<PAGE> 1
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): October 27, 1994
CADENCE DESIGN SYSTEMS, INC..
- - --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 1-10606 77-0148231
- - ------------------------------- ------------ -------------------
(State or other jurisdiction of (Commission (IRS Employer
incorporation) File Number) Identification No.)
555 River Oaks Parkway, San Jose, CA 95134
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(Address of principal executive offices)
Registrant's telephone number, including area code: (408) 943-1234
--------------
<PAGE> 2
ITEM 2: ACQUISITION OR DISPOSITION OF ASSETS.
On October 27, 1994, Cadence Design Systems, Inc., a Delaware
corporation (the "Registrant" or "Cadence"), acquired all third-party interests
in River Oaks Place Associates L.P. (the "Partnership"), a real estate
partnership in which Cadence was a 49% limited partner, pursuant to a letter
agreement dated August 17, 1994 (the "ROPA Agreement") among Cadence, Morris
Management Company ("Morris Management") and Morris Associates VI, L.P.
("Morris Associates"). Pursuant to the ROPA Agreement, Seely Properties,
Inc., a wholly-owned subsidiary of Cadence ("Seely"), acquired a 1% interest
in the Partnership that was owned by the general partner, Morris Management,
and Cadence acquired an additional 51% limited partner interest in the
Partnership that was owned by Morris Associates. The Registrant paid
approximately $6.1 million in cash for the partnership interests they acquired
from Morris Management and Morris Associates. The funds paid to Morris
Management and Morris Associates by Registrant came out of Registrant's working
capital. The Partnership owns land and improvements with four office buildings
which are leased to Cadence and are subject to a secured note and a deed of
trust in favor of Prudential Life Insurance Company in the approximate amount
of $23.7 million, which note is due August 1995. In connection with the
acquisition of the partnership interest from Morris Management and Morris
Associates, Cadence agreed to extend the term of its lease obligations by five
years. The consideration paid was negotiated on the basis of certain studies
and analyses of the land and improvements owned by the Partnership and
discussions with Morris Management and Morris Associates regarding the
condition and management of such land and improvements. Contemporaneously with
Cadence's acquisition of Morris Management and Morris Associates' interests in
the Partnership, the management agreement between Morris Management and the
Partnership was terminated.
ITEM 7: FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial Statements of Businesses Acquired.
None of the required financial statements are currently available.
Pursuant to paragraph (a)(4) of Item 7, the required financial statements will
Be filed as soon as practicable, but not later than January 13, 1995, unless
waived.
(b) Pro Forma Financial Information.
None of the required pro forma financial information is currently
available. Pursuant to paragraph (b)(2) of Item 7, the required pro forma
financial information will be filed as soon as practicable, but not later than
January 13, 1995, unless waived.
(c) Exhibits.
2.01 Letter Agreement dated August 17, 1994 among the Registrant, Morris
Management and Morris Associates, as amended.
2
<PAGE> 3
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date: November 14, 1994
CADENCE DESIGN SYSTEMS, INC.
BY: /s/ H. Raymond Bingham
-----------------------------
H. RAYMOND BINGHAM
Executive Vice President
and Chief Financial Officer
3
<PAGE> 4
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit
Number Description of Exhibit
- - ------- ----------------------
<S> <C>
2.01 Letter Agreement dated August 17, 1994 among the Registrant,
Morris Management and Morris Associates, as amended.
</TABLE>
<PAGE> 1
EXHIBIT 2.01
Letter Agreement dated August 17, 1994 among the Registrant, Morris Management
and Morris Associates, as amended.
<PAGE> 2
[LETTERHEAD]
CADENCE DESIGN SYSTEMS, INC.
555 River Oaks Parkway
San Jose, CA 95134
408-943-1234
408-943-0513 Fax
August 17, 1994
William Wilson & Associates
2929 Campus Drive, Suite 450
San Mateo, CA 94403
Attn: James W. Arce
Morris Management Company
Morris Associates VI, L.P.
2500 Sand Hill Road
Menlo Park, CA 94025
Re: Acquisition of Interests in
River Oaks Place Associates L.P.
Gentlemen:
This letter is responsive to Jim Arce's correspondence of April 15 and
May 20, 1994 on behalf of the Morris interests and to subsequent conversations
through which we explored acquisition alternatives for River Oaks Place
Associates L.P. ("the Partnership").
