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 29, 1998
JMB INCOME PROPERTIES, LTD. - XIII
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(Exact name of registrant as specified in its charter)
Illinois 0-19496 36-3426137
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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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JMB INCOME PROPERTIES, LTD. - XIII
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ITEM 5. OTHER EVENTS. Prior to the end of 1998, the Partnership reduced
all of its assets to cash or cash equivalents and thereby dissolved in
accordance with the terms of its partnership agreement. On December 29,
1998, JMB Realty Corporation, the Managing General Partner of the
Partnership, arranged for the establishment of a liquidating trust to be
known as the JMB Income Prop. - XIII Liquidating Trust (the "Liquidating
Trust"). On December 31, 1998 the Partnership transferred all of the
Partnership's remaining assets, subject to liabilities, into the
Liquidating Trust. The Liquidating Trust was established to, among other
things, hold approximately $1,140,000 in remaining cash (the "Funds") and
assume among other things, certain contingent liabilities and claims
pursuant to certain representations, warranties and indemnities and certain
other obligations (collectively, the "Indemnity Obligations") the
Partnership made in connection with the sale of its last remaining real
property interest, the Fountain Valley Industrial Park. The Indemnity
Obligations have a stipulated survival period which generally expires June
11, 1999. The Funds represent a reasonable estimate of the amount required
to pay (i) the maximum potential liability under the Indemnity Obligations,
(ii) certain unpaid expenses and liabilities of the Partnership, and (iii)
administrative expenses of the Liquidating Trust.
The trustees of the Liquidating Trust are individuals who currently
serve as officers of the Managing General Partner. Upon the transfer of the
Funds into the Liquidating Trust, outstanding limited partnership interests
( and assignee interests therein) in the Partnership (the "Partnership
Interests"), exclusive of the interest of the special limited partner in
the Partnership, were deemed canceled. Concomitantly, a beneficial
interest in the Liquidating Trust was created for each holder of
Partnership Interests in an amount determined by the ratio of the number of
Partnership Interests held by such holder to the aggregate number of
Partnership Interests held by all holders. The beneficiaries are deemed
owners of the Liquidating Trust, and they will be treated for federal
income tax purposes as owning undivided interests in its assets. The
General Partners and the special limited partner of the Partnership hold no
beneficial interests in the Liquidating Trust. The beneficial interests in
the Liquidating Trust are not represented by certificates and are not
assignable or transferable except by will, intestate succession or
operation of law.
<PAGE>
The Liquidating Trustees shall make a final liquidating distribution
to the beneficiaries out of any remaining assets of the Liquidating Trust
as soon as practicable following the expiration of the Indemnity
Obligations or, if a claim has arisen thereunder that has not been resolved
prior to such expiration, as soon as practicable following resolution of
such claim.
Also effective December 29, 1998, the Partnership entered into an
agreement (the "Winding Up Agreement") with the Managing General Partner in
connection with the winding up of the affairs of the Partnership by
December 31, 1998. Pursuant to the Winding Up Agreement, the Managing
General Partner generally assumed the obligation to pay or otherwise
discharge liabilities of the Partnership not otherwise paid, discharged or
provided for by the Partnership or the Liquidating Trust, including
contingent liabilities of the Partnership that may arise after termination
the Liquidating Trust. In consideration of such assumption, the
Partnership paid the Managing General Partner approximately $4,600 in cash
and transferred to the Managing General Partner the Partnership's
contingent rights, if any, to indemnification or reimbursement, including
coverage and benefits under contracts of insurance, and certain other
rights to receive or collect amounts,if any, that may be payable to the
Partnership.
Holders of Partnership Interests received a payment or distribution
in the aggregate amount of $ 158.06 per Partnership Interest in connection
with the winding up of the Partnership.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) Financial Statements. Not applicable.
(b) Proforma Financial Information. Not applicable.
(c) Exhibits.
10.1 Winding Up Agreement between JMB Income Properties, Ltd.
- - XIII and JMB Realty Corporation, dated as of December 29, 1998.
10.2 Liquidating Trust Agreement between JMB Income
Properties, Ltd. - XIII and the liquidating trustees dated as of December
29, 1998.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
JMB INCOME PROPERTIES, LTD. - XIII
By: JMB Realty Corporation
Managing General Partner
By: GAILEN J. HULL
____________________________
Gailen J. Hull
Senior Vice President
Dated: January 13, 1999
EXHIBIT 10.1
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WINDING UP AGREEMENT
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THIS AGREEMENT is made effective as of December __, 1998 by and
between JMB INCOME PROPERTIES, LTD.-XIII, an Illinois limited partnership
(the "Partnership"), and JMB REALTY CORPORATION, a Delaware corporation
("JMB"). Capitalized terms used herein but not defined have the same
meanings as in the Partnership's Amended and Restated Agreement of Limited
Partnership (as amended to date, the "Partnership Agreement").
WITNESSETH:
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WHEREAS, on or before the Winding Up Date (as hereinafter defined)
the Partnership will have reduced all of the assets of the Partnership to
cash or cash equivalents and thereby dissolved in accordance with
Section 8.1 of the Partnership Agreement; and
WHEREAS, the Partnership desires to complete the winding up of its
business and affairs effective as of December 31, 1998 (the "Winding Up
Date"); and
WHEREAS, JMB as the Managing General Partner of the Partnership has
arranged for the establishment of a liquidating trust (the "Liquidating
Trust") to, among other things, assume certain liabilities and claims
(including certain contingent liabilities and claims) against the
Partnership; and
WHEREAS, there may be certain other costs, expenses, obligations or
liabilities incurred by or on behalf of, or claims, demands, assessments or
charges against, the Partnership (collectively, the "Liabilities") that
will not be paid, discharged, extinguished or otherwise provided for by the
Partnership or the Liquidating Trust; and
WHEREAS, the Partnership desires to be relieved of the Liabilities on
the terms and conditions set forth herein in order to complete the winding
up of its business and affairs on the Winding Up Date; and
WHEREAS, JMB is willing to assume the obligation to pay, extinguish
or otherwise discharge the Liabilities on the terms and conditions set
forth herein;
NOW, THEREFORE, in consideration of the mutual covenants and
agreements herein contained, the parties hereto agree as follows:
1. JMB hereby assumes the obligation to pay, extinguish or
otherwise discharge, and agrees to indemnify, defend and hold harmless the
Partnership and each of its other partners from, each of the Liabilities,
whether known or unknown, suspected or unsuspected, fixed or contingent,
foreseen or unforeseen, that is not paid, discharged, extinguished or
otherwise provided for by the Partnership or the Liquidating Trust;
provided, however that in no event shall the Liabilities be deemed to
include any obligation or liability of the Partnership (i) that is assumed
and is or will be paid or otherwise discharged by the Liquidating Trust,
(ii) for any distribution of cash or other property or asset of any kind
that was, is or may be distributable (including, without limitation, a
return of any capital contribution) to any partner of the Partnership (or
his assignee), or any beneficiary of the Liquidating Trust, in his capacity
as such or (iii) for which the obligation or liability of, or recourse
against, the Partnership was or is, by law, contract or otherwise, limited
to an asset or assets of the Partnership.
<PAGE>
2. In consideration of JMB's assumption of the obligation to pay,
extinguish or otherwise discharge the Liabilities as provided in this
Agreement, the Partnership (i) agrees to pay JMB on or before the Winding
Up Date the amount of $4,633.73 and (ii) hereby transfers and assigns to
JMB all of the Partnership's right, title to and interest in, and all of
the Partnership's rights to own, receive, collect and/or enforce the
payment, reimbursement or transfer of, any and all monies or other property
or assets of any kind (and any claims therein or thereto), including,
without limitation, the coverage and benefits by, and proceeds receivable
from, all contracts of insurance maintained by or on behalf of the
Partnership, to the maximum extent provided therein or under applicable
law, that remain, or that become or otherwise would or may be, payable,
transferable or reimbursable to the Partnership, on or after the Winding Up
Date (other than such rights with respect to any monies of the Partnership
that are to be transferred to the Liquidating Trust or that remain on the
Winding Up Date and are required to pay or discharge checks or drafts
issued by the Partnership on or before the Winding Up Date). JMB shall
have no right of indemnification or contribution from any of the other
partners of the Partnership in their capacity as such as a result of
payments or claims made with respect to the Liabilities, whether or not
such payments or claims in the aggregate are in excess of the amount of
money or the value of other property or assets paid or transferred to or
received or collected by JMB pursuant to the terms of this Agreement.
