not commenced a
voluntary case, nor has there been commenced against Seller , an
involuntary case, nor has Seller consented to the appointment of a
"Custodian" of it or for all or any substantial part of its property, nor
has a court of competent jurisdiction entered an order or decree under any
applicable "Bankruptcy Law" that it is for relief against Seller in an
involuntary case or appoints a Custodian for Seller or for all or any
substantial part of its property. The term "BANKRUPTCY LAW" means Title
11, U.S. Code, or any similar federal or state law for the relief of
debtors. The term "CUSTODIAN" means any receiver, trustee, assignee,
liquidator or similar official under any Bankruptcy Law.
(o) NO LATENT DEFECTS. To Seller's knowledge,
there are no "latent defects" with respect to the Building (except to the
extent related to the Water-Electrical Matters). As used herein, "latent
defects" means material defects to the structural integrity of the Building
which are known to Seller and which could not have been discovered by a
prudent buyer diligently inspecting the Building (such inspections
including engaging reputable and appropriate professionals to conduct
engineering and structural inspections, reviews and examinations of the
Building and the Parking Structure). Seller acknowledges that, based on
information supplied by Buyer to Seller, Buyer's engineering and structural
inspections, reviews and examinations satisfy the foregoing prudent buyer
standard. Without limitation on the other limitations on, or waivers of,
liability contained herein, nothing contained herein shall impose any
liability on Seller with respect to the Water-Electrical Matters (Buyer
acquiring the Property subject to the same).
(p) CERTAIN PHYSICAL REPORTS. To Seller's
knowledge, Seller has delivered or otherwise made available to Buyer all
third party roofing reports, and all reports relating to capital repairs
made to the Property, to the extent the same are in Seller's possession or
control.
(q) DEFINITION OF SELLER'S KNOWLEDGE. As used
herein, the term "SELLER'S KNOWLEDGE" or any term referring to the
knowledge of Seller shall mean the present actual knowledge of Douglas
Welker of JMB Realty Corporation, the partnership coordinator overseeing
Seller's investment in the Property and the person within Seller's
organization most familiar with the Property (after consulting with the on-
site property manager and leasing agent for Seller's third party property
management company and having them review the representations and
warranties contained herein, but otherwise without any duty to investigate
and with any imputed or constructive knowledge being excluded).
B. REPRESENTATIONS AND WARRANTIES OF BUYER. Buyer hereby
represents and warrants that this Agreement and all agreements, instruments
and documents herein provided to be executed or to be caused to be executed
by Buyer are and on the Closing Date will be duly authorized, executed and
delivered by and are binding upon Buyer; Buyer is a corporation, duly
organized and validly existing and in good standing under the laws of the
State of Delaware, and is duly authorized and qualified to do all things
required of it under this Agreement; and Buyer has the capacity and
authority to enter into this Agreement and consummate the transactions
herein provided; and neither Buyer's execution and delivery of this
Agreement nor the performance by Buyer of its obligations hereunder will
result in the violation of any law or any provision of the limited
partnership agreement of Buyer or the articles of incorporation and by-laws
of Buyer's general partners or will conflict with any order or decree of
any court or environmental instrumentality of any nature by which Buyer is
bound.
C. SURVIVAL. Any cause of action of Buyer for a breach of
the representations and warranties of Seller contained in this Agreement
shall survive until December 1, 1998 ("SURVIVAL PERIOD"), and (unless
written notice setting forth a claim therefor with specificity shall have
been delivered by Buyer to Seller on or before December 1, 1998, and
litigation respecting the same commenced not later than December 31, 1998)
such representations and warranties, and any cause of action resulting from
a breach thereof not then in litigation, shall thereupon terminate.
Notwithstanding the foregoing, if Buyer shall have actual knowledge as of
the Closing Date that any of the representations or warranties of Seller
contained herein are false or inaccurate or that Seller is in breach or
default of any of its obligations under this Agreement, and Buyer
nonetheless closes the transactions hereunder and acquires the Property,
then Seller shall have no liability or obligation respecting such false or
inaccurate representations or warranties or other breach or default (and
any cause of action resulting therefrom shall terminate upon such closing
hereunder); provided, however, nothing contained in the foregoing shall
limit or release Seller's liability hereunder with respect to its proration
and reproration obligations. As used herein, the term "BUYER'S KNOWLEDGE"
(or any term referring to the knowledge of Buyer) shall mean the present
actual knowledge of Brad Child. With respect to the foregoing, Buyer shall
be deemed to have actual knowledge of the information contained in any and
all written reports or studies prepared by or on behalf of Buyer in
connection with its due diligence reviews, inspections and examinations of
the Property.