As of June 29, 1989, Morris Management Company (a California
corporation -- the "General Partner"), as general partner, and Cadence Design
Systems, Inc. ("Cadence") and Morris Associates VI, L.P. ("Morris"), as
limited partners, entered into a limited partnership agreement and formed the
Partnership. The General Partner has a one percent interest in the Partnership
as a general partner; Cadence and Morris respectively have 49% and 50% limited
partner interests in the Partnership. The Partnership owns land and
improvements with four office buildings (the "Project"), which is leased to
Cadence and encumbered by a deed of trust in favor of Prudential Life Insurance
Company ("Prudential") in the approximate amount of $25 million.
By this letter and on the terms and conditions set forth below, Cadence
offers to acquire all of Morris' limited partner interest in the Partnership
and the General Partner's general partner interests in the Partnership. By
accepting this offer and consummating the transactions contemplated hereby,
Cadence will be the only limited partner of the Partnership
<PAGE> 3
William Wilson & Associates
Morris Management Company
August 17, 1994
Page 2
and Cadence or its affiliate will become the sole general partner of the
Partnership and all parties will release and waive prior claims against the
others except as set forth below.
1. Price, Cadence will pay the sum of $6,100,000 in cash at Closing
for the interests to be acquired hereunder. 98.04% of that amount will be
allocated to the acquisition of the Morris Project Interest, as defined in
Paragraph 2 (the "LP Price") and 1.96% will be allocated to the acquisition of
the General Partner's interest (the "GP Price"). The consideration described
above and the mutual covenants set forth below are acknowledged by all parties
to be adequate. At Closing, all of the income and expenses of the Partnership
and the Project will be prorated, and the Partnership will distribute all of
its undistributed net cash flow to the partners in accordance with the
provisions of the Partnership agreement (the "Closing Distributions"). The
current estimate of the Closing Distributions is shown on Exhibit G. Exhibit G
shall be updated as of the Closing.
2. Exchange. The Partnership will convey to Morris prior to Closing
and in complete redemption of Morris' entire interest in the Partnership (the
"LP Interest"), a 50% undivided interest in the Project (the "Morris Project
Interest"). Morris will execute and deliver an acknowledgment of redemption
in the form attached hereto as Exhibit A-1; and the Partnership will convey the
Morris Project Interest to Morris by execution and delivery of a standard form
grant deed. At the Closing, Cadence shall deposit with a "Starker" exchange
company, acceptable to Morris, the LP Price, in complete satisfaction of
Cadence's obligation with respect to the LP Price. Morris will enter into an
agreement with the "Starker" exchange company to consummate a tax deferred
exchange for the Morris Project Interest pursuant to Section 1031 of the
Internal Revenue Code (the "Exchange"). Cadence, the General Partner and the
Partnership agree to cooperate with Morris in connection with the Exchange'
provided that Morris will pay all expenses in connection with the Exchange and
will indemnify Cadence and the Partnership against any adverse tax consequences
or governmental claims resulting from the Exchange (including any and all
transfer taxes); and provided further that the Exchange will not delay the
Closing.
Notwithstanding any other provision of this agreement, Morris will
have the right exercisable by notice to Cadence and the Partnership at any
time prior to the Closing to sell the LP Interest to Cadence in lieu of
consummating the Exchange, in which event at the Closing (i) Morris will convey
the LP Interest to Cadence by execution and delivery of an assignment in the
form attached hereto as Exhibit A-2, (ii) Cadence will pay the LP Price to
Morris, and (iii) Paragraphs 3(a), 3(b) and 6(d)(3) shall be deemed modified
accordingly.
3. Closing. Subject to the provisions of Paragraph 10 below, the
Closing will take place on September 15, 1994 at such time and place as the
parties may agree; provided
<PAGE> 4
William Wilson & Associates
Morris Management Company
August 17, 1994
Page 3
that the date, time and place of the Closing may be changed by mutual
agreement of all parties, and provided further that if any of the conditions to
the Closing set forth in Paragraph 6 below are not satisfied by September 15,
1994, the party to be benefited by such unsatisfied conditions shall have the
right but not the obligation to extend the date of the Closing until a weekday
selected by such party that is no more than five days following the subsequent
satisfaction or waiver of such condition. Notwithstanding anything to the
contrary contained herein, Cadence may elect, by delivery of written notice to
the General Partner prior to September 15, 1994, to extend the Closing to a
date no later than October 15, 1994, if such extension, in the reasonable
judgment of Cadence, is required to complete its due diligence (including its
environmental review) or to obtain the consent or approval of Prudential to
this transaction.
At the Closing the following will occur:
(a) The General Partner will convey the General Partner's
entire interests in the Partnership (the "GP Interest") to Cadence (or its
affiliate) by execution and delivery of assignments in the forms attached
hereto as Exhibit A-3, and, consistent with its use of the Exchange, Morris
will cause the Morris Project Interest to be conveyed to Cadence by execution
and delivery of a standard form grant deed.