3. Notwithstanding anything to the contrary in this Agreement, JMB
shall be entitled to the benefit of any and all rights of indemnification,
contribution, offset and any other right of recourse to or claim against
any third party (other than any right of indemnification or contribution
with respect to the Liabilities by or from a partner of the Partnership in
his capacity as such but including any other recourse to or claim against a
person who is or was a partner of the Partnership in any other capacity)
that the Partnership has, may have or otherwise could have or assert at any
time, whether in connection with, relating to or arising from any of the
Liabilities or otherwise, and the Partnership hereby assigns and transfers
to JMB all of its right, title to and interest in each and every such right
or claim.
4. The Partnership hereby makes, constitutes and appoints JMB,
with full power of substitution, the Partnership's true and lawful
attorney-in-fact for the Partnership and in its name, place and stead to
make, execute, acknowledge, swear to, deliver, record, file and/or perform
any agreements, instruments or other documents, and to take any and all
other actions on behalf of the Partnership, whether on or after the Winding
Up Date, that may be considered necessary or desirable by JMB to carry out
fully the provisions of this Agreement, including without limitation, to
execute and deliver on behalf of the Partnership any document evidencing,
acknowledging or fulfilling the assignment and transfer by the Partnership
to JMB of any rights or claims referred to in Section 2 or 3 of this
Agreement and to collect, sue for or recover any monies or other property
or assets, to compromise or settle any claims and to endorse any checks or
other instruments on behalf of the Partnership. Pursuant to such power of
attorney, the Partnership hereby authorizes JMB to take any and all actions
on behalf of the Partnership as JMB may consider necessary or desirable in
connection with any of the foregoing to the same extent as the Partnership
could or might do if personally present, and the Partnership hereby
approves and confirms all such actions on its behalf. The power of
attorney hereby granted is coupled with an interest, is irrevocable and, to
the extent allowed by applicable law, shall survive the dissolution,
winding up and termination of the Partnership.
5. Except as otherwise expressly provided in this Agreement,
nothing contained herein shall prevent, limit or qualify in any way the
rights, powers and authority JMB otherwise has or may exercise in its
capacity as the Managing General Partner of the Partnership.
<PAGE>
6. This Agreement shall inure to the benefit of, and shall be
binding upon, the parties hereto and their respective successors and
assigns. This Agreement and the rights and obligations of the parties
hereto shall survive the dissolution, winding up and termination of the
Partnership.
7. If any one or more of the provisions of this Agreement is for
any reason held to be invalid, illegal or unenforceable in any respect by a
court of competent jurisdiction, such invalidity, illegality or
unenforceability shall not impair or affect the validity and enforceability
of the other provisions hereof, and this Agreement shall be construed as
though each such invalid, illegal or unenforceable provision were not
contained herein.
8. Any reference in this Agreement to the singular shall also be
deemed to include the plural, and vice versa, unless the context otherwise
requires.
9. This Agreement and the rights and obligations of the parties
hereto shall be interpreted, construed and enforced in accordance with the
internal laws of the State of Illinois.
10. This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same Agreement.
<PAGE>
IN WITNESS WHEREOF, the undersigned have executed this Agreement
effective as of the date first written above.
JMB REALTY CORPORATION
By: __________________________________
Its: __________________________________
JMB INCOME PROPERTIES, LTD.-XIII
By: JMB Realty Corporation
Managing General Partner
By: _________________________________
Its: _________________________________
By: AGPP Associates, L.P.
Associate General Partner
By: JMB Realty Corporation
General Partner
By: _________________________________
Its: _________________________________
By: Income Partners-XIII
Associate General Partner
By: AGPP Associates, L.P.
General Partner
By: JMB Realty Corporation
General Partner
By: __________________________________
Its: __________________________________
<PAGE>
State of Illinois)
) SS:
County of Cook )
Before me, the undersigned, a Notary Public in and for said County
and State, on this day personally appeared _____________________________, a
____________________________ of JMB REALTY CORPORATION ("JMB"), a Delaware
corporation that is the Managing General Partner of JMB Income Properties,
Ltd.-XIII, (the "Partnership"), an Illinois limited partnership, and the
sole general partner of AGPP Associates, L.P., an Illinois limited
partnership that is an Associate General Partner of the Partnership and the
sole general partner of Income Partners-XIII, an Illinois limited
partnership that is an Associate General Partner of the Partnership; and
___________________________, a __________________________ of JMB, who are
known to me to be the persons whose names are subscribed to the foregoing
instrument and acknowledged to me that they executed the same in the
capacities and for the purposes and consideration therein expressed.
Given under my hand and seal of office this ______ day of December,
1998.
__________________________________
Notary Public
My commission expires:
____________________________
EXHIBIT 10.2
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LIQUIDATING TRUST AGREEMENT
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JMB INCOME PROP.-XIII
LIQUIDATING TRUST
AGREEMENT AND DECLARATION OF TRUST by and among H. Rigel Barber,
Jeffrey A. Gluskin and Gary Nickele (the "Liquidating Trustees"), and JMB
Income Properties, Ltd.-XIII, a limited partnership governed by the Revised
Uniform Limited Partnership Act (the "Act") of the State of Illinois (the
"Partnership").
WHEREAS on December 11, 1998 the last remaining real property interest
of the Partnership was sold and all of the Partnership's assets have been
reduced to cash or cash equivalents, and thus, pursuant to Section 8.1(ii)
of the Partnership's Amended and Restated Agreement of Limited Partnership
(the "Partnership Agreement") and in accordance with the Act, the
Partnership is dissolved, and JMB Realty Corporation, the Managing General
Partner of the Partnership (the "Managing General Partner"), is authorized
to wind up the affairs of the Partnership;
WHEREAS, pursuant to the terms of that certain Purchase Agreement and
Joint Escrow Instructions, dated as of November 9, 1998, by and between the
Partnership and TA Realty Corp., a Massachusetts corporation (as amended or
supplemented, the "Purchase Agreement"), the Partnership made certain
representations, warranties and indemnities and undertook certain other
obligations (collectively, the "Indemnity Obligations") in connection with
the sale of its last remaining real property interest;
WHEREAS, the Managing General Partner has determined that the
Partnership presently holds, more or less, $1,140,254.28 in cash (the
"Funds") and that there are or may be outstanding liabilities (whether
fixed or contingent) of the Partnership, and/or creditors of the
Partnership with contingent or unliquidated claims against the Partnership
or claims that are not feasible to settle at this time, and thus, the
Managing General Partner believes that a transfer of the Funds into a
liquidating trust, that has as original Liquidating Trustees certain
individuals who currently serve as officers of the Managing General
Partner, is now appropriate;
WHEREAS, the Funds represent a reasonable estimate of the amount
required to pay (i) the maximum potential liability under the Indemnity
Obligations, (ii) certain unpaid expenses and liabilities of the
Partnership, and (iii) administrative expenses of the Liquidating Trust
created hereby.
NOW THEREFORE, in consideration of the premises and other valuable
consideration, the receipt and sufficiency of which are hereby acknowledged
and confessed, subject to the terms and provisions set out below, the
Partnership hereby grants, releases, assigns, transfers, conveys and
delivers unto the Liquidating Trustees all of its right, title and interest
in the Funds in trust for the uses and purposes stated herein. The
Liquidating Trustees hereby accept such assets and such Liquidating Trust,
subject to the same terms and provisions, to wit:
<PAGE>
ARTICLE I.