INDEMNIFICATION.
BY BUYER. Buyer shall hold harmless, indemnify and defend
Seller from and against: (1) any and all third party claims for personal
injury or property damage caused by Buyer's torts related to the Property
and occurring on or after the Closing Date, and (2) all costs and expenses,
including reasonable attorney's fees, incurred by Seller as a result of the
foregoing.
BY SELLER. Seller shall hold harmless, indemnify and defend
Buyer from and against: (1) any and all third party claims for personal
injury or property damage caused by Seller's torts related to the Property
and occurring prior to the Closing Date; and (2) all costs and expenses,
including reasonable attorney's fees, incurred by the Buyer as a result of
such claims.
GENERALLY. Each indemnification under this Agreement shall be
subject to the following provisions: The indemnitee shall notify
indemnitor of any such claim against indemnitee within 30 days after it has
notice of such claim, but failure to notify indemnitor shall in no case
prejudice the rights of indemnitee under this Agreement unless indemnitor
shall be prejudiced by such failure and then only to the extent of such
prejudice. Should indemnitor fail to discharge or undertake to defend
indemnitee against such liability within 10 days after the indemnitee gives
the indemnitor written notice of the same, then indemnitee may settle such
liability, and indemnitor's liability to indemnitee shall be conclusively
established by such settlement, the amount of such liability to include
both the settlement consideration and the reasonable costs and expenses,
including attorneys' fees, incurred by indemnitee in effecting such
settlement.
9. PRE-CLOSING REMEDIES; TERMINATION. Notwithstanding anything to
the contrary contained in this Agreement, neither party shall be obligated
to close the transactions contemplated hereby and either Seller or Buyer
may at its option and in its sole discretion terminate this Agreement at
any time prior to Closing. If the transactions herein provided shall not
be closed for any reason, whether resulting from a failure of a condition
set forth herein or by reason of a default or breach by Seller or Buyer
hereunder, the sole right or remedy of either party hereto as a result of
such failure to close shall be to terminate this Agreement. In no event
shall any action for specific performance, for damages or otherwise be
permitted as a result of any failure to close the transactions hereunder
(and in no event shall any LIS PENDENS or other notice of lawsuit or claim
upon the Property be pled in connection therewith). Nothing contained
herein shall limit any rights a party may have to indemnification pursuant
to paragraphs 4B(2) and 10A hereof. In addition, nothing contained in this
paragraph 9 is intended to limit the rights or remedies of the parties from
and after the Closing, if the same shall have occurred hereunder (the
parties hereto agreeing, however, that following such Closing, no right to
terminate this Agreement and no right of recision shall be available to
either party).
10. MISCELLANEOUS.
A. BROKERS.
(1) Except as provided in subparagraph (2) below,
Seller represents and warrants to Buyer, and Buyer represents and warrants
to Seller, that no broker or finder has been engaged by it, respectively,
in connection with any of the transactions contemplated by this Agreement
or to its knowledge is in any way connected with any of such transactions.
In the event of a claim for broker's or finder's fee or commissions in
connection herewith, then Seller shall indemnify and defend Buyer from the
same if it shall be based upon any statement or agreement alleged to have
been made by Seller, and Buyer shall indemnify and defend Seller from the
same if it shall be based upon any statement or agreement alleged to have
been made by Buyer. The indemnification obligations under this paragraph
10 A(1) shall survive the closing of the transactions hereunder or the
earlier termination of this Agreement.
(2) If and only if the sale contemplated herein closes,
Seller agrees to pay a brokerage commission to Richard Ellis, LLC (the
"BROKER") pursuant to a separate written agreement between Seller and
Broker. Buyer shall have no liability or obligation for any commissions
which may be owed to the Broker.