(b) Cadence will pay, by cashiers check or wire transfer as the
recipient may elect, (i) to the General Partner the GP Price, and (ii) to a
party other than Morris, as Morris may direct to effectuate the Exchange, the
LP Price.
(c) The parties will execute and deliver to each other mutual
releases in the form of Exhibit B.
(d) The General Partner will sign and deliver whatever
documents are required to remove it as a signatory from all bank accounts of
the Partnership.
(e) The General Partner will deliver all of the Partnership
books and records to Cadence, but the General Partner may retain copies of such
books and records.
(f) The General Partner will deliver its consent to all
assignments of limited partner interests in the form of Exhibit A-4.
(g) The General Partner will and Cadence (or its affiliate)
will indemnify each other and the Partnership with respect to certain claims
and liabilities pursuant to the indemnity form attached as Exhibit F.
<PAGE> 5
William Wilson & Associates
Morris Management Company
August 17, 1994
Page 4
4. Due Diligence. Cadence, the General Partner and Morris
acknowledge that they have access to all books, records and other information
relating to the Partnership and the Project necessary for them to make an
informed decision whether to purchase and sell the interests pursuant to this
agreement; all are sophisticated and capable of protecting their own
interests. Without limiting the generality of the foregoing and without
diminishing its reliance on the representations and warranties of the General
Partner and Morris set forth in Paragraph 5 below, Cadence acknowledges that
it is accepting the Project in an "as-is" condition, with all faults, and
Cadence hereby waives and releases all claims and causes of action (including
claims for contribution and indemnification) whether presently known or
unknown, against the General Partner, Morris, their partners, employees,
agents, officers, directors, successors and assigns with respect to the
physical condition of the Project. Cadence has investigated or will
investigate and has obtained or will obtain knowledge of all aspects of the
physical condition of the Project (including the existence or non-existence of
hazardous or toxic materials in, on or about the Project) and all operative or
proposed governmental laws and regulations to which the Project is or may be
subject. Cadence has reviewed the preliminary title report for the Project
attached hereto as Exhibit C-1 (the "Title Report") and the UCC search reports
for the Partnership and the General Partner attached hereto as Exhibit C-2 (the
"UCC Reports"). Cadence accepts the Project on the basis of its review of the
above matters.
It is the intention of the parties that the release contained in
this Section 4 shall be as broad and comprehensive as possible under law and in
furtherance of this intention, Cadence acknowledges having read and understood
Section 1542 of the Civil Code of the State of California which provides as
follows:
"A general release does not extend to claims which the creditor does
not know or suspect to exist in his favor at the time of executing the
release, which if known by him must have materially affected his
settlement with the debtor."
Cadence hereby expressly waives and relinquishes any and all rights
conferred under Section 1542, and all similar laws, to the full extent that
Cadence may lawfully do so; provided, however, that notwithstanding anything
set forth herein to the contrary, the foregoing release is not intended to, and
shall not, relieve the General Partner of Morris of any liability for or breach
of the representations, warranties or covenants set forth in this agreement,
the obligations under the indemnity agreement referred to in Paragraph 3(g) or
the mutual release referred to in Paragraph 3(c) or any failure to disclose to
Cadence the existence of any physical condition of the Project that is known to
Morris or the General
<PAGE> 6
William Wilson & Associates
Morris Management Company
August 17, 1994
Page 5
Partner and that is not susceptible to discovery by Cadence in the course of a
reasonable investigation of the physical condition of the Project.
5. Representations and Warranties. Each of the parties makes the
representations and warranties set forth for it below, hereby certifying that
such representations and warranties are true and complete as of the Closing,
and acknowledges that the other parties will rely upon such representations and
warranties in entering into and undertaking their respective obligations under
this agreement. Such representations and warranties will survive the Closing.
(a) The General Partner. The General Partner represents
and warrants that:
(1) It owns the GP Interests free and clear of all
forms of claims by third parties, including governmental agencies.
(2) It has the requisite authority, and the consent of
any third parties (including shareholders) whose consent is required to enter
into this agreement and to convey the GP Interest to Cadence under the terms of
this agreement .
(3) Neither the General Partner nor the Partnership is
a party to or otherwise bound by any agreements imposing a material obligation
on the Partnership other than the contracts identified in the List of Material
Contracts attached hereto as Exhibit D, complete copies of which contracts have
been delivered to Cadence for review, and the Partnership is not subject to
any material liabilities, obligations, pending claims or governmental actions
other than the Prudential loan, and matters disclosed in the Title Report, the
UCC Reports, the Schedule of Exceptions to Representations and Warranties
attached hereto as Exhibit E or the books, records or accounts of the
Partnership. As used in this paragraph, "material" means any obligation,
liability, claim or action exceeding $10,000.