NAME AND DEFINITIONS
1.1 NAME. This trust shall be known as the JMB Income Prop. - XIII
Liquidating Trust (the ''Liquidating Trust").
1.2 CERTAIN TERMS DEFINED. For all purposes of this instrument,
unless the context otherwise requires:
(a) "Agreement" or "Agreement of Trust" shall mean this
instrument as originally executed or as it may from time to time be amended
pursuant to the terms hereof.
(b) "Beneficiaries" shall mean Partnership Interest Holders
(as defined herein), and their legal representatives, who in accordance
with the terms hereof, shall have surrendered their Partnership Interests
for cancellation and have received in exchange appropriate Beneficial
Interests (as defined herein) in the Liquidating Trust Estate (as defined
herein). The Beneficiaries will be treated as grantors and deemed owners
of the Liquidating Trust and they will be treated for federal income tax
purposes as owning undivided interests in its assets.
(c) "Beneficial Interest" shall mean the share of each
Beneficiary in the Liquidating Trust Estate. On the Transfer Date (as
defined herein) each Partnership Interest Holder shall receive a Beneficial
Interest in the Liquidating Trust Estate determined by the ratio of the
number of Partnership Interests (as defined herein) held by such
Partnership Interest Holder on the Transfer Date to the aggregate number of
issued and outstanding Partnership Interests held by all Partnership
Interest Holders on the Transfer Date.
(d) "Liquidating Trust Estate" shall mean all the property held
from time to time by the Liquidating Trustees under this Agreement of Trust
including but not limited to (i) proceeds from such property held, or from
the sale thereof, (ii) dividends and other cash distributions received
from any corporation, (iii) interest earned on any monies or securities
held by the Liquidating Trustees under this Agreement of Trust, and (iv)
any royalties or income of any kind; provided however that the Liquidating
Trust shall not (A) acquire any listed stocks or securities, any readily-
marketable assets or any operating assets of a going business, (B) retain
cash in excess of a reasonable amount to meet fixed, contingent or
unliquidated claims and contingent liabilities, (C) acquire any unlisted
stock of a single issuer that represents eighty percent or more of the
stock of such issuer, or (D) acquire any general or limited partnership
interests.
(e) "Liquidating Trustees" shall mean the original Liquidating
Trustees (i.e., certain individuals who currently serve as officers of the
Managing General Partner) and their successors.
(f) "Partnership" shall mean JMB Income Properties, Ltd. -
XIII, a limited partnership currently governed by the Revised Uniform
Limited Partnership Act of the State of Illinois, which is intended to be
liquidated and terminated after the execution of this instrument.
(g) "Partnership Interests" shall mean the limited partnership
interests (and assignee interests therein) of the Partnership outstanding
on the date hereof, including those interests issued in the public
offering made pursuant to a Registration Statement on Form S-11 under the
Securities Act of 1933 (Registration No. 33-4107) which closed on April
14, 1987, but excluding the interest of the special limited partner in the
Partnership.
<PAGE>
(h) "Partnership Interest Holder" shall mean any holder of a
Partnership Interest listed in the Partnership Ownership List that is held
by the Partnership's transfer agent, Gemisys Corporation, or (in place of
any transferors) any person who acquires a Partnership Interest in the
fourth quarter of the 1998 fiscal year.
(i) "Transfer Date" shall mean the date on which all the Funds
are transferred into the Liquidating Trust.
1.3 MEANING OF OTHER TERMS. Except where the context otherwise
requires, words importing the masculine gender include the feminine and the
neuter, if appropriate, words importing the singular number shall include
the plural number and vice versa, and words importing persons shall include
firms, associations, and corporations. All references herein to Articles,
Sections, and other subdivisions refer to the corresponding Articles,
Sections, and other subdivisions of this Agreement; and the words herein,
hereof, hereby, hereunder, and words of similar import, refer to this
Agreement as a whole and not to any particular Article, Section, or
subdivision of the Agreement.
ARTICLE II.
NATURE OF TRANSFER
2.1 PURPOSE OF LIQUIDATING TRUST. The sole purpose of this
Liquidating Trust is to liquidate the Liquidating Trust Estate in a manner
calculated to conserve and protect the Liquidating Trust Estate until such
time as the proceeds can be distributed, and to collect and distribute the
income and proceeds therefrom to the Beneficiaries in as prompt and orderly
a fashion as possible after the payment of expenses and liabilities and the
making of reasonable provision for claims and contingent liabilities,
including without limitation any Indemnity Obligations. The Liquidating
Trust shall have no objective to continue or engage in the conduct of a
trade or business.
2.2 NO REVERSION TO THE PARTNERSHIP. In no event shall any part of
the Liquidating Trust Estate revert to or be distributed to the
Partnership.
2.3 INSTRUMENTS OF FURTHER ASSURANCE. The Partnership and such
persons as shall have the right and power after the termination of the
Partnership (including the Managing General Partner) will, upon reasonable
request of the Liquidating Trustees, execute, acknowledge, and deliver such
further instruments and do such further acts as may be necessary or proper
to carry out effectively the purposes of this Agreement, to transfer and
vest in the Liquidating Trustees the Funds in trust hereunder.
2.4 PAYMENT OF THE PARTNERSHIP'S LIABILITIES. The Liquidating
Trustees (in their capacity as trustees and not personally) hereby assume
all the liabilities and claims (including unascertained or contingent
liabilities and expenses) of the Partnership, subject to Section 7.2 (c).
Should any liability be asserted against the Liquidating Trustees as the
transferees of the Liquidating Trust Estate or as a result of the
assumption made in this Section, the Liquidating Trustees may use such part
of the Liquidating Trust Estate as they deem necessary or appropriate in
contesting any such liability or in payment thereof.
2.5 ASSIGNMENT FOR BENEFIT OF BENEFICIARIES. The Liquidating
Trustees hereby declare and agree that they are holding the Liquidating
Trust Estate solely for the benefit of the Beneficiaries of the Liquidating
Trust, and hereby assign to each Partnership Interest Holder a pro rata
Beneficial Interest in the Liquidating Trust Estate, and retain only such
incidents of ownership as are necessary to undertake the actions and
transactions authorized herein.
<PAGE>
ARTICLE III.
BENEFICIARIES
3.1 BENEFICIAL INTERESTS.
(a) The Beneficial Interest of each Partnership Interest Holder
shall be determined by the Liquidating Trustees in accordance with Section
1.2(c) above. Such determination shall be based upon a certified copy of
the list of Partnership Interest Holders as of the Transfer Date and shall
take into account any transfers of Partnership Interests being made during
the fourth quarter of the 1998 fiscal year (the "Partnership Ownership
List"). To be able to determine the appropriate Beneficial Interest of each
Partnership Interest Holder, on (or promptly after) the Transfer Date, the
Managing General Partner will cause the transfer agent of the Partnership,
Gemisys Corporation, to deliver a certified copy of the Partnership
Ownership List to the Liquidating Trustees.
(b) After execution of this Agreement, and upon the transfer
of the Funds into the Liquidating Trust, outstanding Partnership Interests
shall be deemed canceled. Concomitantly, a Beneficial Interest in the
Liquidating Trust shall be created for each Partnership Interest Holder in
an amount determined by the ratio of the number of Partnership Interests
held by such Partnership Interest Holder to the aggregate number of issued
and outstanding Partnership Interests held by all Partnership Interest
Holders. Beneficial Interests in the Liquidating Trust shall not be
represented by certificates, and no Beneficiary shall be entitled to such a
certificate.