B. LIMITATION OF LIABILITY.
(1) Notwithstanding anything to the contrary contained
herein, if the closing of the transactions hereunder shall have occurred
(and Buyer shall not have waived, relinquished or released in writing any
applicable rights in further limitation), the aggregate liability of Seller
to Buyer (or anyone claiming by, through or under Buyer or any successor or
assign of Buyer) arising pursuant to or in connection with the
representations, warranties, indemnifications, covenants or other
obligations (whether express or implied) of Seller under this Agreement (or
any document executed or delivered in connection herewith) or otherwise in
connection with the Property (the "SPECIFIED LIABILITIES") shall be limited
to actual damages (including reasonable attorneys' fees,) and shall in no
event exceed $1,500,000 in the aggregate.
(2) In no event shall Seller have any liability
pursuant to or in connection with the Specified Liabilities unless and
until such Specified Liabilities shall exceed $25,000 in the aggregate;
provided, however, nothing contained in the foregoing shall limit Seller's
liability for any proration amounts provided for in paragraph 5D of this
Agreement.
(3) No constituent partner in or agent of Seller, nor
any advisor, trustee, director, officer, employee, beneficiary,
shareholder, participant, representative or agent of any corporation or
trust that is or becomes a constituent partner in Seller (including, but
not limited to, JMB Realty Corporation) shall have any personal liability,
directly or indirectly, under or in connection with this Agreement or any
agreement made or entered into under or pursuant to the provisions of this
Agreement, or any amendment or amendments to any of the foregoing made at
any time or times, heretofore or hereafter, and Buyer and its successors
and assigns and, without limitation, all other persons and entities, shall
have recourse solely limited to Seller's assets for the payment of any
claim or for any performance, and Buyer, on behalf of itself and its
successors and assigns, hereby waives any and all such personal liability.
Notwithstanding anything to the contrary contained in this Agreement,
neither the negative capital account of any constituent partner in Seller
(or in any other constituent partner of Seller), nor any obligation of any
constituent partner in Seller (or in any other constituent partner of
Seller) to restore a negative capital account or to contribute capital to
Seller (or to any other constituent partner of Seller), shall at any time
be deemed to be the property or an asset of Seller or any such other
constituent partner (and neither Buyer nor any of its successors or assigns
shall have any right to collect, enforce or proceed against or with respect
to any such negative capital account of partner's obligation to restore or
contribute).
(4) Notwithstanding the foregoing, (i) if Seller or its
successor-in-interest shall fail to retain unencumbered reserves of at
least $1,500,000 at the time of closing hereunder or (ii) if during the
period commencing on the Closing Date and ending on the expiration of the
Survival Period, Seller or its successor-in-interest shall utilize such
reserves for any purpose other than the payment of claims, expenses,
liabilities or attorneys' fees of Seller or such successor-in-interest
(including any amounts incurred in connection with resolving or defending
any claim of liability hereunder) with respect to the Specified
Liabilities, then subject to the terms and conditions of this Agreement,
Buyer may, during the Survival Period, have recourse to the assets of JMB
Realty Corporation ("JMB"), as the general partner or the general partners
of Seller, for the payment of any Specified Liabilities and, by signing
this Agreement JMB acknowledges that, subject to the provisions hereinafter
set forth, JMB shall be liable for the Specified Liabilities; provided,
however, the aggregate liability of JMB in connection therewith shall not
exceed $1,500,000 in the aggregate and shall be further limited as follows:
(i) with respect to the initial reserve amount at
the time of Closing hereunder, such liability shall be limited to the
lesser of the amount by which $1,500,000 exceeds the amount actually
reserved by Seller or its successor-in-interest in closing hereunder, and
$1,500,000; or
(ii) during the Survival Period, such liability
shall be limited to the lesser of the amount of such reserves which, during
the Survival Period, are utilized for purposes other than the payment of
the Specified Liabilities, and $1,500,000.
Without limitation on the other limitations on, or waivers of, liability
contained herein, JMB shall have no liability or obligation with respect to
the Water-Electrical Matters (Buyer acquiring the Property subject to the
same).
C. ENTIRE AGREEMENT. This Agreement contains the entire
agreement between the parties respecting the matters herein set forth and
supersedes all prior agreements between the parties hereto respecting such
matters. This Agreement may not be modified or amended except by written
agreement signed by both parties.
D. TIME OF THE ESSENCE. Time is of the essence of this
Agreement.
E. INTERPRETATION. Paragraph headings shall not be used in
construing this Agreement. Each party acknowledges that such party and its
counsel, after negotiation and consultation, have reviewed and revised this
Agreement. As such, the terms of this Agreement shall be fairly construed
and the usual rule of construction, to the effect that any ambiguities
herein should be resolved against the drafting party, shall not be employed
in the interpretation of this Agreement or any amendments, modifications or
exhibits hereto or thereto.