(b) Morris. Morris represents and warrants that:
(1) It owns the Morris LP Interest and assuming the
Partnership conveys the Morris Project Interests to Morris pursuant to
Paragraph 2 above, it will own the Morris Project Interest, in each case free
and clear of all forms of claims by third parties, including governmental
agencies, other than, in the case of the Morris Project Interest, any liens,
claims or encumbrances affecting the Partnership's title to the Project at the
time the Morris Project Interest is conveyed to Morris pursuant to Paragraph 2
above and reflected in the Title Report or the UCC Reports.
<PAGE> 7
William Wilson & Associates
Morris Management Company
August 17, 1994
Page 6
(2) It has the requisite authority, and the
consent of any third parties whose consent is required (including general and
limited partners of Morris and their spouses) to enter into this agreement, to
convey the Morris LP Interest back to the Partnership in exchange for
conveyance from the Partnership of the Morris Project Interest, and to cause
the Morris Project Interest to be conveyed to Cadence under the terms of this
agreement.
(3) All requisite partnership action of Morris
necessary to authorize and implement this transaction has been duly taken.
(c) Cadence. Cadence represents and warrants that:
(1) It has the requisite authority and the consent
of any third parties whose consent is required to enter into this agreement and
to purchase the LP and GP Interest and the Morris Project Interest under the
terms of this agreement.
(2) All requisite action of the Cadence Board of
Directors necessary to authorize and implement this transaction has been duly
taken.
(3) It is an accredited investor within the meaning
of Regulation D under the Securities Act of 1933; and it is acquiring the L.P.
Interest and the G.P. Interest for its own account, for investment, without a
view to distribution of the same.
(d) Partnership. Partnership represents and warrants
that:
(1) It has the requisite authority, and the consent
of any third parties whose consent is required, to enter into this agreement
and to convey the Morris Project Interest to Morris in exchange for redemption
of the L.P. Interest under the terms of this agreement.
(2) All requisite action of the Partnership
necessary to authorize and implement this transaction has been duly taken.
6. Conditions.
(a) Mutual. The respective obligations of the parties
hereto are mutually conditioned on the occurrence (or each party's waiver of
the occurrence) of simultaneous delivery of all items to be delivered at the
Closing pursuant to Paragraph 3 above, including without limitation, the
payment of the Closing Distributions to the General Partner, Morris and Cadence.
<PAGE> 8
William Wilson & Associates
Morris Management Company
August 17, 1994
Page 7
(b) The General Partner. The General Partner's
obligations under this agreement are further conditioned on the truth and
completeness (or waiver of the truth and completeness) of all
representations and warranties of Morris, Cadence and the Partnership under
this agreement, and the receipt by the General Partner at the Closing of
the GP Price.
(c) Morris. Morris' obligations under this agreement are
further conditioned on the satisfaction (or waiver of the satisfaction) of
each of the following:
(1) All representations and warranties of the
General Partner, Cadence and the Partnership under this agreement shall be
true and complete.
(2) The Partnership shall have conveyed the Morris
Project Interest to Morris in redemption of the L.P. Interest.
(3) Morris or its designee for purpose of the
Exchange shall receive the LP Price at Closing.
(d) Cadence. Cadence's obligations under this agreement
are further conditioned on the satisfaction (or waiver of the satisfaction)
of each of the following:
(1) All representations and warranties of the General
Partner, Morris and the Partnership under this agreement shall be true and
complete.
(2) All covenants of the General Partner to be
performed prior to the Closing shall have been performed.
(3) Cadence shall receive at the Closing (i) all of
the LP Interest, (ii) all of the GP Interest, and (iii) all of the Morris
Project Interest.
(4) Prudential shall have consented to the
consummation of the transactions contemplated hereby on terms acceptable to
Cadence.
(5) Cadence is satisfied with the results of its
environmental survey, which shall be completed (and this condition shall be
removed) not later than September 15, 1994; provided, however, if Cadence
determines in its reasonable judgment that the environmental survey will
not be completed by September 15, 1994, Cadence may elect to extend the
removal date of this condition to a date not later than October 15, 1994 by
delivering written notice of such election to the General Partner prior to
September 15, 1994.
