FORM 8-K - CURRENT REPORT
UNITED STATES
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) July 16,1998
ANGELES INCOME PROPERTIES, LTD. 6
(Exact name of registrant as specified in its charter)
California 0-16210 95-4106139
(State or other jurisdiction (Commission (I.R.S. Employer
incorporation) File Number) Identification
Number)
One Insignia Financial Plaza
Post Office Box 1089
Greenville, South Carolina 29602
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (864) 239-1000
N/A
(Former name or former address, if changed since last report)
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
The Registrant sold Whispering Pines Mobile Home Park on July 16, 1998.
Whispering Pines Mobile Home Park was sold to Hometown America, L.L.C., an
unrelated party, for $7,050,000.
The Managing General Partner is currently evaluating its cash needs to determine
what portion of the net proceeds can be distributed to its partners in the near
future.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(b) Pro forma financial information.
The required pro forma financial information will be provided in the
Registrant's quarterly report on Form 10-QSB for the quarter ended June 30,
1998.
(c) Exhibits
10.21 Contract of Sale between Registrant and Hometown America, L.L.C.
effective July 16, 1998.
10.22 Amendment to Contract of Sale between Registrant and Hometown America,
L.L.C. effective July 16, 1998.
10.23 Second Amendment to Contract of Sale between Registrant and Hometown
America, L.L.C. effective July 16, 1998.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ANGELES INCOME PROPERTIES, LTD. 6
By: ANGELES REALTY CORPORATION II
Its General Partner
By: /s/ Carroll D. Vinson
President
Date: July 30, 1998
EXHIBIT 10.21
CONTRACT OF SALE
(WHISPERING PINES MOBILE HOME PARK)
THIS CONTRACT OF SALE (this "Contract") is made and entered into by and
between WHISPERING PINES AIP 6 LIMITED PARTNERSHIP, a South Carolina limited
partnership ("Seller"), and HOMETOWN AMERICA, L.L.C., a Delaware limited
liability company ("Purchaser").
ARTICLE I.
SALE OF THE PROPERTY
1.1 Property. For the consideration and upon and subject to the terms,
provisions and conditions of this Contract, Seller agrees to sell to Purchaser,
and Purchaser agrees to purchase from Seller, the following described property
(collectively, the "Property"):
(a) That certain tract or parcel of land (the "Land") located in Palm
Beach County, Florida, which is currently being used as a mobile home park
and is more particularly described on Exhibit A attached hereto and made a
part hereof for all purposes, together with all improvements, structures
and fixtures, if any, located on the Land (the "Improvements"), and all
rights, titles and interests of Seller appurtenant to the Land and
Improvements, including, without limitation, appurtenant easements,
adjacent roads, highways and rights-of-way;
(b) All tangible personal property of any kind (the "Personalty")
owned by Seller and attached to or located on the Land or Improvements,
including, without limitation, water wells, water supply systems, sewers,
sewage treatment systems and electric, gas, propane, cable, telephone and
other utility lines, equipment and distribution systems, if any exist
(collectively, the "Utilities");
(c) All of Seller's rights, titles and interests under any leases or
other agreements demising space in or providing for the use or occupancy of
the Improvements or Land (the "Tenant Leases"), and all unapplied deposits,
whether security or otherwise and prepaid rents ("Deposits"), paid by
tenants ("Tenants") under the Tenant Leases;
(d) All of Seller's rights, titles and interests in and to all
service, maintenance and management contracts affecting or entered into
with respect to the Property (the "Service Contracts") that Purchaser is
required to assume, as provided in Section 5.2 hereof, and all warranties,
guaranties and bonds in effect at Closing relating to the Land, the
Improvements or the Personalty, to the extent the same are assignable; and
(e) All transferable consents, authorizations, variances, licenses,
permits, governmental approvals, and certificates of occupancy, if any,
issued by any governmental authority with respect to the operation of the
Property (collectively, the "Governmental Permits").
ARTICLE II.
PURCHASE PRICE
2.1 Purchase Price. The total Purchase Price (herein so called) to be
paid by Purchaser to Seller for the Property shall be an amount equal to Seven
Million Fifty Thousand and No/100 Dollars ($7,050,000.00). The Purchase Price
shall be payable at the Closing (hereinafter defined) as follows:
(a) by the payment by Purchaser to Seller of cash or Current Funds
(defined below) in an amount equal the difference between (i) the Purchase
Price (as adjusted, if applicable, pursuant to Section 9.2(a) of this
Contract) and (ii) the unpaid principal balance of the Existing Notes
(defined below) as of the date of the Closing; and
(b) by Purchaser assuming all of the obligations of Seller under (i)
that certain First Mortgage Note dated as of September 30, 1993 (the "First
Note"), in the original principal amount of $5,144,880.00 executed by
Seller and payable to the order of Lexington Mortgage Company (together
with its successors and assigns referred to herein as the "Existing
Lender"), (ii) that certain Second Mortgage Note dated as of September 30,
1993 (the "Second Note"), in the original principal amount of $159,120.00
executed by the Seller and payable to the order of the Existing Lender (the
First Note and the Second Note being collectively referred to herein as the
"Existing Notes"), (iii) that certain First Mortgage and Security Agreement
executed by Seller for the benefit of the Existing Lender and dated as of
even date with the First Note (the "First Mortgage"), (iv) that certain
Second Mortgage and Security Agreement executed by Seller for the benefit
of the Existing Lender and dated as of even date with the Second Note (the
"Second Mortgage") (the First Mortgage and the Second Mortgage being
collectively referred to as the "Existing Mortgages"), and (v) all other
documents, instruments and agreements securing payment of the Existing
Notes or related to the Existing Notes or the Existing Mortgages (the
Existing Notes, the Existing Mortgages and any and all notes, mortgages,
assignments of leases and rents, security agreements, financing statements,
and other documents, instruments and agreements securing payment of the
Existing Notes or related to the Existing Notes or Existing Mortgages, as
the same may have been or may hereafter be amended, supplemented, renewed,
extended or restated, shall collectively be referred to herein as the
"Existing Loan Documents", and all indebtedness evidenced by the Existing
Loan Documents shall be referred to herein as the "Existing Loans").
Notwithstanding the Purchaser's assumption of Seller's obligations under
the Existing Loan Documents, it is understood and agreed that all funds
held by the Existing Lender in any escrow, reserve, capital improvements or
similar accounts pursuant to the terms of the Existing Loan Documents
(collectively, the "Existing Escrow Accounts") are held for the benefit of
Seller, and at Closing the Purchaser shall be obligated to pay to Seller,
in cash, the total amounts held in all such accounts as of the Closing
Date.
2.2 Assumption of Existing Loans. In connection with the Purchaser's
assumption of the obligations under the Existing Loan Documents, Purchaser and
Seller agree to execute and deliver all reasonable documents, instruments and
agreements, and to make a good faith effort in all actions, which the Existing
Lender reasonably requires pursuant to the Existing Loan Documents to obtain the
Existing Lender's acknowledgment and consent to the sale of the Property as
contemplated by this Contract. Without limitation of the obligations under the
preceding sentence, Purchaser agrees that it will, if required by the Loan
Documents, (i) create a new single purpose entity which will comply with the
requirements set forth in Section 56 of the Existing Mortgages to serve as the
owner of the Property; and (ii) appoint a new manager of the Property, which
will act pursuant to a management agreement satisfactory to Existing Lender, and
which manager and management agreement will satisfy the requirements of Section
54 of the Existing Mortgages, and Purchaser shall pay all reasonable costs and
expenses of the Existing Lender and its counsel in connection with the review
and approval of such new manager. Further, Purchaser agrees to make a good
faith effort to comply with each and every requirement of the Existing Loan
Documents which is reasonably required by the Existing Lender for Purchaser to
acquire the Property encumbered by the respective liens evidenced by the
Existing Loan Documents, including, without limitation, compliance with the
provisions of Section 9 of the Existing Mortgages. All fees, costs and expenses
payable to the Existing Lender in connection with its approval of the
transactions contemplated by this Contract and the Purchaser's assumption of the
Existing Loans shall be payable by Purchaser and Seller as follows:
(a) Purchaser shall pay all such fees, costs and expenses to the
extent that they do not exceed an aggregate of Thirty Thousand and No/100
Dollars ($30,000.00);
(b) If such fees, costs and expenses exceed Thirty Thousand and
No/100 Dollars ($30,000.00) Seller shall pay all such fees, costs and
expenses to the extent they are greater than Thirty Thousand and No/100
Dollars ($30,000.00) but less than or equal to Sixty Thousand and No/100
Dollars ($60,000.00); and
(c) In the event such fees, costs and expenses exceed Sixty Thousand
and No/100 Dollars ($60,000.00), Seller and Purchaser shall each pay of
such fees, costs and expenses in excess of Sixty Thousand and No/100
Dollars ($60,000.00).
ARTICLE III.
EARNEST MONEY DEPOSIT
3.1 Amount and Timing. Within three (3) business days after the Effective
Date, Purchaser shall deliver to Chicago Title Insurance Company, located at
1819 Main Street, Sarasota, Florida 34236, Attention: Ernie Wynn (the "Title
Company"), Two Hundred Thousand and No/100 Dollars ($200,000.00) (the "Earnest
Money Deposit") in cash or Current Funds, to be held by the Title Company in
escrow to be applied or disposed of by the Title Company as is provided in this
Contract. In the event Purchaser fails to deposit the Earnest Money Deposit
with the Title Company as herein provided, this Contract shall automatically
terminate, and neither Seller nor Purchaser shall have any further obligations
hereunder except for provisions of this Contract which expressly survive the
termination of this Contract. As used in this Contract, the term "Current
Funds" shall mean wire transfers, certified funds or a cashier's check in a form
acceptable to the Title Company which would permit the Title Company to
immediately disburse such funds.