3.2 RIGHTS OF BENEFICIARIES. Each Beneficiary shall be entitled to
participation in the rights and benefits due to a Beneficiary hereunder
according to his Beneficial Interest. Each Beneficiary shall take and hold
the same subject to all the terms and provisions of this Agreement of
Trust. The Beneficial Interest of each Beneficiary is hereby declared and
shall be in all respects personal property and upon the death of an
individual Beneficiary his Beneficial Interest shall pass to his legal
representative and such death shall not terminate or affect the validity of
this Agreement. A Beneficiary shall have no title to, possession of,
management of, or control of, the Liquidating Trust Estate except as herein
expressly provided. No widower, widow, heir, or devisee or any person who
may be a Beneficiary shall have any right of dower, homestead, or
inheritance, or of partition, or of any other right, statutory or
otherwise, in any property whatever forming a part of the Liquidating Trust
Estate, but the whole title to all the Liquidating Trust Estate shall be
vested in the Liquidating Trustees and the sole interest of the
Beneficiaries shall be the rights and benefits given to such persons under
this Agreement of Trust. The Beneficiaries will be treated as the grantors
and deemed owners of the Liquidating Trust, and they will be treated for
federal income tax purposes as owning undivided interests in its assets.
3.3 NO TRANSFER OF INTERESTS OF BENEFICIARIES. The Beneficial
Interest of a Beneficiary may not be transferred either by the Beneficiary
in person or by a duly authorized agent or attorney, or by the properly
appointed legal representatives of the Beneficiary, nor may a Beneficiary
have authority or power to sell, assign, transfer, encumber, or in any
other manner anticipate or dispose of his Beneficial Interest in the
Liquidating Trust; provided, however, that the Beneficial Interest of a
Beneficiary shall be assignable or transferable by will, intestate
succession, or operation of law.
3.4 APPLICABLE LAW. As to matters affecting the title, ownership,
transferability, or attachment of the Beneficial Interest of a Beneficiary
in the Liquidating Trust, the laws from time to time in force in the State
of Illinois shall govern except as otherwise herein specifically provided.
<PAGE>
ARTICLE IV.
DURATION AND TERMINATION OF LIQUIDATING TRUST
4.1 DURATION. The existence of the Liquidating Trust shall
terminate on the date which is three years from the date of creation of the
Liquidating Trust unless an earlier termination is required by the
applicable laws of the State of Illinois or by the action of the
Beneficiaries as provided in Section 4.2, or unless earlier terminated by
the distribution of all of the Liquidating Trust Estate as provided in
Section 5.6. However, notwithstanding the foregoing, if there remains any
contingent or unliquidated claims or any other outstanding contingent
liabilities for which the Liquidating Trust may be responsible, the
Liquidating Trust term may be extended, solely with respect to such claims
and liabilities, for a period that is reasonably necessary to resolve such
claims and liabilities; provided further, that if the life of the
Liquidating Trust extends beyond three years from the Transfer Date, prior
to such extension the Liquidating Trustees shall request additional
no-action assurances from the Securities and Exchange Commission regarding
the registration and reporting requirements of the Liquidating Trust under
the Securities Act of 1933, as amended, the Securities Exchange Act of
1934, as amended, and any other applicable federal securities act.
4.2 TERMINATION BY BENEFICIARIES. Subject to Section 4.1, the
Liquidating Trust may be terminated at any time by the action of
Beneficiaries having more than 50% of the aggregate Beneficial Interests as
evidenced in the manner provided in Article XII.
4.3 CONTINUANCE OF LIQUIDATING TRUSTEES' AUTHORITY AFTER
TERMINATION. After the termination of the Liquidating Trust and for the
purpose of winding up the affairs of the Liquidating Trust, the Liquidating
Trustees shall continue to have the authority to act as such until their
duties have been fully performed. Except as otherwise specifically
provided herein, upon the termination of the Liquidating Trust, the
Liquidating Trustees shall have no further duties or obligations hereunder.
ARTICLE V.
ADMINISTRATION OF LIQUIDATING TRUST ESTATE
5.1 SALE OF LIQUIDATING TRUST ESTATE. The Liquidating Trustees
may, at such times and for such amounts as they may deem appropriate,
transfer, assign, or otherwise dispose of all or any part of the
Liquidating Trust Estate as they deem appropriate at public auction or at
private sale for cash or securities, or upon credit (either secured or
unsecured as the Liquidating Trustees shall determine).
5.2 CONTINUING EFFORTS TO RESOLVE CLAIMS AND LIABILITIES. The
Liquidating Trustees will make continuing efforts to resolve any contingent
or unliquidated claims and outstanding contingent liabilities for which the
Liquidating Trust may be responsible, dispose of the Liquidating Trust
Estate, make timely distributions, and not unduly prolong the duration of
the Liquidating Trust.
5.3 CONTINUED COLLECTION OF PROPERTY OF LIQUIDATING TRUST ESTATE.
All property that is determined to be a part of the Liquidating Trust
Estate shall continue to be collected by the Liquidating Trustees and held
as a part of the Liquidating Trust Estate. The Liquidating Trustees shall
hold the Liquidating Trust Estate without being obligated to provide for or
pay any interest thereon to any Beneficiary, except to the extent of such
Beneficiary's share of interest actually earned by the Liquidating Trust
after payment of the Liquidating Trust's liabilities and expenses as
provided in Section 5.4.
<PAGE>
5.4 PAYMENT OF CLAIMS, EXPENSES AND LIABILITIES. The Liquidating
Trustees shall pay from the Liquidating Trust Estate all claims, expenses,
charges, liabilities, and obligations of the Liquidating Trust Estate and
all liabilities and obligations which the Liquidating Trustees specifically
assume and agree to pay pursuant to this Agreement of Trust and such
transferee liabilities which the Liquidating Trustees may be obligated to
pay as transferees of the Liquidating Trust Estate, including among the
foregoing, and without limiting the generality of the foregoing, accounts
payable of the Partnership and interest, taxes, assessments, and public
charges of every kind and nature and the costs, charges, and expenses
connected with or growing out of the execution or administration of the
Liquidating Trust and such other payments and disbursements as are provided
in this Agreement or which may be determined to be a proper charge against
the Liquidating Trust Estate by the Liquidating Trustees. The Liquidating
Trustees may, in their discretion, make reasonable provision by reserve or
otherwise out of the Liquidating Trust Estate, for such amount as the
Liquidating Trustees in good faith may reasonably determine to be necessary
or desirable to meet present or future claims and liabilities of the
Liquidating Trust, whether fixed or contingent.
5.5 INTERIM DISTRIBUTIONS. At such time as may be determined by
them, but not less than annually, the Liquidating Trustees shall
distribute, or cause to be distributed, to the Beneficiaries of record on
the close of business on such record date as the Liquidating Trustees may
determine, in proportion to the respective Beneficial Interests of the
Beneficiaries in the Liquidating Trust Estate, (i) an amount which
represents the income from investments, and (ii) cash or non-cash property
comprising the Liquidating Trust Estate; provided, however, that the amount
described in (i) and (ii) shall be reduced by the retention of reasonable
amounts of cash and property determined in the sole discretion of the
Liquidating Trustees to be sufficient to meet claims and contingent
liabilities.
5.6 FINAL DISTRIBUTION. If the Liquidating Trustees determine that
all claims, debts, liabilities, and obligations of the Liquidating Trust
have been paid or discharged (except those of Beneficiaries with respect to
their interests herein), or if the existence of the Liquidating Trust shall
terminate pursuant to Sections 4.1 or 4.2, the Liquidating Trustees shall,
as expeditiously as is consistent with the conservation and protection of
the Liquidating Trust Estate, distribute the Liquidating Trust Estate to
each Beneficiary of record on the close of business on such record date as
the Liquidating Trustees may determine, in proportion to each Beneficiary's
Beneficial Interest therein. In furtherance, and not in limitation, of the
foregoing, the Liquidating Trustees shall make a final liquidating
distribution to the Beneficiaries out of the remaining Liquidating Trust
Estate as soon as practicable following the expiration of the Indemnity
Obligations under the Purchase Agreement or, if a claim has arisen
thereunder, as soon as practicable following resolution of such claim.