<PAGE> 9
William Wilson & Associates
Morris Management Company
August 17, 1994
Page 8
In the event Cadence does not receive the results of its environmental
survey prior to October 15, 1994 and the transaction has not already closed
or this Agreement has not otherwise been terminated, the condition set
forth in this subparagraph (5) will be deemed waived.
(6) There shall have been no material adverse change
in the financial condition of the Partnership or Project.
(e) Partnership. The Partnership's obligations under
this agreement are further conditioned on the truth and completeness (or
the Partnership's waiver of the truth and completeness) of all
representations and warranties of the General Partner, Morris and Cadence
under this agreement.
7. Operations Through Closing. The General Partner represents
and covenants that through the Closing it will continue to conduct the
business of the Partnership in the ordinary course. Upon the Closing, the
management agreement between the Partnership and the General Partner (and
any subcontractor) will terminate and the management fees which have
accrued to that date will be paid by the Partnership at the Closing,
provided, however, that any management or consulting fees of the
Partnership arising as a direct result of this transaction shall be paid by
the General Partner and Morris. Such costs shall be paid 98.04% by Morris
and 1.96% by the General Partner.
8. Confidentiality. All parties, unless under compulsory process
or obligation to disclose in connection the provisions of the Securities
and Exchange Act of 1934, will maintain the confidentiality of the
provisions of this agreement, and no party will issue a press release in
connection with this proposed transaction without the prior consent of all
other parties. This covenant will not limit a party's ability to share
relevant information with its professional advisors, such as attorneys and
accountants, and with Prudential, however. Moreover, and notwithstanding
any contrary provision of this agreement, this covenant will survive any
termination of this agreement.
9. General Partner Consultation. Following the Closing, the
General Partner will provide, at no charge, up to five (5) days of
consultation with Cadence's project manager to assist an orderly transition
of the management of the Partnership and the Project.
10. Termination. This agreement may be terminated (i) by the
mutual agreement of all parties or (ii) if any of the conditions to the
Closing set forth in Paragraph 6 above are not satisfied and not waived in
accordance herewith, by any party to be benefited by such unsatisfied and
unwaived condition, in which case the termination shall occur upon notice
by such party to all other parties. This agreement will automatically
terminate at 5:00 p.m. on
<PAGE> 10
William Wilson & Associates
Morris Management Company
August 17, 1994
Page 9
October 31, 1994, unless the Closing occurs prior thereto. Upon
termination of this agreement, all parties will be relieved of all further
obligations hereunder; provided that any party whose breach of this
agreement resulted in such termination shall not be relieved of any
liability resulting therefrom.
11. Miscellaneous. This agreement constitutes the entire
agreement between the parties on the subject matter hereof and may be
amended only by a written amendment signed by all parties. All references
to the agreement will include the provisions of the exhibits attached to
this agreement. This agreement will be governed by California law as
applied to contracts entered into between residents of California. The
parties acknowledge that specific performance is an appropriate remedy for
any breach of this agreement. All parties will bear their own legal
expenses in connection with the preparation of this agreement and any
modifications and the effectuation of the transactions contemplated and no
such costs or expenses shall be borne by or allocated to the Partnership.
This agreement may be signed in counterparts, all of which together shall
constitute a single agreement. The invalidity of any portion of this
agreement will not invalidate any other portion; provided that in no event
will Cadence be obligated to acquire less than all ownership interests in
the Project and Partnership. No waivers permitted by this agreement shall
be implied by conduct. Time is of the essence in this agreement. The
provisions of this agreement may not be introduced into evidence by any
party hereto in any matter of dispute between them, except in connection
with a claim of breach of this agreement. In the event of any
inconsistency between the provisions of this agreement and the provisions
of the Partnership agreement, then the provisions of this agreement will
supersede such other provisions. Finally, the parties agree to execute
such other documents as may be necessary in the future without additional
risk or expense in order to implement the provisions of this agreement.
If the offer set forth above is acceptable, please so indicate by
executing the enclosed copy of this letter where indicated below and
returning it to me. Upon receipt of copies of this letter signed by all
parties by 5:00 p.m. on September 15, 1994, this letter will constitute a
binding agreement among all parties; otherwise, this offer will lapse.
<PAGE> 11
William WIlson & Associates
Morris Management Company
August 17, 1994
Page 10
Thank you for your thoughtful consideration of this matter.
Sincerely,
CADENCE DESIGN SYSTEMS, INC.
By: /s/ H. RAYMOND BINGHAM
----------------------------
H. Raymond Bingham,
Executive Vice President and
Chief Financial Officer
ACCEPTED:
MORRIS ASSOCIATES VI, L.P.