3.2 Application and Interest. If the purchase and sale hereunder is
consummated, then the Earnest Money Deposit shall be applied to the Purchase
Price at Closing. In all other events, the Earnest Money Deposit shall be
disposed of by the Title Company as provided in this Contract. The Earnest
Money Deposit shall be invested in an interest-bearing account with a financial
institution and in a manner reasonably acceptable to Purchaser. All interest
earned on the Earnest Money Deposit is part of the Earnest Money Deposit, to be
applied or disposed of in the same manner as the Earnest Money Deposit under
this Contract.
3.3 Demand for Earnest Money Deposit. If for any reason the Closing does
not occur and either party makes a written demand upon the Title Company for
payment of the Earnest Money Deposit, the Title Company shall give written
notice to the other party of such demand. If the Title Company does not receive
a written objection from the other party to the proposed payment within ten (10)
days after the giving of such notice, the Title Company is hereby authorized to
make such payment. If the Title Company does receive such written objection
within such ten (10) day period or if for any other reason the Title Company in
good faith shall elect not to make such payment, the Title Company shall
continue to hold such amount until otherwise directed by written instructions
from both parties to this Contract or a final judgment of a court of competent
jurisdiction which is not subject to further appeal. The parties acknowledge
that the Title Company is acting solely as a stakeholder at their request and
for their convenience, that the Title Company shall not be deemed to be the
agent of either of the parties, except as expressly set forth herein, and that
the Title Company shall not be liable to either of the parties for any act or
omission on its part unless taken or suffered in bad faith, in willful disregard
of this Contract or of any escrow agreement or involving gross negligence. The
Title Company joins in the execution of this Contract solely for the purpose of
acknowledging receipt of the Earnest Money Deposit and its agreement to hold the
same pursuant to the terms hereof.
ARTICLE IV.
TITLE AND SURVEY
4.1 Title Commitment. Not later than fifteen (15) days after the
Effective Date, Seller shall cause to be furnished to Purchaser, a current ALTA
Commitment for Title Insurance for the Land and Improvements (the "Title
Commitment") issued by the Title Company. The Title Commitment shall set forth
the state of title to the Property, including a list of conditions or exceptions
to title affecting the Property that would appear in an Owner's Policy of Title
Insurance, if one were issued. The Title Commitment shall contain the expressed
commitment of the Title Company to issue the Title Policy (hereinafter defined)
to Purchaser in the amount of the Purchase Price, insuring the title to the
Property specified in the Title Commitment. At such time as the Title
Commitment is furnished to Purchaser, the Title Company shall also furnish to
Purchaser copies of instruments or documents (the "Exception Documents") that
create or evidence conditions or exceptions to title affecting the Property, as
described in the Title Commitment.
4.2 Survey. Seller has previously provided to Purchaser a copy of the
latest survey of the Land and Improvements ("Seller's Survey") in Seller's
possession. Not later than seven (7) days after the Effective Date, Purchaser
shall advise Seller whether or not the Seller's Survey is satisfactory (and if
Purchaser does not so advise Seller, the Seller's Survey shall be deemed to be
satisfactory to Purchaser). If Purchaser so notifies Seller that Seller's
Survey is not satisfactory to Purchaser or the Title Company, then Seller shall,
not later than five (5) days after it receives notification that such Seller's
Survey is not satisfactory, engage a surveyor, at Seller's cost, to prepare a
survey of the Property that is prepared by a land surveyor licensed by the State
of Florida and otherwise sufficient for Purchaser and the Title Company, and
that is certified to Seller, Purchaser and the Title Company, as having been
prepared in accordance with the 1992 minimum standard detailed requirements for
an Urban Land title Survey jointly adopted by the American Land Title
Association and the American Congress of Surveying and Mapping and, include (a)
Table Items 1-4 and 6-11, (b) a legal description of the Land, and (c) a
certification that no part of the Land is included in an area which has been
designated by the Secretary of Housing and Urban Development as a flood plane or
flood hazard area (the survey acceptable to Purchaser and Title Company is
hereinafter referred to as the "Survey").
4.3 Review of Title and Survey. Purchaser shall have until ten (10) days
after receipt of the last of the Title Commitment, Exception Documents, and
Survey in which to notify Seller in writing (the "Title Objection Notice") of
any objections Purchaser has to any matters shown or referred to in the Title
Commitment, the Exception Documents or on the Survey. Any title encumbrances,
exceptions or other matters which are set forth in the Title Commitment, the
Exception Documents or on the Survey, and to which Purchaser does not object
within the aforementioned ten (10) day period, shall be deemed to be permitted
exceptions to the status of Seller's title (such encumbrances, exceptions or
other matters, together with such other matters included pursuant to other
provisions of this Contract, shall be referred to as the "Permitted
Exceptions").
4.4 Objections to Status of Title and Survey. If Purchaser properly
objects to any item shown or referred to in the Title Commitment, Exception
Documents or Survey within the ten (10) day period set forth in Section 4.3,
Seller shall be given until ten (10) days after receipt of the Title Objection
Notice to notify Purchaser whether or not Seller will cure, prior to Closing and
at Seller's option and sole discretion but without any obligation to do so, any
objection to the condition of title raised by Purchaser. If Seller notifies
Purchaser that it elects not to cure any such objections, then Purchaser may, at
its option exercisable within five (5) days following the date of receipt by
Purchaser of written notice from Seller stating that Seller is unable or
unwilling to cure such objections, either (a) accept such title as Seller can
deliver, in which case all exceptions to title set forth in the Title
Commitment, Exception Documents and Survey which are not removed shall be deemed
to be Permitted Exceptions, or (b) terminate this Contract by notice in writing
to Seller in which event the Title Company shall return the Earnest Money
Deposit to Purchaser and neither party shall have any further rights, duties or
obligations hereunder, except for provisions of this Contract which expressly
survive termination of this Contract. In the event Purchaser fails to notify
Seller, within such five (5) day period, that Purchaser has elected to proceed
under either subpart (a) or (b) of the immediately preceding sentence, Purchaser
shall be deemed to have elected to proceed under subpart (a), and this Contract
shall remain in full force and effect. If Seller notifies Purchaser that it
elects to cure any such objections but is unable to cure same by Closing or if
Seller fails to notify Purchaser of its intentions with respect to such
objections and fails to cure same by Closing, then Purchaser may, at its option,
either (x) accept such title as Seller can deliver in which case the parties
shall proceed with Closing and all exceptions to title set forth in the Title
Commitment, Exception Documents and Survey which are not removed shall be deemed
to be Permitted Exceptions, or (y) terminate this Contract by notice in writing
to Seller at Closing, in which event the Title Company shall return the Earnest
Money Deposit to Purchaser and neither party shall have any further rights,
duties or obligations hereunder except for provisions of this Contract which
expressly survive termination of this Contract.
4.5 Other Permitted Exceptions. The Permitted Exceptions shall include
those matters shown in the Title Commitment and the Survey which become
Permitted Exceptions pursuant to Sections 4.3 and 4.4 above and, in addition,
the following: (a) the Tenant Leases; (b) taxes and assessments not yet due and
payable for the year in which Closing occurs and subsequent years; (c) liens and
encumbrances arising after the date hereof to which Purchaser consents in
writing; and (d) any liens or encumbrances of a definite or ascertainable amount
not exceeding $50,000.00, provided that (i) Seller causes such liens or
encumbrances to be released, insured or bonded around such that same do not
appear as an exception in the Title Policy issued to Purchaser pursuant to the
Title Commitment, and (ii) Seller agrees to indemnify Purchaser from all losses
incurred by Purchaser as a result of such liens or encumbrances.
ARTICLE V.
INSPECTION BY PURCHASER
5.1 Inspection Period. Seller has previously allowed Purchaser onto the
Property pursuant to an Access Agreement (herein so called) between Seller and
Purchaser dated February 19, 1998. Purchaser shall have a period of time
commencing on February 19, 1998, and expiring at 5:00 p.m., Greenville, South
Carolina time on the forty-fifth day thereafter (the "Inspection Period"),
within which to examine the Property and to conduct its feasibility study of the
Property. Seller agrees that, during the Inspection Period, Seller will allow
Purchaser and Purchaser's agents access to the Property during normal business
hours to conduct soil and engineering, hazardous waste, marketing, feasibility,
zoning and other studies or tests and to otherwise determine the feasibility of
the Property for Purchaser's intended use. Notwithstanding the foregoing,
(a) the costs and expenses of Purchaser's investigation shall be borne solely by
Purchaser, (b) prior to the expiration of the Inspection Period, Purchaser shall
restore the Property to the condition which existed prior to Purchaser's entry
thereon and investigation thereof to the extent the condition of the Property
was affected by or as a result of the actions of Purchaser or its agents,
contractors or representatives, (c) Purchaser shall not unreasonably interfere,
interrupt or disrupt the operation of Seller's business on the Property and,
further, such access by Purchaser and/or its agents shall be subject to the
rights of Tenants under Tenant Leases, (d) in the event the transaction
contemplated by this Contract does not close for any reason, Purchaser shall
deliver to Seller a descriptive listing of all tests, reports and inspections
conducted by Purchaser with respect to the Property and deliver copies thereof
to Seller, (e) Purchaser shall not permit any mechanic's or materialman's liens
or any other liens to attach to the Property by reason of the performance of any
work or the purchase of any materials by Purchaser or any other party in
connection with any studies or tests conducted pursuant to this Section 5.1,
(f) Purchaser shall give notice to Seller a reasonable time prior to entry onto
the Property and shall permit Seller to have a representative present during all
investigations and inspections conducted with respect to the Property, and
(g) Purchaser shall take all reasonable actions and implement all protections
necessary to ensure that all actions taken in connection with the investigations
and inspections of the Property, and all equipment, materials and substances
generated, used or brought onto the Property pose no material threat to the
safety of persons or the environment and cause no damage to the Property or
other property of Seller or other persons. All information made available by
Seller to Purchaser in accordance with this Contract or obtained by Purchaser in
the course of its investigations shall be treated as confidential information by
Purchaser, and, prior to the purchase of the Property by Purchaser, Purchaser
shall use its best efforts to prevent its agents and employees from divulging
such information to any third parties except as reasonably necessary to third
parties engaged by Purchaser for the limited purpose of analyzing and
investigating such information for the purpose of consummating the transaction
contemplated by this Contract, including Purchaser's attorneys and
representatives, prospective lenders and engineers. Purchaser shall indemnify,
defend and hold Seller harmless for, from and against any and all claims,
liabilities, causes of action, damages, liens, losses, costs and expenses
(including, without limitation, attorneys' fees) incident to, resulting from or
in any way arising out of any of Purchaser's and its agents', contractors' and
representatives' activities on the Property (whether before, on or after the
Effective Date), including, without limitation, any tests or inspections
conducted by Purchaser or its agents, contractors or representatives on the
Property. The agreements contained in this Section 5.1 shall survive the
Closing and not be merged therein and shall also survive any termination of this
Contract.