5.7 FISCAL YEAR. The fiscal year of the Liquidating Trust shall
end on December 31 of each year unless the Liquidating Trustees deem it
advisable to establish some other date as the date on which the fiscal year
of the Liquidating Trust shall end.
5.8 ANNUAL REPORTS TO BENEFICIARIES; FEDERAL INCOME TAX
INFORMATION. As soon as practicable after the close of each fiscal year
(other than 1998 but including the year in which the Liquidating Trust
terminates as provided in Article IV or this Article V), but in any event
within 90 days thereafter, the Liquidating Trustees shall prepare and mail
to each Beneficiary a report for such fiscal year showing the assets and
liabilities of the Liquidating Trust at the end of each such fiscal year
and the receipts and disbursements of the Liquidating Trust for the period,
<PAGE>
including dates and amounts of distributions made by the Liquidating
Trustees and information regarding interest income received by the
Liquidating Trustees on any obligations owing to the Liquidating Trust or
the Liquidating Trustees, and such other information for such fiscal year
as is reasonably available to the Liquidating Trustees which may be
necessary or useful in determining the amount of taxable income from the
Liquidating Trust that such Beneficiary may be required to include in his
federal income tax return for such year. Such report shall also describe
the changes in the Liquidating Trust's assets during the period and the
actions taken by the Liquidating Trustees during the period. The
financial statements contained in such report shall be prepared in
accordance with generally accepted accounting principles, but need not be
audited by an independent public accountant. In addition, after receipt of
a request in good faith, or in their discretion without such request, the
Liquidating Trustees may furnish to any person who has been a Beneficiary
at any time during the preceding fiscal year a statement containing such
further information as is reasonably available to the Liquidating Trustees
which may be helpful to such person for federal, state or local income tax
purposes. The Liquidating Trustees shall file returns as a grantor trust
pursuant to U.S. Treasury Regulation Section 1.671-4(a).
5.9 INTERIM REPORTS TO BENEFICIARIES. During the course of a
fiscal year, whenever a material event relating to the Liquidating Trust's
assets occurs, the Liquidating Trustees shall, within a reasonable period
of time after such occurrence, prepare and mail to the Beneficiaries an
interim report describing such event. The occurrence of a material event
need not be reported on an interim report if an annual report pursuant to
Section 5.8 will be issued at approximately the same time that such interim
report would be issued and such annual report describes the material event
as it would be discussed in an interim report. The occurrence of a
material event will be determined solely by the Liquidating Trustees.
ARTICLE VI.
POWERS AND LIMITATIONS OF THE LIQUIDATING TRUSTEES
6.1 LIMITATIONS ON LIQUIDATING TRUSTEES. The Liquidating Trustees
shall not at any time, on behalf of the Liquidating Trust or Beneficiaries,
enter into or engage in any business, except to the extent that both (1)
the business was engaged in by the Partnership immediately prior to its
liquidation and (2) the continuing conduct of the business activities is
necessary to conserve or maintain the Liquidating Trust Estate and to
facilitate expeditious liquidation of the Liquidating Trust Estate. The
Liquidating Trustees shall have no power to invest or reinvest any of the
funds held in the Liquidating Trust Estate, except that the Liquidating
Trustees may, on a temporary basis or for purposes of retaining a
reasonable amount of property to meet expenses, obligations, claims and
contingent liabilities, invest any portion of the Liquidating Trust Estate
in demand and time deposits at savings institutions, or short-term
certificates of deposit or Treasury bills, or securities with short-term
original or remaining maturities issued by state or local governments (or
agencies or instrumentalities thereof). The Liquidating Trustees shall be
restricted to the holding and collection of the Liquidating Trust Estate
and the payment and distribution thereof for the purpose set forth in this
Agreement and to the conservation and protection of the Liquidating Trust
Estate and the administration thereof in accordance with the provisions of
this Agreement. In no event shall the Liquidating Trustees receive any
property, make any distribution, satisfy or discharge any obligation,
claim, liability or expense or otherwise take any action which is
inconsistent with a complete liquidation of the Liquidating Trust.
<PAGE>
6.2 SPECIFIC POWERS OF LIQUIDATING TRUSTEES. Subject to the
provisions herein, the Liquidating Trustees shall have the following
specific powers in addition to any powers conferred upon them by any other
Section or provision of this Agreement of Trust; provided, however, that
enumeration of the following powers shall not be considered in any way to
limit or control the power of the Liquidating Trustees to act as
specifically authorized by any other Section or provision of this Agreement
or to act in such a manner as the Liquidating Trustees may deem necessary
or appropriate to carry out the purpose of the Liquidating Trust or to
confer on the Beneficiaries the benefits intended to be conferred upon them
by this Agreement.
(a) To determine the terms on which assets comprising the
Liquidating Trust Estate should be sold or otherwise disposed of and to
cause the sale of such assets;
(b) To collect and receive any and all money and other
property of whatsoever kind or nature due to or owing or belonging to the
Liquidating Trust and to give full discharge and acquittance therefor;
(c) Pending sale or other disposition or distribution, to
retain all or any assets constituting part of the Liquidating Trust Estate.
The Liquidating Trustees shall not be under any duty to reinvest such part
of the Liquidating Trust Estate as may be in cash, or as may be converted
into cash, nor shall the Liquidating Trustees be chargeable with interest
thereon except to the extent that interest may be paid to the Liquidating
Trustees on such cash amounts;
(d) To retain and set aside such funds of the Liquidating
Trust Estate as the Liquidating Trustees shall deem necessary or expedient
to pay or provide for the payment of (i) unpaid claims, liabilities, debts
or other obligations of the Partnership or the Liquidating Trust, (ii)
contingencies, and (iii) the expenses of administering the Liquidating
Trust Estate;
(e) To do and perform any acts or things necessary or
appropriate to carry out the purpose of the Liquidating Trust, including
acts or things necessary or appropriate to maintain assets held by the
Liquidating Trustees pending sale or other disposition thereof or
distribution thereof to the Beneficiaries;
(f) To employ such agents and advisors (which may include the
Liquidating Trustees, one or more of the Beneficiaries, or corporations or
partnerships owned or controlled by the Liquidating Trustees or
Beneficiaries (including JMB Realty Corporation) and to confer upon them
such authority as the Liquidating Trustees may deem necessary, appropriate
or expedient, and to pay reasonable compensation therefor from the
Liquidating Trust Estate; provided that any such agreements or arrangements
with a person or entity affiliated with any of the Liquidating Trustees
shall be on terms no less favorable to the Liquidating Trust than those
available to the Liquidating Trust in similar agreements or arrangements
with unaffiliated third parties, and such agreements or arrangements shall
be terminable, without penalty, on 60 days' prior written notice by the
Liquidating Trust;
(g) To cause any investments of the Liquidating Trust Estate
to be registered and held in the names of the Liquidating Trustees or in
the names of a nominee or nominees without increase or decrease of
liability with respect thereto;
<PAGE>
(h) To institute or defend actions or declaratory judgments or
other actions and to take such other action, in the name of the Liquidating
Trust or of the Partnership if otherwise required, as the Liquidating
Trustees may deem necessary or desirable to enforce any instruments,
contracts, agreements, or causes of action relating to or forming a part of
the Liquidating Trust Estate;
(i) To cancel, terminate, or amend any instruments, contracts,
or agreements relating to or forming a part of the Liquidating Trust
Estate, and to execute new instruments, contracts or agreements,
notwithstanding that the terms of any such instruments, contracts, or
agreements may extend beyond the terms of the Liquidating Trust, provided
that no such new instrument, contract or agreement shall permit the
Liquidating Trustees to engage in any activity prohibited hereunder;
(j) In the event any of the property which is or may become a
part of the Liquidating Trust Estate is situated in any state or other
jurisdiction in which the Liquidating Trustees are not qualified to act as
Liquidating Trustees, to nominate and appoint an individual or corporate
trustee qualified to act in such state or other jurisdiction in connection
with the property situated in that state or other jurisdiction as a trustee
of such property and require from such trustee such security as may be
designated by the Liquidating Trustees. The trustee so appointed shall
have all the rights, powers, privileges and duties and shall be subject to
the conditions and limitations of this Liquidating Trust, except as limited
by the Liquidating Trustees and except where the same may be modified by
the laws of such state or other jurisdiction (in which case, the laws of
the state or other jurisdiction in which such trustee is acting shall
prevail to the extent necessary). Such trustee shall be answerable to the
Liquidating Trustees herein appointed for all monies, assets and other
property which may be received by it in connection with the administration
of such property. The Liquidating Trustees hereunder may remove such
trustee, with or without cause, and appoint a successor trustee at any time
by the execution by the Liquidating Trustees of a written instrument
declaring such trustee removed from office, and specifying the effective
date of removal;
(k) To perform any act authorized, permitted, or required
under any instrument, contract, agreement, or cause of action relating to
or forming a part of the Liquidating Trust Estate, whether in the nature of
an approval, consent, demand, or notice thereunder or otherwise, unless
such act would require the consent of the Beneficiaries in accordance with
the express provisions of this Agreement; and
(l) to settle any and all claims, suits or other actions that
are or may be brought by or against the Partnership, Liquidating Trust,
Liquidating Trustees or Liquidating Trust Estate.