F. GOVERNING LAW. This Agreement shall be construed and
enforced in accordance with the laws of the State of New York.
G. SUCCESSORS AND ASSIGNS. This Agreement and the terms and
provisions hereof shall inure to the benefit of and be binding upon the
successors and assigns of the parties.
H. NOTICES. Any notice which a party is required or may
desire to give the other shall be in writing and shall be sent by personal
delivery or by mail (either [i] by United States registered or certified
mail, return receipt requested, postage prepaid, or [ii] by Federal Express
or similar generally recognized overnight carrier regularly providing proof
of delivery), addressed as
<PAGE>
follows (subject to the right of a party to designate a different address
for itself by notice similarly given):
TO BUYER:
c/o GSIC Realty Corporation
255 Shoreline Drive, Suite 600
Redwood City, California 94065
Attention: Mr. Brad Child
WITH COPY TO:
Sidley & Austin
875 Third Avenue
New York, New York 10022
Attention: Andrew R. Berman, Esq.
TO SELLER:
c/o JMB Realty Corporation
900 North Michigan Avenue
19th Floor
Chicago, Illinois 60611
Attention: Mr. Glenn Emig
WITH COPIES TO:
Pircher, Nichols & Meeks
1999 Avenue of the Stars
Suite 2600
Los Angeles, California 90067
Attention: Real Estate Notices (GML)
AND TO:
Richard Ellis, LLC
Three First National Plaza
Chicago, Illinois 60602
Attention: Mr. Larry Vogler
Any notice so given by mail shall be deemed to have been given as of the
date of delivery (whether accepted or refused) established by U.S. Post
Office return receipt or the overnight carrier's proof of delivery, as the
case may be. Any such notice not so given shall be deemed given upon
receipt of the same by the party to whom the same is to be given.
I. LEGAL COSTS. The parties hereto agree that they shall
pay directly any and all legal costs which they have incurred on their own
behalf in the preparation of this Agreement, all deeds and other agreements
pertaining to this transaction and that such legal costs shall not be part
of the closing costs. In addition, if either Buyer or Seller brings any
suit or other proceeding with respect to the subject matter or the
enforcement of this Agreement, the prevailing party (as determined by the
court, agency or other authority before which such suit or proceeding is
commenced), in addition to such other relief as may be awarded, shall be
entitled to recover reasonable attorneys' fees, expenses and costs of
investigation actually incurred. The foregoing includes, but is not
limited to, attorneys' fees, expenses and costs of investigation
(including, without limitation, those incurred in appellate proceedings),
costs incurred in establishing the right to indemnification, or in any
action or participation in, or in connection with, any case or proceeding
under Chapter 7, 11 or 13 of the Bankruptcy Code (11 United States Code
Sections 101 et seq.), or any successor statutes.
J. FURTHER ASSURANCES. Each party agrees that it will,
without further consideration, execute and deliver such other documents and
take such other action, whether prior or subsequent to the Closing, as may
be reasonably requested by the other party to consummate more effectively
the purposes or subject matter of this Agreement; provided, however, that
neither Seller nor Buyer shall be obligated to incur any obligations or
material expenses except as otherwise required hereunder. The provisions
of this Paragraph shall survive the Closing until the expiration of the
Survival Period.
K. COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original, but all of
which shall constitute one and the same document.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the date first above written.