5.2 Approval of Inspections. If Purchaser determines at any time prior to
the expiration of the Inspection Period, that the Property is not satisfactory
to Purchaser in Purchaser's sole opinion and within Purchaser's sole discretion,
then Purchaser may deliver written notice of termination to Seller within such
Inspection Period, given in accordance with the provisions of Section 13.1
hereof, in which event the Title Company shall return the Earnest Money Deposit
to Purchaser and neither party shall have any further rights, liabilities or
obligations hereunder, except for provisions of this Contract which by their
terms expressly survive the termination of this Contract. If Purchaser does not
timely deliver written notice of termination within such Inspection Period, the
conditions of this Section 5.2 shall be deemed satisfied, and Purchaser shall be
deemed to have approved the condition of the Property and may not thereafter
terminate this Contract pursuant to this Section 5.2. Prior to the end of the
Inspection Period, Purchaser shall deliver written notice (the "Service Contract
Termination Notice") to Seller of any Service Contracts which Purchaser does not
wish to assume; provided, that Purchaser shall be required to assume any Service
Contracts which are not terminable by notice within the time between Seller's
receipt of such Service Contract Termination Notice and the Closing Date. Any
Service Contracts which Purchaser does not specify be terminated in the Service
Contract Termination Notice delivered prior to the end of the Inspection Period,
and any Service Contracts specified in the Service Contract Termination Notice
which cannot be terminated without penalty prior to the Closing Date, shall be
deemed approved by Purchaser and shall be assumed by Purchaser at Closing.
5.3 Matters to be Delivered by Seller. Seller has previously delivered
or, no later than ten (10) days from the Effective Date Seller shall deliver, to
Purchaser the following items (collectively, the "Submission Matters"):
(a) A current rent roll for the Property, and a copy of the
Prospectus and Rental Application used with respect to the Property;
(b) Copies of any and all Service Contracts relating to the ownership
and operation of the Property;
(c) Copies of the most recent (for the prior twelve (12) month
period) real estate and personal property tax statements and utility bills
received by Seller with respect to the Property;
(d) Any environmental (including, without limitation, asbestos) or
engineering studies, audits or reports regarding the Property which Seller
has in its possession; provided, that Purchaser is advised, and hereby
acknowledges, that such studies have not been addressed to or prepared for
Purchaser and, therefore, Purchaser may not rely upon the same.
(e) All surveys, as-built drawings, certificates of occupancy, and
governmental permits and licenses relating to the Property (including,
without limitation, the operation and provision of all Utilities thereon)
in Seller's possession; and
(f) Operating statements prepared for the Property for the two (2)
most recent preceding calendar years.
Seller will also allow Purchaser to review copies of existing Tenant Leases
at Seller's management office at the Property.
Purchaser agrees that if, for any reason, it does not purchase the
Property, Purchaser shall return to Seller all Submission Matters received by
Purchaser without retaining copies thereof.
ARTICLE VI.
REPRESENTATIONS AND WARRANTIES; DISCLAIMERS AND WAIVERS
6.1 Representations and Warranties of Purchaser. Purchaser represents and
warrants to Seller as of the date hereof and as of the Closing Date (hereinafter
defined) as follows (which representations and warranties shall survive the
Closing for a period of 270 days): (a) Purchaser is a limited liability company
duly organized and validly existing under the laws of the State of Delaware;
(b) Purchaser has full right and authority to enter into this Contract and to
consummate the transactions contemplated herein; (c) each of the persons
executing this Contract on behalf of Purchaser is authorized to do so; (d) this
Contract constitutes a valid and legally binding obligation of Purchaser,
enforceable in accordance with its terms; (e) Purchaser is, or at Closing will
be, a Single Purpose Entity Transferee (as defined in Section 9 of the Existing
Mortgages); (f) within twenty (20) days of the Effective Date, Purchaser shall
use its best efforts to deliver to the Existing Lender all documents,
certificates, opinions and other information required by the Existing Lender to
satisfy the provisions of Section 9 of the Existing Mortgages with respect to
the sale hereunder ("Assumption Approval Submission Items"); (g) Purchaser shall
use Hometown America Management, L.P., a Delaware limited partnership, as its
manager of the Property ("Purchaser's Property Manager"); and (h) Purchaser's
Property Manager (1) manages first-class multi-family residential complexes of
type similar to the Property, and (2) manages in the aggregate no less than
1,000 residential units.
6.2 Representations and Warranties of Seller. Seller represents and
warrants to Purchaser as of the date hereof and as of the Closing Date as
follows (which representations and warranties shall survive the Closing for a
period of 270 days):
(a) Seller is a limited partnership validly existing and duly
organized under the laws of the State of South Carolina;
(b) Subject to approval by the Existing Lender as contemplated
herein, Seller has full right and authority to enter into this Contract and
to consummate the transactions contemplated herein;
(c) each of the persons executing this Contract on behalf of Seller
is authorized to do so;
(d) this Contract constitutes a valid and legally binding obligation
of Seller, enforceable in accordance with its terms;
(e) Seller has no current actual knowledge of any person or entity
with any right of first refusal, option or similar rights to acquire any
interest in the Property or any material part thereof (other than the
rights of Tenants as set forth in the Rent Roll);
(f) To Seller's current actual knowledge, except as shown on (i) the
rent roll delivered pursuant to Section 5.3(a) (as to the representation
made on the date of this Contract), or (ii) the rent roll delivered on the
Closing Date pursuant to Section 8.2(a) below (as to the representation
made as of the Closing Date) (as applicable, the "Rent Roll"), there are no
persons in possession or occupancy of the Property, or any part thereof,
nor are there any persons who have possessory rights with respect to the
Property or any part thereof;
(g) To Seller's current actual knowledge, the Rent Rolls delivered
hereunder are true and correct in all material respects;
(h) To Seller's current actual knowledge, except with respect to any
matter specified in any Submission Matters (or other materials) delivered
to Purchaser (including, without limitation, that certain Environmental
Assessment prepared by Law Engineering and Environmental Services dated
July 16, 1993, as revised August 3, 1993), Seller has received no written
notice of any current or uncured violation of any (i) zoning, subdivision,
platting, building, fire, insurance, safety, health, environmental or other
applicable laws, ordinances or regulations, with respect to the Property or
the occupancy or operation thereof, (ii) permit, certificate or license
issued by a city, county or other governmental authority with respect to
the Property or the occupancy or operation thereof, or (iii) Service
Contract;
(i) To the Seller's current actual knowledge, neither the execution
or delivery of this Contract, the consummation of the transactions
contemplated hereby, nor the fulfillment of or compliance with the terms
and conditions hereof conflict with or result in a material breach of any
of the terms, conditions or provisions of any material agreement or
instrument to which the Seller is a party or by which Seller or the
Property is bound; and
(j) Seller has received no written notice of any claims, causes of
action, lawsuits or legal proceedings pending or threatened regarding the
ownership, use or possession of the Property or the provision of the
utilities thereto, including without limitation condemnation or similar
proceedings.
6.3. Survival/Knowledge. The representations and warranties contained in
this Contract shall survive the Closing Date for a period of 270 days from the
Closing Date. Any claim made under the representations and warranties contained
in this Contract must be asserted by filing a cause of action in a court of
competent jurisdiction against the party making such representation or warranty
within said two hundred seventy (270) day period, or such claim shall be forever
barred. As used herein, the term "Seller's current actual knowledge" shall mean
and refer to only the current actual knowledge of the Designated Representative
(as hereinafter defined) of the Seller and shall not be construed to refer to
the knowledge of any other partner, officer, director, agent, employee or
representative of the Seller, or any affiliate of the Seller, or to impose upon
such Designated Representative any duty to investigate the matter to which such
actual knowledge or the absence thereof pertains, or to impose upon such
Designated Representative any individual personal liability. As used herein,
the Term "Designated Representative" shall refer to James C. Hopke and Dan
Hicks.