By: Morris Management Company
its General Partner
By:
---------------------------
Diane M. Downend
Vice President
Date:
------------------------------
MORRIS MANAGEMENT COMPANY
(for itself and for the Partnership
as General Partner)
By:
--------------------------------
Diane M. Downend
Vice President
Date:
------------------------------
<PAGE> 12
Exhibit A-2
Assignment of LP Interest
For value received, Morris Associates VI, L.P., hereby assigns,
conveys and transfers to Cadence Design Systems, Inc. all of its right, title
and interest as a limited partner of River Oaks Place Associates, L.P., a
California limited partnership.
Dated: 10-25-94
---------------------------------
Morris Associates VI, L.P.
By: MORRIS MANAGEMENT COMPANY
------------------------------------
general partner
By: /s/ DIANE M. DOWNEND
------------------------------
vice president
<PAGE> 13
Exhibit A-3
Assignment of GP Interest
For value received, Morris Management Company, Inc., a California
corporation, hereby assigns, conveys and transfers to Seeley Properties, Inc.
all of its right, title and interest in the general partner interest in River
Oaks Place Associates, L.P., a California limited partnership.
Dated: 10-25-94
---------------------------------
Morris Management Company
By: /s/ DIANE M. DOWNEND
-----------------------------------
vice president
<PAGE> 14
Exhibit A-4
General Partner Consent
Morris Management Company, Inc. as general partner of River Oaks
Place Associates , L.P., hereby consents to the assignment of Morris Associates
VI., L.P.'s limited partner interest in River Oaks Place Associates, L.P., as
set forth in a letter agreement dated August 17, 1994 among Cadence Design
Systems, Inc., and others, effective as of the closing of such agreement.
Dated: 10-25-94
---------------------------------
Morris Management Company
By: /s/ DIANE M. DOWNEND
-----------------------------------
vice president
<PAGE> 15
Exhibit A-5
Limited Partner Consent
Cadence Design Systems, Inc. and Morris Associates VI., L.P. as
limited partners of River Oaks Place Associates , L.P., hereby consent to the
assignment of Morris Management Company, Inc.'s general partner interest in
River Oaks Place Associates, L.P., as set forth in a letter agreement dated
August 17, 1994 among Cadence Design Systems, Inc., and others, effective as of
the closing of such agreement.
Dated: 10-25-94
---------------------------------
Morris Associates VI, L.P.
By: Morris Management Company
-----------------------------------
general partner
By: /s/ Diane M. Downend
---------------------------
vice president
Cadence Design Systems, Inc.
/s/ H. RAYMOND BINGHAM
- - --------------------------------------
by: H. Raymond Bingham
Executive Vice President and
Chief Financial Officer
<PAGE> 16
Exhibit B
MUTUAL GENERAL RELEASE
Introduction. This release is entered into in connection with
a letter agreement dated August 17, 1994 among Cadence Design Systems, Inc.,
Morris Management Company, Inc. and Morris Associates VI, L.P. (the "Letter
Agreement"). The parties and terms referred to below are defined in the Letter
Agreement. Therefore:
Release. Except with respect to obligations created by the
Letter Agreement and as set forth below, each of Cadence, the General Partner,
Morris and the Partnership for itself and its respective successors,
predecessors, assigns, agents, officers, employees, heirs and personal
representatives, hereby release and absolutely and forever discharge the other
parties to this release and their respective attorneys, successors, assigns,
officers, employees, shareholders, agents, heirs, and personal representatives,
of and from all claims, demands, damages, debts, liabilities, accounts,
obligations, costs, expenses, liens, actions, and causes of action of every
kind and nature whatsoever, including attorneys' and experts' fees, whether
now known or unknown, suspected or unsuspected, which any party now has, owns,
or holds or at anytime heretofore ever had, owned, or held, or could, shall, or
may hereafter have, own, or hold, against any other based on or arising out of
any matter, cause, fact, transaction, act, or omission whatsoever occurring or
existing at any time prior to and including the effective date hereof, bearing
any logical or factual connection whatsoever to the limited partnership
agreement for River Oaks Place Associates, L.P., and any related agreements
(collectively the "Released Agreements"), any party's performance,
nonperformance or breach of the Released Agreements, and any liabilities
arising or alleged to have arisen under or in the course of performance under
the Released Agreements or in connection with the development and management of
the real property referred to in the Released Agreements (all of which are
hereinafter referred to as and included within the "Released Matters").