6.3 POWERS OF LIQUIDATING TRUSTEES TO DEAL WITH LIQUIDATING TRUST
IN NON-FIDUCIARY CAPACITY. The Liquidating Trustees may, except as limited
herein, deal with the Liquidating Trust Estate, including, without
limitation, loan property to, borrow property from, purchase property from
or otherwise deal with the Liquidating Trust Estate as if they were not
Liquidating Trustees thereof.
<PAGE>
ARTICLE VII.
LIQUIDATING TRUSTEES
7.1 GENERALLY. The Liquidating Trustees accept and undertake to
discharge the Liquidating Trust created by this Agreement, upon the terms
and conditions thereof. No Liquidating Trustee shall be subject to any
personal liability whatsoever to any person in connection with the
Liquidating Trust Estate or the affairs of this Liquidating Trust, except
for his own misconduct knowingly and intentionally committed in bad faith.
No provision of this Agreement shall be construed to relieve the
Liquidating Trustees from liability for their own misconduct knowingly and
intentionally committed in bad faith, except that:
(a) The Liquidating Trustees shall not be required to perform
any duties or obligations except for the performance of such duties and
obligations as are specifically set forth in this Agreement, and no implied
covenants or obligations shall be read into this Agreement against the
Liquidating Trustees.
(b) In the absence of bad faith on the part of the Liquidating
Trustees, the Liquidating Trustees may conclusively rely, as to the truth,
accuracy and completeness thereof, on the statements and certificates or
opinions furnished to the Liquidating Trustees and conforming to the
requirements of this Agreement.
(c) The Liquidating Trustees shall not be liable for any error
of judgment made in good faith.
(d) The Liquidating Trustees shall not be liable with respect
to any action taken or omitted to be taken by them in accordance with the
direction of Beneficiaries having aggregate Beneficial Interests of more
than 50% of all Beneficial Interests relating to the time, method, and
place of conducting any proceeding for any remedy available to the
Liquidating Trustees, or exercising any trust or power conferred upon the
Liquidating Trustees under this Agreement.
7.2 RELIANCE BY LIQUIDATING TRUSTEES. Except as otherwise provided
in Section 7.1:
(a) The Liquidating Trustees may rely and shall be protected
in acting upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, consent, order, or other paper or document
believed by them to be genuine and to have been signed or presented by the
proper party or parties.
(b) The Liquidating Trustees may consult with legal counsel to
be selected by them, and the Liquidating Trustees shall not be liable for
any action taken or suffered by them in accordance with the advice of such
counsel.
(c) Persons dealing with the Liquidating Trustees shall look
only to the Liquidating Trust Estate to satisfy any liability incurred by
the Liquidating Trustees in good faith to any such person in carrying out
the terms of this Liquidating Trust, and the Liquidating Trustees shall
have no personal or individual obligation to satisfy any such liability.
7.3 INDEMNIFICATION OF LIQUIDATING TRUSTEES. The Liquidating
Trustees shall be indemnified by and receive reimbursement from the
Liquidating Trust Estate against and from any and all loss, liability or
damage which such Liquidating Trustees may incur or sustain, in good faith,
in the exercise and performance of any of the powers and duties of such
Liquidating Trustees under this Agreement; however, no party other than the
Liquidating Trustees shall have the right to cause the Liquidating Trust to
indemnify the Liquidating Trustees. The Liquidating Trustees may purchase
<PAGE>
with assets of the Liquidating Trust Estate, such insurance as they feel,
in the exercise of their discretion, adequately insures that they shall be
indemnified against any such loss, liability or damage pursuant to this
Section.
7.4 NO DUTY NOT TO COMPETE. The Liquidating Trustees, in their
individual capacity or through corporations, partnerships or other entities
which they control or in which they have an interest, may engage in or
possess any interest in any business venture, including, but not limited
to, the ownership, financing, management of real property, or the
investment of securities, or the provision of any services in connection
with such activities. No Liquidating Trustee has any duty to present any
business opportunity to the Liquidating Trust before taking advantage of
such opportunity either in his individual capacity or through participation
in any entity.
ARTICLE VIII.
PROTECTION OF PERSONS DEALING WITH THE LIQUIDATING TRUSTEES
8.1 ACTION BY LIQUIDATING TRUSTEES. Except as otherwise provided
by resolution adopted or approved by a majority of the Liquidating
Trustees, all action with respect to the disposition and distribution of
the Liquidating Trust Estate required or permitted to be taken by the
Liquidating Trustees, in their capacity as Liquidating Trustees, may be
taken by approval, consent, vote or resolution authorized by any of the
Liquidating Trustees then serving.
8.2 RELIANCE ON STATEMENT BY LIQUIDATING TRUSTEES. Any person
dealing with the Liquidating Trustees shall be fully protected in relying
upon the Liquidating Trustees' certificate signed by any Liquidating
Trustee that they have authority to take any action under this Liquidating
Trust. Any person dealing with the Liquidating Trustees shall be fully
protected in relying upon the Liquidating Trustees' certificate setting
forth the facts concerning the calling of any meeting of the Beneficiaries,
the giving of notice thereof, and the action taken at such meeting,
including the aggregate Beneficial Interests of Beneficiaries taking such
action.
8.3 APPLICATION OF MONEY PAID OR TRANSFERRED TO LIQUIDATING
TRUSTEES. No person dealing with the Liquidating Trustees shall be
required to follow the application by the Liquidating Trustees of any money
or property which may be paid or transferred to the Liquidating Trustees.
ARTICLE IX.
COMPENSATION OF LIQUIDATING TRUSTEES
9.1 AMOUNT OF COMPENSATION. In lieu of commissions or other
compensation fixed by law for trustees, each Liquidating Trustee shall
receive as compensation for their services as Liquidating Trustees
hereunder and as additional compensation from the cash proceeds of the sale
of any part of the Liquidating Trust Estate while he is serving as
Liquidating Trustee, such compensation as may subsequently be approved by
Beneficiaries having aggregate Beneficial Interests of more than 50% of all
Beneficial Interests.
9.2 DATES OF PAYMENT. The compensation payable to the Liquidating
Trustees pursuant to the provisions of Section 9.1 shall be paid annually
or at such other times as the Beneficiaries having aggregate Beneficial
Interests of more than 50% of all Beneficial Interests shall approve.
9.3 EXPENSES. The Liquidating Trustees shall be reimbursed from
the Liquidating Trust Estate for all out-of-pocket expenses reasonably
incurred by them or any of their affiliates in the performance of their
duties in accordance with this Agreement, including the payment of
reasonable fees and/or expenses to agents, advisors or legal counsel.