6.4 NO ADDITIONAL REPRESENTATIONS OR WARRANTIES OF SELLER. PURCHASER
ACKNOWLEDGES AND AGREES THAT, EXCEPT AS EXPRESSLY SPECIFIED IN THIS CONTRACT OR
THE DEED TO BE DELIVERED AT CLOSING, SELLER HAS NOT MADE, AND SELLER HEREBY
SPECIFICALLY DISCLAIMS, ANY WARRANTY, GUARANTY OR REPRESENTATION, ORAL OR
WRITTEN, PAST, PRESENT OR FUTURE, OF, AS TO, OR CONCERNING, (a) THE NATURE AND
CONDITION OF THE PROPERTY, INCLUDING, WITHOUT LIMITATION, THE WATER, SOIL AND
GEOLOGY, AND THE SUITABILITY THEREOF AND OF THE PROPERTY FOR ANY AND ALL
ACTIVITIES AND USES WHICH PURCHASER MAY ELECT TO CONDUCT THEREON; (b) THE
EXISTENCE, NATURE AND EXTENT OF ANY RIGHT-OF-WAY, LEASE, RIGHT TO POSSESSION OR
USE, LIEN, ENCUMBRANCE, LICENSE, RESERVATION, CONDITION OR OTHER MATTER
AFFECTING TITLE TO THE PROPERTY; OR (c) WHETHER THE USE OR OPERATION OF THE
PROPERTY COMPLIES WITH ANY AND ALL LAWS, ORDINANCES OR REGULATIONS OF ANY
GOVERNMENT OR OTHER REGULATORY BODY. PURCHASER AGREES TO ACCEPT THE PROPERTY AND
ACKNOWLEDGES THAT THE SALE OF THE PROPERTY AS PROVIDED FOR HEREIN IS MADE BY
SELLER, ON AN "AS IS, WHERE IS, AND WITH ALL FAULTS" BASIS, EXCEPT FOR ANY
REPRESENTATIONS OR WARRANTIES EXPRESSLY SPECIFIED HEREIN. PURCHASER EXPRESSLY
ACKNOWLEDGES THAT EXCEPT AS OTHERWISE EXPRESSLY SPECIFIED HEREIN AND EXCEPT FOR
ANY WARRANTY OF TITLE CONTAINED IN THE DEED TO BE DELIVERED BY SELLER TO
PURCHASER AT CLOSING, SELLER MAKES NO REPRESENTATION OR WARRANTY OF ANY KIND,
ORAL OR WRITTEN, EXPRESS OR IMPLIED, OR ARISING BY OPERATION OF LAW, WITH
RESPECT TO THE PROPERTY, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTIES OR
REPRESENTATIONS AS TO HABITABILITY, MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE, TITLE (OTHER THAN SELLER'S WARRANTY OF TITLE TO BE SET FORTH IN THE
DEED), ZONING, TAX CONSEQUENCES, PHYSICAL OR ENVIRONMENTAL CONDITION, UTILITIES,
OPERATING HISTORY OR PROJECTIONS, VALUATION, GOVERNMENTAL APPROVALS, THE
COMPLIANCE OF THE PREMISES WITH GOVERNMENTAL LAWS, THE TRUTH, ACCURACY OR
COMPLETENESS OF ANY INFORMATION (INCLUDING, WITHOUT LIMITATION, THE SUBMISSION
MATTERS) PROVIDED BY OR ON BEHALF OF SELLER TO PURCHASER, OR ANY OTHER MATTER OR
THING REGARDING THE PROPERTY. PURCHASER ACKNOWLEDGES THAT EXCEPT AS EXPRESSLY
SPECIFIED IN ANY WRITTEN INSTRUMENT DELIVERED BY SELLER TO PURCHASER, SELLER
MAKES NO REPRESENTATION OR WARRANTY OF ANY KIND, ORAL OR WRITTEN, EXPRESS OR
IMPLIED, OR ARISING BY OPERATION OF LAW REGARDING OR WITH RESPECT TO ANY SUCH
INFORMATION (INCLUDING, WITHOUT LIMITATION, THE SUBMISSION MATTERS) PROVIDED OR
TO BE PROVIDED BY SELLER REGARDING THE PROPERTY.
FURTHER, AND WITHOUT IN ANY WAY LIMITING ANY OTHER PROVISION OF THIS
CONTRACT, EXCEPT AS EXPRESSLY SPECIFIED HEREIN SELLER HAS NOT MADE ANY
REPRESENTATION, WARRANTY OR GUARANTY, AND HEREBY SPECIFICALLY DISCLAIMS ANY
WARRANTY, GUARANTY OR REPRESENTATION, ORAL OR WRITTEN, PAST, PRESENT OR FUTURE,
WITH RESPECT TO THE PRESENCE OR DISPOSAL ON OR BENEATH THE PROPERTY (OR ANY
PARCEL IN PROXIMITY THERETO) OF HAZARDOUS SUBSTANCES OR MATERIALS WHICH ARE
CATEGORIZED AS HAZARDOUS OR TOXIC UNDER ANY LOCAL, STATE OR FEDERAL LAW,
STATUTE, ORDINANCE, RULE OR REGULATION PERTAINING TO ENVIRONMENTAL OR SUBSTANCE
REGULATION, CONTAMINATION, CLEANUP OR DISCLOSURE (INCLUDING, WITHOUT LIMITATION,
ASBESTOS) AND SHALL HAVE NO LIABILITY TO PURCHASER THEREFOR. WITHOUT LIMITATION
OF THE PRECEDING SENTENCE, SELLER SPECIFICALLY DISCLAIMS ANY REPRESENTATION,
WARRANTY OR GUARANTY REGARDING THE ACCURACY OF ANY ENVIRONMENTAL REPORTS WHICH
MAY BE INCLUDED WITHIN THE SUBMISSION MATTERS. BY ACCEPTANCE OF THIS CONTRACT
AND THE DEED TO BE DELIVERED BY SELLER AT THE CLOSING, PURCHASER ACKNOWLEDGES
THAT PURCHASER'S OPPORTUNITY FOR INSPECTION AND INVESTIGATION OF THE PROPERTY
(AND OTHER PARCELS IN PROXIMITY THERETO) WILL BE ADEQUATE TO ENABLE PURCHASER TO
MAKE PURCHASER'S OWN DETERMINATION WITH RESPECT TO THE PRESENCE OR DISPOSAL ON
OR BENEATH THE PROPERTY (AND OTHER PARCELS IN PROXIMITY THERETO) OF SUCH
HAZARDOUS SUBSTANCES OR MATERIALS, AND PURCHASER ACCEPTS THE RISK OF THE
PRESENCE OR DISPOSAL OF ANY SUCH SUBSTANCES OR MATERIALS. PURCHASER AGREES THAT
SHOULD ANY CLEANUP, REMEDIATION OR REMOVAL OF HAZARDOUS SUBSTANCES OR OTHER
ENVIRONMENTAL CONDITIONS ON THE PROPERTY BE REQUIRED AFTER THE DATE OF CLOSING,
SUCH CLEAN-UP, REMOVAL OR REMEDIATION SHALL BE THE RESPONSIBILITY OF AND SHALL
BE PERFORMED AT THE SOLE COST AND EXPENSE OF PURCHASER.
PURCHASER, AND ANYONE CLAIMING, BY, THROUGH OR UNDER PURCHASER, HEREBY
FULLY RELEASES AND DISCHARGES SELLER, ITS EMPLOYEES, OFFICERS, DIRECTORS,
PARTNERS, REPRESENTATIVES AND AGENTS, AND THEIR RESPECTIVE PERSONAL
REPRESENTATIVES, HEIRS, SUCCESSORS AND ASSIGNS FROM ANY COST, LOSS, LIABILITY,
DAMAGE, EXPENSE, DEMAND, ACTION OR CAUSE OF ACTION ARISING FROM OR RELATED TO
ANY CONSTRUCTION DEFECTS, ERRORS, OMISSION, OR OTHER CONDITIONS AFFECTING THE
PROPERTY; PROVIDED, THAT THIS SHALL NOT RELEASE SELLER FROM CLAIMS ARISING, IF
ANY, AS A RESULT OF ANY WRITTEN REPRESENTATION OR WARRANTY OF SELLER BEING FALSE
WHEN MADE. PURCHASER FURTHER ACKNOWLEDGES AND AGREES THAT THIS RELEASE SHALL BE
GIVEN FULL FORCE AND EFFECT ACCORDING TO EACH OF ITS EXPRESSED TERMS AND
PROVISIONS, INCLUDING, BUT NOT LIMITED TO, THOSE RELATING TO UNKNOWN AND
SUSPECTED CLAIMS, DAMAGES AND CAUSES OF ACTION. THIS COVENANT RELEASING SELLER
SHALL BE BINDING UPON PURCHASER, ITS PERSONAL REPRESENTATIVES, HEIRS, SUCCESSORS
AND ASSIGNS.
THE PROVISIONS OF THIS SECTION 6.4 (INCLUDING, WITHOUT LIMITATION, THE
WAIVER AND RELEASE OF CLAIMS CONTAINED HEREIN) SHALL SURVIVE THE CLOSING OR
EARLIER TERMINATION OF THIS CONTRACT.
6.5 No Reliance on Documents. Except as expressly stated herein or in any
written instrument delivered by Seller to Purchaser in connection herewith,
Seller makes no representation or warranty as to the truth, accuracy or
completeness of any materials, data or information (including, without
limitation, the Submission Matters) delivered by Seller to Purchaser in
connection with the transaction contemplated hereby. Purchaser acknowledges and
agrees that all materials, data and information (including, without limitation,
the Submission Matters) delivered by Seller to Purchaser in connection with the
transaction contemplated hereby are provided to Purchaser as a convenience only
and that any reliance on or use of such materials, data or information by
Purchaser shall be at the sole risk of Purchaser.
ARTICLE VII.