JMB-40 BROAD STREET ASSOCIATES,
an Illinois general partnership
By: JMB INCOME PROPERTIES, LTD.,-XII,
an Illinois limited partnership,
General Partner
By: JMB REALTY CORPORATION,
a Delaware corporation,
Corporate General Partner
By: _________________________
Name: _________________________
Title:_________________________
"Seller"
40 BROAD DELAWARE, INC.,
a Delaware corporation
By: _____________________________________
Name: _____________________________________
Title:_____________________________________
By: _____________________________________
Name: _____________________________________
Title:_____________________________________
"Buyer"
<PAGE>
EXHIBIT LIST
"A" - PROPERTY DESCRIPTION
"B" - PERSONAL PROPERTY
"C" - FORM OF OWNER'S POLICY
"D" - LIST OF REQUIRED TENANTS
"E" - FORM OF TENANT ESTOPPEL CERTIFICATE
"F" - FORM OF DEED
"G" - FORM OF TENANT LEASE ASSIGNMENT AND
ASSUMPTION
"H" - FORM OF GENERAL ASSIGNMENT AND ASSUMPTION
"I" - FORM OF BILL OF SALE
"J" - [INTENTIONALLY DELETED]
"K" - [INTENTIONALLY DELETED]
"L-1"- SELLER'S TI/LEASING COMMISSION OBLIGATIONS
"L-2"- BUYER'S TI/LEASING COMMISSION OBLIGATIONS
"M" - EXCEPTIONS TO SELLER'S REPRESENTATIONS AND
WARRANTIES
"N" - LIST OF LEASES (AND SUBLEASES OR ASSIGNMENTS)
"O" - RENT ROLL
"P" - LIST OF SECURITY DEPOSITS
"Q" - LEASING COMMISSION AGREEMENTS
"R" - CONTRACTS BEING ASSIGNED (INCLUDING SERVICE
AGREEMENTS AND PARKING AGREEMENTS AND LEASES)
"S" - INSURANCE COVERAGE SUMMARY
"T" - ENVIRONMENTAL REPORTS
<PAGE>
NEW YORK BARGAIN AND SALE DEED
THIS INDENTURE is made this ____ day of December, 1997, by and
between JMB-40 BROAD STREET ASSOCIATES, an Illinois general partnership,
having an address at c/o JMB Realty Corporation, 900 North Michigan Avenue,
Chicago, Illinois 60611, the Grantor, and 40 BROAD DELAWARE, INC., a
Delaware corporation, having an address at c/o GSIC Realty Corporation, 255
Shoreline Drive, Suite 600, Redwood City, California 94065, the Grantee.
WITNESSETH, that the Grantor, in consideration of Ten and No/100
Dollars, and other valuable consideration paid by the Grantee, does hereby
grant and release unto the Grantee, the heirs or successors and assigns of
the Grantee forever,
ALL that certain plot, piece or parcel of land, with the buildings
and improvements thereon erected, situate, lying and being in the City of
New York, County of New York, State of New York, and more particularly
described in Exhibit "A", hereunto annexed and made a part hereof, subject
to those liens, encumbrances, easements, covenants, conditions,
restrictions and other matters disclosed on Exhibit "B", hereunto annexed
and made a part hereof.
TOGETHER with all right, title and interest, if any, of the Grantor
in and to any streets and roads abutting the above described premises to
the center lines thereof; TOGETHER with the appurtenances and all the
estate and rights of the Grantor in and to said premises; TO HAVE AND TO
HOLD the premises herein granted unto the Grantee, the heirs or successors
and assigns of the Grantee forever.
AND the Grantor covenants with the Grantee, that Grantor has done
nothing to impair such title as Grantor received, and Grantor will warrant
and defend the title against the lawful claims of all persons claiming by,
under or through Grantor (but not otherwise).
AND the Grantor, in compliance with Section 13 of the Lien Law,
covenants that the Grantor will receive the consideration for this
conveyance and will hold the right to receive such consideration as a trust
fund to be applied first for the purpose of paying the costs of the
improvements and will apply the same first to the payment of the cost of
the improvements before using any part of the total of the same for any
other purpose.
The word "party" shall be construed as if it read "parties" whenever
the sense of this indenture so requires.
IN WITNESS WHEREOF, the party of the first part has duly executed
this deed the day and year first above written.
In presence of: JMB-40 BROAD STREET ASSOCIATES,
an Illinois general partnership
By: JMB INCOME PROPERTIES, LTD.,-XII,
an Illinois limited partnership,
General Partner
By: JMB REALTY CORPORATION,
a Delaware corporation,
Corporate General Partner
ATTEST:
_____________________________ By: _____________________
Assistant Secretary Its: _____________________
[CORPORATE SEAL]
<PAGE>
STATE OF ILLINOIS )
) SS.
COUNTY OF COOK )
On the ___ day of December in the year 1997 before me personally came
______________________ to me known, who, being by me duly sworn, did depose
and say that he/she resides at _____________________________________; that
he/she is the ___________________________ of JMB Realty Corporation, a
Delaware corporation, the corporation described in and which executed the
above instrument; and that he/she signed his/her name thereto by authority
of the board of directors of said corporation.