Covenant Not To Sue or Offset Each party agrees that it will
not bring, commence, institute, maintain, prosecute or voluntarily aid any
action at law, proceeding in equity, or otherwise prosecute or sue any other
party hereto or its agents, representatives, heirs, partners, directors,
officers, employees, servants, affiliates, subsidiaries, stockholders,
predecessors, successors and assigns, or any person acting for, through, under
or in concert with any of the foregoing, either affirmatively or by way of
cross-complaint, defense, equitable offset or counter-claim or by any other way
or manner at all, in any court, on any alleged claims, demands, liabilities,
causes of action, suits, debts, liens, contracts, agreements, promises, losses,
damages, costs or expenses, of any nature whatsoever, known or unknown, fixed
or contingent, arising out of the Released Matters.
General Release. Each party acknowledges that it is familiar
with Section 1542 of the Civil Code of the State of California, which provides
as follows:
"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR
DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF
EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY
AFFECTED HIS SETTLEMENT WITH THE DEBTOR."
EACH PARTY WAIVES AND RELINQUISHES ANY RIGHT OR BENEFIT WHICH IT HAS OR MAY
HAVE UNDER SECTION 1542 OF THE CIVIL CODE OF THE STATE OF CALIFORNIA RELATING
TO THE RELEASED MATTERS. In connection with such waiver and relinquishment,
each party acknowledges that it is aware that it or its attorneys or agents may
hereafter discover claims or facts in addition to or different from those which
they now know or believe to exist with respect to the subject matter of the
Released Matters or any other party hereto, but that it is each party's
intention hereby fully, finally, and forever to settle and release all Released
Matters, disputes and differences, known or unknown, suspected or unsuspected,
which now exist, may exist or heretofore, may have existed between the parties
relating to the Released Matters, except as otherwise expressly provided
herein. In furtherance of this intention, the mutual releases herein given
shall be and remain in effect as a full and complete general release
notwithstanding the discovery or existence of any such additional or different
claim or fact.
Authorized Release. Each party warrants and represents that
it is the sole and lawful owner of all rights, title and interest in and to all
the Released Matters, that it has the right and the authority to execute this
Agreement and that it has not heretofore voluntarily, by operation of law, or
otherwise, assigned or transferred or purported to assign or transfer to any
person whatsoever any Released Matters or any part or portion thereof or any
claim, demand or right against any other party hereto.
Indemnity for Undisclosed Assignment of Claims. Each party
shall indemnify and hold the others harmless from and against any claim,
demand, damage, debt, liability, account, obligation, cost, expense, lien,
action, or cause of action (including payment of reasonable attorneys' and
experts' fees and costs actually incurred whether or not litigation is
commenced) based on or in connection with or arising out of any assignment or
transfer
<PAGE> 17
or purported or claimed assignment or transfer by such party of the type
referred to in the preceding paragraph (all of which are hereinafter referred
to as the "Claim"). Each party's right to indemnification under this paragraph
is subject to it promptly giving the indemnifying party notice of any Claim,
including in such notice a brief description of the facts upon which the Claim
is based and the amount thereof.
No Admissions. Nothing contained herein shall be construed as
an admission by any party of any liability of any kind to any other party. Each
party expressly denies that it is in any way liable or indebted to any other
party hereto, except with respect to obligations created or expressly renewed
by this Agreement and the Letter Agreement.
Informed Consent to Release. Each party acknowledges to each
other party that it has been represented by legal counsel of its own choice
throughout all of the negotiations which preceded the execution of this
Agreement, and that each party has had ample opportunity to have this Agreement
and the releases contained herein reviewed by its respective legal counsel.
Each party further acknowledges that it and its counsel has had adequate
opportunity to make whatever investigation or inquiry deemed necessary or
desirable in connection with this Agreement and the Released Matters prior to
the execution hereof.
Limited Third Party Beneficiaries. In addition to the named
parties, the provisions of this Agreement shall extend to and inure to the
benefit of and be binding upon the respective successors, assigns,
representatives, predecessors, agents, officers, employees, shareholders,
directors, heirs and attorneys of each of the parties, just as if they had
executed this Agreement. There are no other intended third party
beneficiaries of this Agreement.
Excluded Matters. Notwithstanding the foregoing, Cadence and
Seeley Properties, Inc. (the new general partner) affirm their prospective
obligations under the River Oaks Place Associates, L.P., limited partnership
agreement which agreement survives this release, and Cadence and the
Partnership affirm their prospective obligations under the three leases dated
as of June 29, 1989, which leases survive this release. Moreover, the loan
agreement dated February 28, 1990 with Prudential Life Insurance Co. and
related documents, and all obligations created thereunder, and the indemnity
obligations of Seeley Properties, Inc. and the General Partner under the
Idemnity of even date herewith shall survive this release.