CONDITIONS PRECEDENT TO PURCHASER'S AND
SELLER'S PERFORMANCE
7.1 Conditions to Purchaser's Obligations. Purchaser's obligation under
this Contract to purchase the Property is subject to the fulfillment of each of
the following conditions (any or all of which may be waived by Purchaser):
(a) The representations and warranties of Seller contained herein
shall be true, accurate and correct as of the Closing Date;
(b) Seller shall be ready, willing and able to deliver title to the
Property in accordance with the terms and conditions of this Contract;
(c) Seller shall have delivered all the documents and other items
required pursuant to Section 8.2(a), and shall have performed, in all
material respects, all other covenants, undertakings and obligations, and
complied with all conditions required by this Contract to be performed or
complied with by the Seller at or prior to the Closing; and
(d) The Existing Lender shall have consented to the sale of the
Property pursuant to this Contract and the assumption by Purchaser of the
obligations with respect to the Existing Loans; provided, that the
Purchaser may not refuse to purchase the Property based upon a failure of
the condition set forth in this Section 7.1(d) if Purchaser has failed to
comply with its obligations as set forth in Sections 2.1(b), 2.2 and 7.3
hereof, or has breached its representations, warranties and agreements set
forth in Sections 6.1(e), 6.1(f), 6.1(g) or 6.1(h) hereof.
7.2 Conditions to Seller's Obligations. Seller's obligation under this
Contract to sell the Property to Purchaser is subject to the fulfillment of each
of the following conditions (all or any of which may be waived by Seller):
(a) the representations and warranties of Purchaser contained herein
shall be true, accurate and correct as of the Closing Date;
(b) Purchaser shall have delivered the funds required hereunder and
all the documents to be executed by Purchaser set forth in Section 8.2(b)
and shall have performed, in all material respects, all other covenants,
undertakings and obligations, and complied with all conditions required by
this Contract to be performed or complied with by Purchaser at or prior to
Closing; and
(c) The Existing Lender shall have consented to the sale of the
Property pursuant to this Contract, the assumption by Purchaser of the
obligations with respect to the Existing Loans, and the release of Seller
from all liability under the Existing Loan Documents accruing from and
after the Closing; provided that Seller may not refuse to sell the Property
based upon a failure of the condition set forth in this Section 7.2(c) if
Seller has failed to comply with its obligations as set forth in this
Contract related to the Existing Loans.
7.3 Requisite Approvals. Seller agrees that it will promptly seek the
requisite approval and consent to this Contract and to the sale and transfer of
the Property to Purchaser from the Existing Lender. Purchaser shall promptly
provide all documents, instruments and agreements (including, without
limitation, legal opinions) reasonably requested by the Existing Lender in
connection with obtaining its consent as aforesaid. In the event that Seller
has fulfilled its obligations under this Contract but has not obtained the
requisite approval to this Contract and the sale of the Property from the holder
of the Existing Loans prior to the Closing Date (as the same may be extended as
provided in Section 8.1 hereof or as may be agreed by Seller and Purchaser),
then either Seller or Purchaser may, at their option, terminate this Contract by
delivery of written notice of termination to the other party, whereupon the
Earnest Money Deposit shall be returned to Purchaser (unless Lender's failure to
provide such approval is due to a breach or default by Purchaser with respect to
its obligations under this Contract, in which event the Earnest Money Deposit
shall be delivered to Seller) and the parties shall have no further obligations
hereunder except for the provisions of this Contract which by the terms of this
Contract shall survive its termination.
ARTICLE VIII.
CLOSING
8.1 Time and Place. The consummation of the purchase and sale of the
Property (the "Closing") shall take place at the office of the Title Company (it
being contemplated that the Closing will occur by the delivery via courier, mail
or other delivery service of Closing documents into escrow with the Title
Company) on the thirtieth (30th) day after the end of the Inspection Period or
at such earlier date and time as Purchaser and Seller may mutually agree (the
"Closing Date"); provided, however, that Seller or Purchaser may, by delivery of
written notice to the other, extend the Closing Date for a period of up to sixty
(60) days in order to obtain the consent of the Existing Lender as contemplated
by Section 7.3 hereof.
8.2 Items to be Delivered at the Closing.
(a) Seller. At the Closing, Seller shall deliver, or cause to be
delivered, to the Title Company for recording or delivery to Purchaser, as
applicable, each of the following items:
(i) A standard form ALTA Owner Policy of Title Insurance ("Title
Policy") dated no earlier than the date of the filing of the deed
described in Section 8.2(a)(ii) hereof, issued by the Title Company,
and insuring Purchaser's title in the amount of the Purchase Price,
subject only to the Permitted Exceptions (the "Title Policy"). The
Title Policy shall contain, to the extent available in the State of
Florida: (a) extended coverage over all general exceptions, (b) an
ALTA 3.0 zoning endorsement, (c) an access endorsement, (d) a survey
endorsement, (e) a legal description equivalency endorsement, (f) a
contiguity endorsement, if applicable, and (g) an endorsement
providing coverage over creditors' rights exceptions.
(ii) A Special Warranty Deed duly executed and acknowledged by
Seller in the form attached hereto as Exhibit B and made a part hereof
for all purposes (with such reasonable changes thereto as may be
required by the Title Company in order to comply with the laws of the
State of Florida) sufficient to convey to Purchaser good and
indefeasible title to the Property free and clear of all liens and
encumbrances except for the Permitted Exceptions.
(iii) An Assignment and Assumption of Leases (the "Assignment
of Leases") duly executed and acknowledged by Seller in the form
attached hereto as Exhibit C and made a part hereof for all purposes.
(iv) A Blanket Conveyance, Bill of Sale and Assignment ("Bill of
Sale") duly executed by Seller in the form attached hereto as Exhibit
D and made a part hereof for all purposes.
(v) Letters addressed to the tenants of the Property (the
"Notice Letters") in the form attached hereto as Exhibit F and made a
part hereof for all purposes or in such other form as may be mutually
agreed upon by Seller and Purchaser.
(vi) A Non-Foreign Affidavit in the form attached hereto as
Exhibit E and made a part hereof for all purposes.
(vii) All amounts owing to Purchaser by Seller under Article
IX hereof.
(viii) Evidence reasonably satisfactory to Purchaser and the
Title Company that the person or persons executing this Contract and
the closing documents on behalf of Seller have full right, power and
authority to do so.
(ix) Rent Roll prepared with respect to the Property in the form
normally prepared by Seller which shall be certified as being true and
correct in all material respects as of a date not more than five (5)
business days prior to Closing.
(x) A recertification of the Seller's representations and
warranties as set forth in Section 6.2 above, as being true and
correct in all material respects as of Closing, but such
recertification shall not extend the survival period of such
representations and warranties, beyond that otherwise set forth
herein.
(xi) A consent letter from Existing Lender consenting to the
terms of the transaction contemplated by this Contract, acknowledging
the current outstanding principal balance of the First Note, the
Second Note and the other Existing Loan Documents and stating the
amount of funds held by Existing Lender in any escrow, reserve,
capital improvement or similar accounts pursuant to the terms of the
Existing Loan Documents or otherwise.
(xii) Other items reasonably requested by the Title Company
for the sale of the Property in accordance with this Contract or for
administrative requirements for consummating the Closing.
(b) Purchaser. At the Closing, Purchaser shall deliver to the Title
Company, for recording or delivery to Seller, as applicable, each of
the following items:
(i) Current Funds in an amount equal to the sum of (A) the cash
portion of the Purchase Price payable pursuant to Section 2.1(a)
hereof, (B) the aggregate balance of all amounts held in the Existing
Escrow Accounts as of the Closing Date, and (C) such additional funds
as may be necessary to cover Purchaser's share of the closing costs
and prorations hereunder.
(ii) The Assignment of Leases, duly executed and acknowledged by
Purchaser.
(iii) The Bill of Sale, duly executed by Purchaser.
(iv) Evidence reasonably satisfactory to Seller and the Title
Company that the person or persons executing this Contract and the
closing documents on behalf of Purchaser have full right, power and
authority to do so.
(v) The Notice Letters duly executed by Purchaser.
(vi) Other items reasonably requested by the Title Company for
the sale of the Property in accordance with this Contract or for
administrative requirements for consummating the Closing.
8.3 Costs of Closing. Except as otherwise herein provided, any and all
recording fees, documentary and deed stamp taxes, transfer taxes, and any and
all costs relating to the issuance of a standard ALTA title policy (but
excluding the charges for any endorsements thereto, which charges shall be paid
by Purchaser) shall all be paid by Seller. Any and all costs and expenses,
including, without limitation, recording costs, loan fees, the Existing Lender's
attorneys' fees, documentary stamp taxes, deed taxes, transfer taxes, intangible
taxes, mortgage taxes or other similar taxes, fees or assessments, relating to
(a) obtaining the Existing Lender's approval to the transaction contemplated by
this Contract, and/or (b) any financing obtained by Purchaser for the purchase
of the Property, shall be borne and paid exclusively by Purchaser (subject to
the limitations on Purchaser's obligations to pay the Existing Lender's fees,
costs and expenses as set forth in Section 2.2 of this Contract). Seller and
Purchaser shall each pay one-half (1/2) of any escrow fees charged by the Title
Company. All other expenses incurred by Seller and Purchaser with respect to
the Closing, including, but not limited to, the attorneys' fees and costs and
expenses incurred in connection with negotiating, preparing and closing the
transaction contemplated by this Contract, shall be borne and paid exclusively
by the party incurring same, unless otherwise expressly provided in this
Contract.