___________________________________
Notary Public, State of Illinois
My commission expires: ___________
<PAGE>
STATE OF ILLINOIS )
) SS.
COUNTY OF COOK )
On the ___ day of December in the year 1997 before me personally came
______________________ to me known, who, being by me duly sworn, did depose
and say that he/she resides at _____________________________________; that
he/she is the ___________________________ of JMB Realty Corporation, a
Delaware corporation, the corporation described in and which executed the
above instrument in its capacity as the Corporate General Partner of JMB
Income Properties, Ltd., -XII, an Illinois general partnership, which is
the General Partner of JMB-40 Broad Street Associates, an Illinois general
partnership; and that he/she signed his/her name thereto by authority of
the board of directors of said corporation.
___________________________________
Notary Public, State of Illinois
My commission expires: ___________
<PAGE>
TENANT LEASE ASSIGNMENT AND ASSUMPTION
(40 Broad Street; New York, New York)
FOR VALUABLE CONSIDERATION, receipt of which is hereby acknowledged,
the undersigned, JMB-40 BROAD STREET ASSOCIATES, an Illinois general
partnership ("SELLER"), hereby sells, transfers, assigns and conveys to 40
BROAD DELAWARE, INC., a Delaware corporation ("BUYER"), all right, title
and interest of the landlord in and to all Leases respecting the "Property"
(as such terms are defined in that certain Purchase Agreement (the
"PURCHASE AGREEMENT") dated as of December ___, 1997, between the Seller
and Buyer, providing for, among other things, the purchase and sale of that
certain office building located in New York, New York, commonly known as
"40 Broad Street", including those leases described in Exhibit "A" attached
hereto, all underlying agreements, correspondence, work letters, guarantees
of lease and other agreements, if any, relating to the Leases, all claims
under the Leases, and all Security Deposits and Rents and all lease offers
and options relating to the foregoing (provided that, subject to Section
5D(1)(b) of the Purchase Agreement, Seller shall not hereby be deemed to
have waived or released any party from any rights to indemnification or any
defenses, counterclaims or other similar claims with respect to pre-closing
occurrences).
The parties hereto agree and acknowledge that this Agreement
constitutes a present assignment of Seller's right, title and interest in,
to and under the Leases, Security Deposits and Rents, but not Seller's
obligations or liabilities under the Leases, Security Deposits and Rents,
in each case, accruing or occurring prior to the date hereof, except as
otherwise provided for in the Purchase Agreement.
This Assignment shall be binding upon and inure to the benefit of
Seller and Buyer and their respective successors and assigns.
This Tenant Lease Assignment and Assumption is given pursuant to the
Purchase Agreement. The covenants, agreements, and limitations (including,
but not limited to, the limitations of liability provided in Paragraph 10B
of the Purchase Agreement) provided in the Purchase Agreement with respect
to the property conveyed hereunder are hereby incorporated herein by this
reference as if herein set out in full and shall inure to the benefit of
and shall be binding upon Seller and Buyer, and their respective successors
and assigns. The property conveyed hereunder is conveyed "as is" without
warranty or representation, except as expressly provided in (and subject to
the limitations of) the Purchase Agreement.
This Tenant Lease Assignment and Assumption may be executed in
counterparts, each of which shall be deemed an original, but all of which
taken together shall constitute one and the same instrument.
Seller agrees that it will at any time and from time to time, upon
the reasonable request of Buyer, its successors and assigns, do, execute,
acknowledge and deliver all such future instruments and documents to
further and more fully carry out the purposes of this instrument (provided
the foregoing obligations do not materially increase the costs to, or
liability or obligation of, Seller in a manner not otherwise provided in
the Purchase Agreement).
Buyer hereby accepts delivery of the foregoing Tenant Lease
Assignment and Assumption and agrees to assume and discharge, in accordance
with the terms thereof, all of the burdens and obligations of Seller under
the Leases, to the extent the same arise from and after the date hereof and
are not the responsibility of the Seller under the provisions of the
Purchase Agreement, including, but not limited to, the provisions of
Section 5D of the Purchase Agreement; however, the foregoing shall not
limit Buyer's obligations under Section 5D of the Purchase Agreement.
Buyer agrees that it will at any time and from time to time, upon the
reasonable request of Seller, its successors and assigns, do, execute,
acknowledge and deliver all such future instruments and documents to
further and more fully carry out the purposes of this instrument (provided
the foregoing obligations do not materially increase the costs to, or
liability or obligation of, Seller in a manner not otherwise provided in
the Purchase Agreement).