<PAGE>
ARTICLE X.
LIQUIDATING TRUSTEES AND SUCCESSOR LIQUIDATING TRUSTEES
10.1 NUMBER OF LIQUIDATING TRUSTEES. Subject to the provisions of
Section 10.3 relating to the period pending the appointment of a successor
trustee, there shall be three Liquidating Trustees of the Liquidating
Trust.
10.2 RESIGNATION AND REMOVAL. Any Liquidating Trustee may resign
and be discharged from the Liquidating Trust hereby created by delivering
such notice to the remaining Liquidating Trustee(s). Such resignation
shall become effective on the day specified in such notice or upon the
appointment of such Liquidating Trustee's successor and such successor's
acceptance of such appointment, whichever is earlier. Any Liquidating
Trustee may be removed at any time, with or without cause, by Beneficiaries
having aggregate Beneficial Interests of more than 50% of all Beneficial
Interests.
10.3 APPOINTMENT OF SUCCESSOR. Any time one or more Liquidating
Trustees shall resign or be removed, or die or become incapable of action,
or be adjudged a bankrupt or insolvent, a vacancy shall be deemed to exist
and a successor shall be appointed by the remaining Liquidating Trustee(s).
If such vacancy is not filled by the remaining Liquidating Trustee(s)
within 30 days, the Beneficiaries may, pursuant to Article XII hereof, call
a meeting to appoint a successor trustee by majority in interest. Pending
the appointment of a successor trustee, the remaining Liquidating
Trustee(s) then serving may take any action in the manner set forth in
Section 8.1. Beneficiaries holding in the aggregate more than 50% of all
Beneficial Interests can appoint one or more additional Liquidating
Trustees even if no vacancy exists.
10.4 ACCEPTANCE OF APPOINTMENT BY SUCCESSOR LIQUIDATING TRUSTEE.
Any successor trustee appointed hereunder shall execute an instrument
accepting such appointment hereunder and shall deliver one counterpart
thereof to the other remaining Liquidating Trustees (notice of any such
appointment of a successor trustee shall be provided to the Beneficiaries
in the next report delivered to the Beneficiaries pursuant to Article V
hereof) and, in the case of a resignation, to the retiring Liquidating
Trustee. Thereupon such successor trustee shall, without any further act,
become vested with all the estate, properties, rights, powers, trusts, and
duties of his predecessor in the Liquidating Trust hereunder with like
effect as if originally named therein, but the retiring Liquidating Trustee
shall nevertheless, when requested in writing by the successor trustee,
execute and deliver an instrument or instruments conveying and transferring
to such successor trustee upon the trust herein expressed, all of the
estates, properties, rights, powers and trusts of such retiring Liquidating
Trustee, and shall duly assign, transfer, and deliver to such successor
trustee all property and money held by him hereunder.
10.5 BONDS. No bond shall be required of any original Liquidating
Trustee hereunder. Unless required by the remaining Liquidating Trustees
or a vote of the Beneficiaries holding in the aggregate more than 50% of
all Beneficial Interests prior to a successor trustee's acceptance of an
appointment as such pursuant to Section 10.4, or unless a bond is required
by law, no bond shall be required of any successor trustee hereunder. If a
bond is required by law, no surety or security with respect to such bond
shall be required unless required by law or unless required by the
Beneficiaries (in the case of a successor trustee). If a bond is required
by a vote of the Beneficiaries holding in the aggregate more than 50% of
all Beneficial Interests, the Beneficiaries shall determine whether, and to
what extent, a surety or security with respect to such bond shall be
required.
<PAGE>
ARTICLE XI.
CONCERNING THE BENEFICIARIES
11.1 EVIDENCE OF ACTION BY BENEFICIARIES. Whenever in this
Agreement it is provided that the Beneficiaries may take any action
(including any vote, the making of any demand or request, the giving of
any notice, consent, or waiver, the removal of a Liquidating Trustee, the
appointment of a successor trustee, or the taking of any other action), the
fact that at the time of taking any such action, such holders have joined
therein may be evidenced (i) by any instrument or any number of instruments
of similar tenor executed by the Beneficiaries in person or by agent or
attorney appointed in writing, or (ii) by the record of the Beneficiaries
duly called and held in accordance with the provisions of Article XII.
11.2 LIMITATIONS ON SUITS BY BENEFICIARIES. No Beneficiary shall
have any right by virtue of any provision in this Agreement to institute
any action or proceeding at law or in equity against any party other than
the Liquidating Trustees, upon or under or with respect to the Liquidating
Trust Estate or any agreements relating to or forming parts of the
Liquidating Trust Estate, and the Beneficiaries do hereby waive any such
right.
11.3 REQUIREMENT OF UNDERTAKING. The Liquidating Trustees may
request any court to require, and any court may in its discretion require,
in any suit for the enforcement of any right or remedy under this
Agreement, or in any suit against the Liquidating Trustees for any action
taken or omitted by them as Liquidating Trustees, the filing by any party
litigant in such suit of an undertaking to pay the costs of such suit, and
such court may in its discretion assess reasonable costs, including
reasonable attorneys' fees, against any party litigant in such suit, having
due regard to the merits and good faith of the claims or defenses made by
such party litigant; provided, that the provisions of this Section shall
not apply to any suit by the Liquidating Trustees, and such undertaking
shall not be required from the Liquidating Trustees or otherwise required
in any suit by any Beneficiary or group of Beneficiaries having aggregate
Beneficial Interests of more than 50% of all Beneficial Interests.
ARTICLE XII.
MEETING OF BENEFICIARIES
12.1 PURPOSE OF MEETINGS. A meeting of the Beneficiaries may be
called at any time and from time to time pursuant to the provisions of this
Article for the purposes of taking any action which the terms of this
Agreement permit Beneficiaries having specified aggregate Beneficial
Interests to take either acting alone or with the Liquidating Trustees.
12.2 MEETING CALLED BY LIQUIDATING TRUSTEES. A majority of the
Liquidating Trustees then serving may at any time call a meeting of the
Beneficiaries to be held at such time and at such place within or outside
the State of Illinois as the Liquidating Trustees shall determine. Written
notice of every meeting of the Beneficiaries shall be given by the
Liquidating Trustees (except as provided in Section 12.3), which written
notice will set forth the time and place of such meeting and in general
terms the action proposed to be taken at such meeting and shall be mailed
not more than 60 nor less than 10 days before such meeting is to be held to
all of the Beneficiaries of record not more than 60 days before the date of
such meeting. The notice shall be directed to the Beneficiaries at their
respective addresses as they appear in the records of the Liquidating
Trustees.
<PAGE>
12.3 MEETING CALLED ON REQUEST OF BENEFICIARIES. Within 30 days
after written request to the Liquidating Trustees by Beneficiaries having
aggregate Beneficial Interests of 10% or more of all Beneficial Interests
to call a meeting of all the Beneficiaries, which written request shall
specify in reasonable detail the action proposed to be taken, the
Liquidating Trustees shall proceed under the provisions of Section 12.2 to
call a meeting of the Beneficiaries, and if the Liquidating Trustees fail
to call such meeting within such 30-day period then such meeting may be
called by the Beneficiaries having aggregate Beneficial Interests of 10% or
more of all Beneficial Interests or by their designated representative.
12.4 PERSONS ENTITLED TO VOTE AT MEETING OF BENEFICIARIES. Each
Beneficiary retaining rights to distributions from the Liquidating Trust
Estate on the record date shall be entitled to vote at a meeting of the
Beneficiaries either in person or by his proxy duly authorized in writing.
The signature of the Beneficiary on such written authorization need not be
witnessed or notarized.
12.5 QUORUM. At any meeting of Beneficiaries, the presence of
Beneficiaries having aggregate Beneficial Interests sufficient to take
action on any matter for the transaction of which such meeting was called
shall be necessary to constitute a quorum, but if less than a quorum be
present, Beneficiaries having aggregate Beneficial Interests of more than
50% of the aggregate Beneficial Interests of all Beneficiaries represented
at the meeting may adjourn such meeting with the same effect and for all
intents and purposes as though a quorum had been present.