8.4 Prorations. All normal and customarily proratable items, including,
without limitation, prepaid rents, operating expenses and leasing commissions,
other expenses and fees, and payments relating to any Service Contracts or other
agreements affecting the Property which survive the Closing, shall be prorated
as of the Closing Date, Seller being charged and credited for all of same
attributable to the period up to the Closing Date (and credited for any amounts
paid by Seller attributable to the period on or after the Closing Date) and
Purchaser being responsible for, and credited or charged, as the case may be,
for all of same attributable to the period on and after the Closing Date. All
unapplied Deposits under Tenant Leases, if any, shall be transferred by Seller
to Purchaser at the Closing. Any real estate ad valorem, personal property
taxes or similar taxes for the Property, or any installment of assessments
payable in installments which installment is payable in the year of Closing,
shall be prorated to the Closing Date, based upon actual days involved. In
connection with the proration of real property taxes or installments of
assessments, such proration shall be based upon the assessed valuation and tax
rate figures for the year in which the Closing occurs to the extent the same are
available; provided, that in the event that actual figures (whether for the
assessed value of the Property or for the tax rate) for the year of Closing are
not available at the Closing Date, the proration shall be made using figures
from the preceding year for the figures which are unavailable for the year of
Closing. The proration shall be final and unadjustable except as provided in
the following paragraph. The provisions of this Section 8.4 shall survive the
Closing.
If any of the items subject to proration under the foregoing provisions of
this Section 8.4 cannot be prorated at the Closing because of the unavailability
of the information necessary to compute such proration, or if any errors or
omissions in computing prorations at the Closing are discovered subsequent to
the Closing, then such item shall be reapportioned and such errors and omissions
corrected as soon as practicable after the Closing Date and the proper party
reimbursed, which obligation shall survive the Closing for a period (the
"Proration Period") from the Closing Date until one hundred twenty (120) days
after the Closing Date; provided, that with respect to ad valorem real and
personal property taxes, the Proration Period shall be from the Closing Date
until the earlier of (i) thirty (30) days after delivery of the respective tax
bill, or (ii) December 31, 1998. Neither party hereto shall have the right to
require a recomputation of a Closing proration or a correction of an error or
omission in a Closing proration unless within the Proration Period one of the
parties hereto (i) has obtained the previously unavailable information or has
discovered the error or omission, and (ii) has given notice thereof to the other
party together with a copy of its good faith recomputation of the proration and
copies of all substantiating information used in such recomputation. The
failure of a party to obtain any previously unavailable information or discover
an error or omission with respect to an item subject to proration hereunder and
to give notice thereof as provided above within the Proration Period shall be
deemed a waiver of its right to cause a recomputation or a correction of an
error or omission with respect to such item after the Closing Date.
8.5 Possession and Closing. Possession of the Property shall be delivered
to Purchaser by Seller at the Closing, subject to the Permitted Exceptions and
the rights of the Tenants. Purchaser shall make its own arrangements for the
provision of public utilities to the Property and Seller shall terminate its
contracts with such utility companies that provide services to the Property.
8.6 Delinquent Rent.
(a) Application of Delinquent Rent. If on the Closing Date any
Tenant is in arrears in the payment of any rent under any Tenant Lease (the
"Delinquent Rent") payable by it, any Delinquent Rent received by Purchaser
and Seller from such Tenant after the Closing shall be applied to amounts
due and payable by such Tenant during the following periods in the
following order of priority: (A) first, to the period of time on or after
the Closing Date, and (B) second, to the period of time before the Closing
Date. If Delinquent Rent or any portion thereof received by Seller or
Purchaser after the Closing are due and payable to the other party by
reason of this allocation, the appropriate sum, less a proportionate share
of any reasonable attorneys' fees and costs and expenses expended in
connection with the collection thereof, shall be promptly paid to the other
party. The provisions of this Section 8.6(a) shall survive the Closing.
(b) Collection of Delinquent Rent. After the Closing, Seller shall
continue to have the right, in its own name, to demand payment of and to
collect Delinquent Rent owed to Seller by any Tenant, provided, however,
such right shall not include the commencement or continuation of legal
actions or proceedings against any Tenant (but Seller may notify credit
reporting agencies of delinquencies by such Tenants), and the delivery of
the Assignment of Leases [as defined in Section 8.2(a)(iii)] shall not
constitute a waiver by Seller of such right. Subject to the limitations
set forth in the preceding sentence, Purchaser agrees to cooperate with
Seller in connection with all efforts by Seller to collection such
Delinquent Rent and to take all steps, whether before or after the Closing
Date, as may be necessary to carry out the intention of the foregoing,
including, without limitation, the delivery to Seller, upon demand, of any
relevant books and records (including, without limitation, rent statements,
receipted bills and copies of tenant checks used in payment of such rent),
the execution of any and all consents or other documents, and the
undertaking of any act reasonably necessary for the collection of such
Delinquent Rent by Seller. The provisions of this Section 8.6(b) shall
survive the Closing.
ARTICLE IX.
CONDEMNATION OR CASUALTY
9.1 Condemnation.
(a) In the event that all or any substantial portion of the Property
is condemned or taken by eminent domain or conveyed by deed in lieu
thereof, or if any condemnation proceeding is commenced for all or any
substantial portion of the Property, (i) Seller shall notify Purchaser of
such action promptly upon Seller's learning of such action, and (ii)
Purchaser may elect to terminate this Contract by written notice thereof to
the other party within ten (10) days after Seller notifies Purchaser of the
condemnation, taking or deed in lieu or institution of such condemnation
proceeding. If Purchaser does not terminate this Contract as aforesaid,
then both parties shall proceed to close the transaction contemplated
herein pursuant to the terms hereof, in which event Seller shall deliver to
Purchaser at the Closing any proceeds actually received by Seller
attributable to the Property from such condemnation, eminent domain
proceeding or deed in lieu thereof and assign its interest in and to any
such proceeds, and there shall be no reduction in the Purchase Price. In
the event less than a substantial portion of the Property shall be taken or
conveyed as explained in this Section 9.1(a), then the parties shall
proceed in accordance with the second sentence in this Section 9.1(a).
(b) For the purpose of this Section 9.1(a), a "substantial portion"
of the Property shall be deemed to be any portion of the Property with
either a fair market value or replacement cost in an amount equal to or
greater than $350,000.00. The foregoing provision shall survive the
Closing.
9.2 Casualty.
(a) In the event that all or any substantial portion of the Property
shall be damaged or destroyed by fire or other casualty prior to Closing,
(i) Seller shall notify Purchaser of such casualty promptly upon Seller's
learning of such casualty, (ii) Purchaser may terminate this Contract by
written notice thereof to Seller within ten (10) days after Seller notifies
Purchaser of the casualty. If Purchaser does not terminate this Contract
as aforesaid, then both parties shall proceed to close the transaction
contemplated herein pursuant to the terms hereof, in which event Seller
shall deliver to Purchaser at the Closing any insurance proceeds actually
received by Seller attributable to the Property from such casualty (except
for proceeds previously used to repair the Property to the extent that
immediate repairs are reasonably necessary) and assign to Purchaser all of
Seller's right, title and interest in and to any claims which Seller may
have under the insurance policies covering the Property, and the Purchase
Price shall be reduced by the aggregate amount of any deductibles
applicable under such insurance policies with respect to such casualty
loss. In the event less than a substantial portion of the Property shall
be damaged or destroyed by fire or other casualty prior to Closing, then
the parties shall proceed in accordance with the second sentence in this
Section 9.2(a).
(b) For the purposes of Section 9.2(a), a "substantial portion" of
the Property shall be deemed to be any portion of the Property with either
a fair market value or replacement cost in an amount equal to or greater
than $350,000.00. The foregoing provision shall survive the Closing.
ARTICLE X.
DEFAULTS AND REMEDIES
10.1 Default by Purchaser. If Seller shall not be in default hereunder and
Purchaser refuses or fails to consummate the Closing under this Contract for
reasons other than as expressly set forth in Section 4.4, Section 5.2 or Article
IX hereof or other than due to a failure of a condition precedent to Purchaser's
obligation to close as set forth in Section 7.1 hereof, Seller shall, as its
sole and exclusive remedy, terminate this Contract in which event neither party
shall have any further rights, duties, or obligations hereunder except for
provisions of this Contract which expressly survive the termination hereof, and
Seller shall be entitled to receive or retain the Earnest Money Deposit as
liquidated damages (Seller and Purchaser hereby acknowledging that the amount of
damages in the event of Purchaser's default is difficult or impossible to
ascertain but that such amount is a fair estimate of such damage).
Notwithstanding anything contained in this Section to the contrary, in the event
of Purchaser's breach of any indemnity, representation or warranty which by the
terms of this Contract survives the Closing or termination of this Contract,
Seller shall have any and all rights and remedies available at law or in equity
by reason of such default; provided, that in no event shall Purchaser be liable
to Seller for any punitive, speculative or consequential damages or damages for
loss of opportunity or lost profit.
10.2 Default by Seller. If Purchaser shall not be in default hereunder and
if Seller refuses or fails to consummate the Closing under this Contract other
than due to a termination permitted hereunder or a failure of a condition
precedent to Seller's obligation to close as set forth in Section 7.2 hereof,
Purchaser may, at Purchaser's sole option and as its sole and exclusive
remedies, either (a) terminate this Contract in which event neither party shall
have any further rights, duties or obligations hereunder except for provisions
of this Contract which expressly survive the termination hereof, and Purchaser
shall be entitled to a refund of the Earnest Money Deposit, or (b) enforce
specific performance of this Contract against Seller and recover the costs of
enforcing such action. In no event shall Seller be liable to Purchaser for any
damages, including, without limitation, any actual, punitive, speculative or
consequential damages or damages for loss of opportunity or lost profit.