DATED: As of December ___, 1997.
JMB-40 BROAD STREET ASSOCIATES,
an Illinois general partnership
By: JMB INCOME PROPERTIES, LTD.,-XII,
an Illinois limited partnership,
General Partner
By: JMB REALTY CORPORATION,
a Delaware corporation,
Corporate General Partner
By: __________________________
Name: ________________________
Title: ________________________
40 BROAD DELAWARE, INC.,
a Delaware corporation
By: __________________________
Name: ________________________
Title: _______________________
By: _________________________
Name: _________________________
Title: _______________________
<PAGE>
GENERAL ASSIGNMENT AND ASSUMPTION
(40 Broad Street; New York, New York)
FOR VALUABLE CONSIDERATION, receipt of which is hereby acknowledged,
the undersigned, JMB-40 BROAD STREET ASSOCIATES, an Illinois general
partnership ("SELLER"), hereby sells, transfers, assigns and conveys to 40
BROAD DELAWARE, INC., a Delaware corporation ("BUYER"), the following:
All right, title and interest of Seller in and to the
"Contracts Being Assigned" (as defined in the Purchase Agreement described
below), which Contracts Being Assigned are further described in Exhibit "A"
attached hereto and incorporated herein by this reference, and all claims
thereunder (provided that, subject to Section 5D(1)(b) of the Purchase
Agreement, Seller shall not hereby be deemed to have waived or released any
party from any rights to indemnification or any defenses, counterclaims or
other similar claims with respect to pre-closing occurrences); and
All right, title and interest of Seller in and to the "Real
Property," the "Building," "Other Property Rights," or "Personal Property"
(as such terms are defined in that certain Purchase Agreement ["PURCHASE
AGREEMENT"] dated as of December ___, 1997, between the Seller and Buyer,
providing for, among other things, the purchase and sale of that certain
office building located in New York, New York, commonly known as "40 Broad
Street"), including, without limitation, all licenses, certificates of
occupancy, permits, consents, approvals and other written authorizations
necessary for the use, operation or ownership of the Real Property or
Personal Property.
This General Assignment and Assumption is given pursuant to the
Purchase Agreement. The covenants, agreements, and limitations (including,
but not limited to, the limitations of liability provided in Paragraph 10B
of the Purchase Agreement) provided in the Purchase Agreement with respect
to the property conveyed hereunder are hereby incorporated herein by this
reference as if herein set out in full and shall inure to the benefit of
and shall be binding upon Seller and Buyer, and their respective successors
and assigns. The property conveyed hereunder is conveyed "as is" without
warranty or representation, except as expressly provided in (and subject to
the limitations of) the Purchase Agreement.
The parties hereto agree and acknowledge that this Agreement
constitutes a present assignment of Seller's right, title and interest in,
to and under the Contracts Being Assigned, the Real Property, the Building,
the Other Property Rights, the Personal Property and the other Property
described in the Purchase Agreement, but not Seller's obligations or
liabilities under the assignment of Seller's right, title and interest in,
to and under the Contracts Being Assigned, the Real Property, the Building,
the Other Property Rights, the Personal Property and the other Property
described in the Purchase Agreement, in each case, accruing or occurring
prior to the date hereof, except as otherwise provide for in the Purchase
Agreement.
This Assignment shall be binding upon and inure to the benefit of
Seller and Buyer and their respective successors and assigns.
This General Assignment and Assumption may be executed in
counterparts, each of which shall be deemed an original, but all of which
taken together shall constitute one and the same instrument.
Seller agrees that it will at any time and from time to time, upon
the reasonable request of Buyer, its successors and assigns, do, execute,
acknowledge and deliver all such future instruments and documents to
further and more fully carry out the purposes of this instrument (provided
the foregoing obligations do not materially increase the costs to, or
liability or obligation of, Seller in a manner not otherwise provided in
the Purchase Agreement).
Buyer hereby accepts delivery of the foregoing General Assignment and
Assumption and agrees to assume and discharge, in accordance with the terms
thereof, all of the burdens and obligations of Seller under the Contracts
Being Assigned, to the extent the same arise from and after the date hereof
and are not the responsibility of the Seller under the provisions of the
Purchase Agreement, including, but not limited to, the provisions of
Section 5D of the Purchase Agreement; however, the foregoing shall not
limit Buyer's obligations under Section 5D of the Purchase Agreement.