12.6 ADJOURNMENT OF MEETING. Any meeting of Beneficiaries at which
a quorum is present may be adjourned from time to time and a meeting may be
held at such adjourned time and place without further notice.
12.7 CONDUCT OF MEETINGS. The Liquidating Trustees shall appoint the
Chairman and the Secretary of the meeting. The vote upon any resolution
submitted to any meeting of Beneficiaries shall be by written ballot. The
Chairman of the meeting shall count all votes cast at the meeting for or
against any resolution and shall make and file with the Secretary of the
meeting his verified written report.
12.8 RECORD OF MEETING. A record of the proceedings of each meeting
of Beneficiaries shall be prepared by the Secretary of the meeting. The
record shall be signed and verified by the Secretary of the meeting and
shall be delivered to the Liquidating Trustees to be preserved by them. Any
record so signed and verified shall be conclusive evidence of all the
matters therein stated.
12.9 ACTION WITHOUT A MEETING. Any action may be taken by the
Beneficiaries without a meeting, without prior notice and without a vote,
if a consent in writing, setting forth the action so taken, shall be signed
by Beneficiaries having aggregate Beneficial Interests not less than the
percentage that would be necessary to authorize or take such action at a
meeting.
12.10 WAIVER OF NOTICE. Whenever notice is required to be given under
this Article, a written waiver thereof, signed by the person entitled to
notice, whether before or after the time stated in such Article for such
notice, shall be deemed equivalent to notice. Attendance of a person at a
meeting shall constitute a waiver of notice of such meeting. Neither the
business to be transacted at, nor the purpose of, any meeting of
Beneficiaries need be specified in any written waiver of notice.
12.11 REQUIRED VOTE. Unless specified elsewhere in this Agreement, a
vote of Beneficiaries holding aggregate Beneficial Interests of more than
50% of all Beneficial Interests is required to approve of any action or
proposal submitted to the Beneficiaries for a vote at a meeting.
<PAGE>
ARTICLE XIII.
AMENDMENTS
13.1 CONSENT OF BENEFICIARIES. At the direction or with the consent
(evidenced in the manner provided in Section 11.1) of Beneficiaries having
aggregate Beneficial Interests of more than 50% of all Beneficial
Interests, the Liquidating Trustees shall promptly make and execute a
declaration amending this Agreement for the purpose of adding any
provisions to or changing in any manner or eliminating any of the
provisions of this Agreement or amendments hereto, provided, however, that
no such amendment shall permit the Liquidating Trustees to engage in any
activity prohibited hereunder or affect the Beneficiaries' rights to
receive their pro rata shares of the Liquidating Trust Estate at the time
of distribution or otherwise materially and adversely affect the rights of
the Beneficiaries. In addition to any amendments otherwise authorized
herein, this Agreement may be amended from time to time by the Liquidating
Trustees, without the consent of any of the Beneficiaries, (i) to add to
the representations, duties or obligations of the Liquidating Trustees or
surrender any right or power granted to the Liquidating Trustees herein;
and (ii) to cure any ambiguity, to correct or supplement any provision
herein which may be inconsistent with any other provision herein, or to
make any other provisions with respect to matters or questions arising
under this Agreement which will not be inconsistent with the provisions of
this Agreement; provided, however, that no amendment shall be adopted
pursuant to this Section 13.1 unless the adoption thereof (1) is for the
benefit of or not adverse to the interests of the Beneficiaries; and (2)
does not alter the interest of a Beneficiary in any way without the consent
of the Beneficiaries adversely affected thereby.
13.2 NOTICE AND EFFECT OF AMENDMENT. Promptly after the execution
by the Liquidating Trustees of any such declaration of amendment, the
Liquidating Trustees shall give notice of the substance of such amendment
to the Beneficiaries or, in lieu thereof, the Liquidating Trustees may send
a copy of the amendment to each Beneficiary. Upon the execution of any
such declaration of amendment by the Liquidating Trustees, this Agreement
shall be deemed to be modified and amended in accordance therewith and the
respective rights, limitations of rights, obligations, duties and
immunities of the Liquidating Trustees and the Beneficiaries under this
Agreement shall thereafter be determined, exercised, and enforced hereunder
subject in all respects to such modification and amendment, and all the
terms and conditions of any such amendment shall be thereby deemed to be
part of the terms and conditions of this Agreement for any and all
purposes.
ARTICLE XIV.
MISCELLANEOUS PROVISIONS
14.1 FILING DOCUMENTS. This Agreement shall be filed or recorded in
the office of the Recorder of Deeds of Cook County, Illinois, and in such
other office or offices as the Liquidating Trustees may determine to be
necessary or desirable. A copy of this Agreement and all amendments
thereof shall be available at all reasonable times for inspection by any
Beneficiary or his duly authorized representative at 900 North Michigan
Avenue, Suite 1900, Chicago, Illinois, 60611. The Liquidating Trustees
shall file or record any amendment of this Agreement in the same places
where the original Agreement is filed or recorded. The Liquidating
Trustees shall file or record any instrument which relates to any change in
the office of Liquidating Trustees in the same places where the original
Agreement is filed or recorded.
<PAGE>
14.2 INTENTION OF PARTIES TO ESTABLISH LIQUIDATING TRUST; FEDERAL
INCOME TAX INTENTIONS. This Agreement is not intended to create and shall
not be interpreted as creating an association, partnership, corporation or
joint venture of any kind. It is intended as a trust to be governed and
construed in all respects as a trust. It is intended that the Liquidating
Trust be classified for federal income tax purposes as a "liquidating
trust" within the meaning of U.S. Treasury Regulation 301.7701-4(d). The
Beneficiaries are intended to be treated for federal income tax purposes as
having received the Funds from the Partnership in complete liquidation of
their Partnership Interests and then as having contributed the Funds to the
Liquidating Trust. The Beneficiaries will be treated as the grantors and
deemed owners of the Liquidating Trust and they will be treated for federal
income tax purposes as owning undivided interests in its assets.
14.3 LAWS AS TO CONSTRUCTION. This Agreement shall be governed by
and construed in accordance with the laws of the State of Illinois, and the
Partnership, the Liquidating Trustees, the partners of the Partnership and
the Partnership Interest Holders consent and agree that this Agreement
shall be governed by and construed in accordance with such laws.
14.4 SEPARABILITY. In the event any provision of this Agreement or
the application thereof to any person or circumstances shall be finally
determined by a court of proper jurisdiction to be invalid or unenforceable
to any extent, the remainder of this Agreement, or the application of such
provision to persons or circumstances other than those as to which it is
held invalid or unenforceable, shall not be affected thereby, and each
provision of this Agreement shall be valid and enforced to the fullest
extent permitted by law.
14.5 NOTICES. Any notice or other communication by the Liquidating
Trustees to any Beneficiary shall be deemed to have been sufficiently
given, for all purposes, if given by being deposited, postage prepaid, in a
post office or letter box addressed to such person at his address as shown
in the records of the Liquidating Trustees.
14.6 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but such counterparts
shall together constitute but one and the same instrument.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be signed, sealed and acknowledged, effective this _____ day of December,
1998.
LIQUIDATING TRUSTEES:
_________________________________
H. Rigel Barber
_________________________________
Jeffrey A. Gluskin
_________________________________
Gary Nickele
JMB INCOME PROPERTIES, LTD.-XIII
By: JMB Realty Corporation
Managing General Partner
By: ______________________________
Its ______________________________
By: ABPP Associates, L. P .
Associate General Partner
By: JMB Realty Corporation
General Partner
By: ____________________________
Its: ____________________________
By: Income Partners-XIII
Associate General Partner
By: AGPP Associates, L. P.
General Partner
By: JMB Realty Corporation
General Partner
By: ____________________________
Its: ____________________________