Notwithstanding anything contained in this Section to the contrary, in the event
of Seller's breach of any indemnity, representation or warranty which by the
terms of this Contract survives the Closing or termination of this Contract,
Purchaser shall have any and all rights and remedies available at law by reason
of such default; provided, that in no event shall Seller be liable to Purchaser
for any punitive, speculative or consequential damages or damages for loss of
opportunity or loss of profit.
10.3 Attorneys' Fees. If it shall be necessary for either Purchaser or
Seller to employ an attorney to enforce its rights pursuant to this Contract,
the non-prevailing party shall reimburse the prevailing party for its reasonable
attorneys' fees.
ARTICLE XI.
BROKERAGE COMMISSIONS
11.1 Brokerage Commission. Seller and Purchaser represent each to the
other that each has had no dealings with any broker, finder or other party
concerning the purchase of the Property. Seller agrees to indemnify Purchaser
and hold Purchaser harmless from any loss, liability, damage, cost or expense
(including, without limitation, reasonable attorneys' fees) arising out of or
paid or incurred by Purchaser by reason of any claim to any broker's, finder's
or other fee in connection with this transaction by any party claiming by,
through or under Seller. Purchaser agrees to indemnify Seller and hold Seller
harmless from any loss, liability, damage, cost or expense (including, without
limitation, reasonable attorneys' fees) arising out of or paid or incurred by
Seller by reason of any claim to any broker's, finder's or other fee in
connection with this transaction by any party claiming by, through or under
Purchaser. Notwithstanding anything to the contrary contained herein, the
indemnities set forth in this Article XI shall survive the Closing.
ARTICLE XII.
CERTAIN OBLIGATIONS OF THE PARTIES
12.1 Operation of the Property Prior to the Closing. Between the Effective
Date and the Closing Date, Seller shall:
(a) lease, operate, manage and enter into contracts with respect to
the Property, in the same manner done by Seller prior to the date hereof;
(b) maintain the Property in the condition in which it existed as of
the date of this Contract, normal wear and tear excepted; not commit waste
of or on the Property; operate the Property in a manner consistent with and
in compliance with all applicable laws; and perform its obligations under
the Leases, and the Service Contracts;
(c) advise Purchaser of the commencement of any litigation,
condemnation or other judicial or administrative proceedings affecting the
Property of which Seller has current actual knowledge;
(d) not enter into any contract with respect to or affecting the
Property which would affect or bind Purchaser following the Closing Date,
without Purchaser's prior written consent;
(e) promptly advise Purchaser in writing of any changes in
circumstances which would render the representations and warranties made by
Seller herein false or misleading;
(f) comply with all applicable laws affecting the conveyance of the
Property, including, without limitation, any laws which require the giving
of notice of the transaction contemplated by this Contract to Tenants or
any association of Tenants; and
(g) deliver to Purchaser (i) a revised Rent Roll in the event of any
material changes to the Rent Roll previously delivered, (ii) copies of any
written amendments to any Service Contracts after the Effective Date but
prior to Closing, and (iii) copies of any written notices of any violations
of law or threatened litigation received by Seller after the Effective Date
but prior to Closing.
12.2 Application for Operating Permit. Purchaser shall promptly apply to
the applicable governmental authorities in the State of Florida for a permit to
operate the mobile home park located on the Property, as contemplated by Florida
Statutes Section 513.02. Purchaser shall provide Seller with a copy of its
application promptly upon making the same and will provide Seller with any
official actions with respect thereto within five (5) days after Purchaser's
receipt of notice of the same. In the event that the Purchaser's application to
operate the Property is not approved, and the permit obtained, by the Closing
Date, Purchaser shall nonetheless be obligated to purchase the Property pursuant
hereto, and the Purchaser shall bear any risk associated with not obtaining the
permit to operate the mobile home park located on the Property.
12.3 Purchaser's Special Representations and Warranties. Purchaser and
Seller each warrant and represent to the other that the following statements are
true for the purpose of demonstrating pursuant to Section 723.071(2), Florida
Statutes (1996) that the owners of mobile homes within the Property have no
right of first refusal to purchase the Property pursuant to Section 723.071(1),
Florida Statutes (1996):
(a) Seller has at no time requested, sought, or otherwise solicited
Purchaser's purchase of the Property;
(b) The negotiation of this Contract was initiated by Purchaser's
unsolicited offer to purchase the Property; and
(c) Purchaser was not made aware of the Property by any broker
engaged by or advertising initiated by Seller, but only by Purchaser's own
investigations.
Purchaser agrees that at the request of Seller that it and its agents and
representatives will sign affidavits and make other statements under oath
attesting to the accuracy of the foregoing representations and warranties, and
Purchaser shall indemnify, defend and hold Seller harmless for, from and against
any claims, actions, causes of action, losses, damages, liabilities, costs and
expenses suffered or incurred by Seller as a result of any such representations
and warranties being false or incorrect. Purchaser has made the foregoing
representations and warranties as material inducements to Seller to enter into
this Contract, and the rescission or contradiction by Purchaser of these
statements shall constitute a material default of this Contract. The
obligations and liabilities of the Purchaser under this Section 12.3 shall
survive the Closing or termination of this Contract.
ARTICLE XIII.
MISCELLANEOUS
13.1 Notices. Any notice provided or permitted to be given under this
Contract must be in writing and may be served by (a) depositing same in the
United States mail, addressed to the party to be notified, postage prepaid and
registered or certified with return receipt requested, (b) delivering the same
in person to such party via a hand delivery service, Federal Express or any
other nationally recognized courier service that provides a return receipt
showing the date of actual delivery of same to the addressee thereof, or
(c) facsimile transmission with confirmation of receipt to the party sending
same, if a copy is deposited in the United States Mail as provided in 13.1(a)
above. Notice given in accordance herewith shall be effective upon receipt at
the address of the addressee. For purposes of notice, the addresses of the
parties shall be as follows:
If to Seller: Whispering Pines AIP 6 Limited Partnership
One Insignia Financial Plaza
P.O. Box 1089
Greenville, South Carolina 29602
Attention: James C. Hopke
Facsimile No.: 864/239-1066
Telephone No.: 864/239-2816
With a copy to: Liechty & McGinnis, P.C.
10440 North Central Expressway, Suite 1100
Dallas, Texas 75231
Attention: Lorne O. Liechty, Esq.
Facsimile No.: 214/265-0615
Telephone No.: 214/265-0008
If to Purchaser:Hometown America, L.L.C.
Three First National Plaza
70 West Madison, Suite 4030
Chicago, Illinois 60602
Attention: Vincent W. McBrien
Facsimile No.: ______________
Telephone No.: _____________
With a copy to:Hopkins & Sutter
Three First National Plaza, Suite 4000
Chicago, Illinois 60602
Attention: Scott A. Drane, Esq.
Facsimile No.: 312/558-7760
Telephone No.: 312/558-6587
If to Title
Company: Chicago Title Insurance Company
1819 Main Street
Sarasota, Florida 34236
Attention: Ernie Wynn
Facsimile No.: 941/955-2017
Telephone No.: 941/955-7920
13.2 GOVERNING LAW. THIS CONTRACT IS BEING EXECUTED AND DELIVERED, AND IS
INTENDED TO BE PERFORMED IN, THE STATE OF FLORIDA, AND THE LAWS OF SUCH STATE
SHALL GOVERN THE VALIDITY, CONSTRUCTION, ENFORCEMENT AND INTERPRETATION OF THIS
CONTRACT.
13.3 Entirety and Amendments. This Contract embodies the entire agreement
between the parties and supersedes all prior agreements (including, without
limitation, the Access Agreement) and understandings, if any, relating to the
transaction described herein, and may be amended or supplemented only by an
instrument in writing executed by the party against whom enforcement is sought.
13.4 Parties Bound. Subject to the provisions of Section 13.5 hereof, this
Contract shall be binding upon and inure to the benefit of Seller and Purchaser,
and their respective heirs, personal representatives, successors and assigns.
13.5 Assignment. Except as provided in this Section 13.5, this Contract
may not be assigned in whole or in part by Purchaser without the prior written
consent of Seller. Any assignment of this Contract by Purchaser other than as
expressly permitted in this Section 13.5 shall, at Seller's option, be null and
void and of no effect. In the event Seller consents to an assignment of this
Contract by Purchaser, or if an assignment is made without Seller's consent,
Purchaser shall not be released from any liability or obligations hereunder.
Notwithstanding anything contained in this Contract, Purchaser may assign all of
its right, title and interest in this Contract to any entity owned by or under
common control with Purchaser. Any assignment permitted hereunder shall be
effected by a written assignment and assumption agreement (reasonably
satisfactory to Seller) between Purchaser and its assignee. Upon delivery of an
executed original of such assignment and assumption agreement to Seller, the
assignee shall become the "Purchaser" for all purposes of this Contract.
13.6 Headings. Headings used in this Contract are used for reference
purposes only and do not constitute substantive matter to be considered in
construing the terms of this Contract.
13.7 Survival. Except as otherwise expressly provided herein, no
representations, warranties, covenants, acknowledgments or agreements contained
in this Contract shall survive the Closing of this Contract and the delivery of
the Special Warranty Deed by Seller to Purchaser.
13.8 Interpretation. The parties acknowledge that each party and its
counsel have reviewed this Contract, and the parties hereby agree that the
normal rule of construction to the effect that any ambiguities are to be
resolved against the drafting party shall not be employed in the interpretation
of this Contract or any amendments or exhibits hereto. In case any one or more
of the provisions contained in this Contract shall for any reason be held to be
invalid, illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provisions hereof, and this Contract
shall be construed as if such invalid, illegal or unenforceable provisions had
never been contained herein. When the context in which words are used in this
Contract indicates that such is the intent, words in the singular number shall
include the plural and vice versa, and words in the masculine gender shall
include the feminine and neuter genders and vice versa.