Buyer agrees that it will at any time and from time to time, upon the
reasonable request of Seller, its successors and assigns, do, execute,
acknowledge and deliver all such future instruments and documents to
further and more fully carry out the purposes of this instrument
<PAGE>
(provided the foregoing obligations do not materially increase the costs
to, or liability or obligation of, Seller in a manner not otherwise
provided in the Purchase Agreement).
DATED: As of December ___, 1997.
JMB-40 BROAD STREET ASSOCIATES,
an Illinois general partnership
By: JMB INCOME PROPERTIES, LTD.,-XII,
an Illinois limited partnership,
General Partner
By: JMB REALTY CORPORATION,
a Delaware corporation,
Corporate General Partner
By: ____________________________
Name: ___________________________
Title: ___________________________
40 BROAD DELAWARE, INC.,
a Delaware corporation
By:_________________________________
Name: ______________________________
Title: _____________________________
By:_________________________________
Name: ______________________________
Title: _____________________________
<PAGE>
EXHIBIT "A"
(See Attached)
<PAGE>
BILL OF SALE
(40 Broad Street; New York, New York)
FOR VALUABLE CONSIDERATION, receipt of which is hereby acknowledged,
the undersigned, JMB-40 BROAD STREET ASSOCIATES, an Illinois general
partnership ("SELLER"), hereby sells, transfers, assigns and conveys to 40
BROAD DELAWARE, INC., a Delaware corporation ("BUYER"), all right, title
and interest of Seller in and to (i) those items of tangible "Personal
Property" (as defined in the Purchase Agreement described below), which
tangible Personal Property is further described in Exhibit "A" attached
hereto and made a part hereof, and all other tangible personal property
located on the "Real Property" (as such term is defined in that certain
Purchase Agreement ["PURCHASE AGREEMENT"] dated as of December ___, 1997,
between the Seller and Buyer, providing for, among other things, the
purchase and sale of that certain office center located in New York, New
York, commonly known as "40 Broad Street") and used in the ownership,
operation and maintenance of the "Property" (as defined in the Purchase
Agreement), including, without limitation, all furniture, furnishings,
fixtures, appliances, machinery and equipment owned by Seller (provided,
however, the foregoing does not include any proprietary software items),
and (ii) all intangible property relating to the Property, including,
without limitation, any and all rights of Seller in and to the name "40
Broad Street," all plans and specifications for the Property, all third
party engineering, soils, curtain wall and hazardous reports and studies
relating to the Property, all catalogues, warranties, guarantees,
correspondence with present or prospective tenants or suppliers and non-
proprietary books, records and files relating to the condition or
operations of the Property.
This Assignment shall be binding upon and inure to the benefit of
Seller and Buyer and their respective successors and assigns.
This Bill of Sale is given pursuant to the Purchase Agreement. The
covenants, agreements, and limitations (including, but not limited to, the
limitations of liability provided in paragraph 10B of the Purchase
Agreement) provided in the Purchase Agreement with respect to the property
conveyed hereunder are hereby incorporated herein by this reference as if
herein set out in full and shall inure to the benefit of and shall be
binding upon Seller and Buyer, and their respective successors and assigns.
Said property is conveyed "as is" without warranty or representation,
except as expressly provided in (and subject to the limitations of) the
Purchase Agreement.
DATED: As of December ___, 1997.
JMB-40 BROAD STREET ASSOCIATES,
an Illinois general partnership
By: JMB INCOME PROPERTIES, LTD.,-XII,
an Illinois limited partnership,
General Partner
By: JMB REALTY CORPORATION,
a Delaware corporation,
Corporate General Partner
By: _____________________________
Name: ___________________________
Title: ___________________________
<PAGE>
Exhibit R - Contracts Being Assigned
Northeastern Chemical Corporation - Water Treatment
Mutliplex Electrical System - Class E Fire Alarm
The Plant Lady Store - Plant Maintenance
Remco Maintenance Corporation - Metal Maintenance
USA Waste of New York - Rubbish Removal and Recycling
GNC - Security
Johnson Controls - Engineer
Pagenet - Beepers
Pitney Bowes - Fax
Pritchard - Cleaning
Schindler Elevators - Elevator, as amended
Xerox - Photocopier