13.9 Exhibits. All references to "Exhibits" contained herein are
references to exhibits attached hereto, all of which are hereby made a part
hereof for all purposes.
13.10 Time of Essence. It is expressly agreed by the parties hereto
that time is of the essence with respect to this Contract and Closing hereunder.
13.11 Multiple Counterparts. To facilitate execution, this Contract
may be executed in as many counterparts as may be convenient or required. It
shall not be necessary that the signature or acknowledgment of, or on behalf of,
each party, or that the signature of all persons required to bind any party, or
the acknowledgment of such party, appear on each counterpart. All counterparts
shall collectively constitute a single instrument. It shall not be necessary in
making proof of this Contract to produce or account for more than a single
counterpart containing the respective signatures of, or on behalf of, and the
respective acknowledgments of, each of the parties hereto. Any signature or
acknowledgment page to any counterpart may be detached from such counterpart
without impairing the legal effect of the signatures or acknowledgments thereon
and thereafter attached to another counterpart identical thereto except having
attached to it additional signature or acknowledgment pages.
13.12 Risk of Loss. Risk of loss or damage to the Property, or any
part thereof, by fire or any other casualty from the date this Contract is fully
executed up to the time of delivering the Special Warranty Deed transferring
title to the Property to the Purchaser will be on the Seller and, thereafter,
will be on the Purchaser.
13.13 Effective Date. As used herein, the term "Effective Date" shall
mean for all purposes in this Contract the date on which the Title Company
acknowledges receipt of an original of the Contract executed by Purchaser and
Seller with all changes, if any, to the printed portion of this Contract
initialed by Purchaser and Seller.
13.14 Business Days. All references to "business days" contained
herein are references to normal working business days, i.e., Monday through
Friday of each calendar week, exclusive of federal and national bank holidays.
In the event that any event hereunder is to occur, or a time period is to
expire, on a date that is not a business day, such event shall occur, or such
time period shall expire, on the next succeeding business day.
13.15 No Recordation of Contract. In no event shall this Contract or
any memorandum hereof be recorded in the public records of the place in which
the Property is situated, and any such recordation or attempted recordation
shall constitute a breach of this Contract by the party responsible for such
recordation or attempted recordation.
IN WITNESS WHEREOF, the undersigned have executed this Contract effective
as of the Effective Date.
SELLER:
WHISPERING PINES AIP 6 LIMITED
PARTNERSHIP, a South Carolina limited
partnership
By: AIP 6 GP Limited Partnership, a South
Carolina limited partnership, its general
partner
By: Angeles Realty Corporation II,
a California corporation,
its general partner
By: /s/Robert D. Long
Its: Vice President
Dated: March 3, 1998
PURCHASER:
HOMETOWN AMERICA, L.L.C.,
a Delaware limited liability company
By: /s/Andrew L. Gedo
Its: Vice President
Dated: February 27, 1998
EXHIBIT 10.22
AMENDMENT TO CONTRACT OF SALE
This Amendment to Contract of Sale (this "Amendment") is executed effective
as of 3rd day of April, 1998, by and between WHISPERING PINES AIP 6 LIMITED
PARTNERSHIP, a South Carolina limited partnership ("Seller"), and HOMETOWN
AMERICA, L.L.C., a Delaware limited liability company ("Purchaser").
WITNESSETH:
WHEREAS, Seller and Purchaser executed and entered into that certain
Contract of Sale (the "Contract") with an Effective Date (as defined in the
Contract) of March 11, 1998, regarding certain real property situated in Palm
Beach County, Florida, as more particularly described therein; and
WHEREAS, Seller and Purchaser desire that the Contract be modified and
amended in certain respects.
NOW, THEREFORE, for and in consideration of the mutual covenants herein
contained and other good and valuable consideration, Seller and Purchaser do
hereby agree as follows:
1. The Contract is hereby amended such that the Inspection Period (as
defined in the Contract) shall be extended through April 24, 1998.
2. Any and all of the terms and provisions of the Contract shall, except
as expressly amended and modified hereby, remain in full force and effect.
3. This Amendment may be executed in any number of counterparts, any one
of which shall constitute an original and all counterparts being but one
instrument.
EXECUTED effective as of the date first above written.
SELLER:
WHISPERING PINES AIP 6 LIMITED
PARTNERSHIP, a South Carolina limited
partnership
By: AIP 6 GP Limited Partnership,
a South Carolina limited
partnership, its general partner
By: Angeles Realty Corporation
II, a California corporation,
its general partner
By: /s/Robert D. Long
Its: Vice President
PURCHASER:
HOMETOWN AMERICA, L.L.C.,
a Delaware limited liability company
By: /s/Andrew L. Gedo
Its: Vice President
EXHIBIT 10.23
SECOND AMENDMENT TO CONTRACT OF SALE
This Second Amendment to Contract of Sale is entered into effective as of
April 24, 1998 (this "Amendment"), by and between WHISPERING PINES AIP 6 LIMITED
PARTNERSHIP, a South Carolina limited partnership ("Seller"), and HOMETOWN
AMERICA, L.L.C., a Delaware limited liability company ("Purchaser").
WHEREAS, Seller and Purchaser entered into that certain Contract of Sale
with an Effective Date of March 11, 1998, which Contract of Sale was amended by
that certain Amendment to Contract of Sale entered into between Seller and
Purchaser dated effective as of April 3, 1998 (as so amended, the "Contract"),
pursuant to which Seller has agreed to sell, and Purchaser has agreed to
purchase from Seller, the Property more particularly described in the Contract;
WHEREAS, Purchaser has alleged that Seller has failed to properly advise
Tenants of the Property of certain information regarding "pass-on" charges which
have been charged to such Tenants during Seller's ownership of the Property;
WHEREAS, Seller has denied any liability for improperly notifying Tenants
of such pass-on charges; and
WHEREAS, Seller and Purchaser have agreed to modify the Contract to
establish an escrow account for certain losses which may be incurred by
Purchaser after Closing as a result of Seller's alleged failure to properly
advise Tenants of such pass-on charges, all pursuant to and in accordance with
the terms of this Amendment.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Seller and Purchaser do hereby
agree as follows:
1. Unless otherwise defined in this Amendment, each term used in this
Amendment with its initial letter capitalized which has been defined in the
Contract shall have the same meaning herein as given to such term in the
Contract.
2. The Contract is hereby amended to add a new Section 12.5 thereto which
shall read in its entirety as follows:
12.5 Pass-on Escrow. At the Closing, Purchaser and Seller shall enter
into an Escrow Agreement in the form attached hereto as Exhibit G, pursuant
to which Seller shall deliver into escrow with the Title Company $30,000.00
to be used in payment of claims incurred by Purchaser during the 180-day
period immediately following Closing as a result of Seller's failure to
properly inform Tenants of pass-on charges which were charged to Tenants
during Seller's period of ownership.
3. The third paragraph of Exhibit C to the Contract is hereby amended to
read in its entirety as follows:
In consideration of the foregoing assignment, Assignee hereby assumes,
and agrees to perform all of the obligations of Assignor under the Leases,
including, but not limited to, the obligation to refund any security
deposits and the payment of any deferred leasing commissions that become
payable after the date of this Assignment with respect to any of the
Leases, and indemnifies Assignor and holds Assignor harmless from all loss,
cost, liability and expense arising out of or in connection with the Leases
to the extent the same arises on or after the date hereof; provided, that
such indemnity shall include, and Assignee hereby assumes, all Pass-on
Charge Liability. Assignee takes the Leases subject to any existing
defaults thereunder. Assignor hereby agrees to indemnify and hold Assignee
harmless from all loss, cost, liability and expense arising out of or in
connection with the Leases to the extent the same arises prior to the date
hereof; provided, that such indemnity shall not apply with respect to
losses, costs, liabilities or expenses arising out of or in connection with
any delinquent rents under the Leases; provided, further, that such
indemnity shall not apply with respect to losses, liabilities, costs or
expenses arising out of or in connection with any Pass-on Charge Liability.
As used herein, the term "Pass-on Charge Liability" shall mean any and all
liability incurred as a result of improper charges to Tenants under any
leases or other agreements demising space in or providing for the use or
occupancy of any portion of the real property described on Exhibit A
hereto, or any improvements thereon, to the extent that such liability
arises from charges passed on to the Tenants for increases in ad valorem
taxes, assessments and utility charges.
4. The Contract is hereby amended to add thereto a new Exhibit G thereto
which be in the same form as Exhibit G attached to this Amendment.
5. Except as expressly amended by this Amendment, no term or provision of
the Contract is or shall be amended, modified or supplemented.
6. This Amendment may be executed in any number of identical counterparts
so long as each party hereto has signed one such counterpart. If so executed,
each of such counterparts is to be deemed an original for all purposes, and all
such counterparts shall, collectively, constitute one agreement, but in making
proof of this Amendment, it shall not be necessary to produce or account for
more than one such counterpart.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment
effective as of the date first set forth above.
SELLER:
WHISPERING PINES AIP 6 LIMITED
PARTNERSHIP, a South Carolina limited partnership
By: AIP 6 GP Limited Partnership,
a South Carolina limited partnership,
its general partner
By: Angeles Realty Corporation II,
a California corporation,
its general partner
By: /s/Robert D. Long
Its: Vice President
Dated: May 21, 1998
PURCHASER:
HOMETOWN AMERICA, L.L.C.,
a Delaware limited liability company
By: /s/Andrew L. Gedo
Its: Vice President
Dated: May 11, 1998