Effective Date. This Agreement will take effect upon the
Closing.
In witness whereof the parties subscribe their names:
CADENCE DESIGN SYSTEMS, INC. Seeley Properties, Inc.
By: /s/ H. RAYMOND BINGHAM (for "Excluded Matters" provisions only)
---------------------------
H. Raymond Bingham By: /s/ H. RAYMOND BINGHAM
Executive Vice President and ----------------------------------
Financial Officer H. Raymond Bingham, president
Morris Associates VI, L.P.
By: Morris Management Company
---------------------------
general partner
By: /s/ DIANE M. DOWNEND
---------------------
vice president
Morris Management Company
By: /s/ DIANE M. DOWNEND
-------------------------
vice president
River Oaks Place Associates, L.P.
By:
--------------------------
Morris Management Company, Inc., general partner
By: /s/ DIANE M. DOWNEND
----------------------
vice president
<PAGE> 18
Exhibit F
Indemnity
In connection with a letter agreement dated August 17, 1994 among
Cadence Design Systems, Inc ("Cadence"), Morris Management Company and Morris
Associates VI, L.P. ("Morris"), Seeley Properties, Inc. ("Seeley") will replace
Morris Managment Company as the general partner of River Oaks Place Associates,
L.P.. As a condition to closing the transactions contemplated in the letter
agreement, Seeley, on the one hand, and Morris Managment Company, on the other
hand, have agreed to indemnify each other from certain third party claims .
Now, therefore, for valuable consideration:
1. Seeley agrees to indemnify Morris Managment Company from all claims or
losses, including reasonable attorneys' fees, related to the River Oaks Place
Associates, L.P.,. limited partnership and the ownership and operation of the
real estate referred to in its partnership agreement, which arise as a result
of an obligation to a party other than Morris Management Company, Morris or the
Partnership and which accrue after the closing of the transactions referred to
in the letter agreement.
2. Morris Management Company agrees to indemnify Seeley from all claims or
losses, including reasonable attorneys' fees, related to the River Oaks Place
Associates, L.P., limited partnership and the ownership and operation of the
real estate referred to in its partnership agreement, which arise as a result
of an obligation to a party other than Seeley, Cadence, Morris or the
Partnership and which accrue on or before the closing of the transactions
referred to in the letter agreement.
Notwithstanding the above, the parties agree and acknowledge that Morris
Management Company shall incur no liability under this indemnity for a claim by
a third party in excess of the amount which Morris Management Company would
have incurred due to such claim as general partner of the Partnership under the
Agreement of Limited Partnership of River Oaks Place Associates, L.P. dated
June 29, 1989, assuming each other party thereto fully satisfied its
obligations thereunder, including, without limitation, obligations to make
additional capital contributions.
Dated: 10-25-94
---------------------------------
Morris Management Company
By: /s/ DIANE M. DOWNEND
-----------------------------------
vice president
Seeley Properties, Inc.
By: /s/ H. RAYMOND BINGHAM
-----------------------------------
H. Raymond Bingham
president
<PAGE> 19
[LETTERHEAD]
CADENCE DESIGN SYSTEMS, INC.
555 River Oaks Parkway
San Jose, CA 95134
408-943-1234
408-943-0513 Fax
Mr. James Arce October 18, 1994
William Wilson & Associates
2929 Campus Drive #450
San Mateo, CA 94403 By fax (415) 345-7619
Re: Setting the closing date and final conditions
Dear Jim:
I am following up on yesterday's conversation, during which we agreed
to extend the "early closing" proration benefit referred to in Exhibit G of our
letter agreement dated August 17, 1994 through October 31, 1994 as
consideration for the early option exercise discussed below. With your
client's signature, Exhibit G will be amended accordingly.
There are a few other developments. Since going into contract,
Cadence has completed its physical inspection and environmental review.
Cadence deems these contingencies satisfied.
Prudential's consent was sought and has been provisionally tendered on
the condition that Cadence exercise its first option to extend the leases by
five years. Contingent on the closing, Cadence will exercise such option,
provided that Prudential delivers its consent in writing prior to closing with
no other substantive conditions. Therefore, at closing, Cadence has the
additional delivery of the exercise notice, which will be in form and substance
acceptable to Prudential.
In connection with obtaining Prudential's consent, the Partnership
will reimburse Prudential's reasonable attorneys' fees which will be less than
$10,000. The final closing prorations of Exhibit G will reflect this
adjustment, of course.
Lastly, you have advised me that your clients have elected to forego
the like-kind exchange provisions of the letter agreement. This has simplified
Prudential's review and will simplify the closing, which date we agree to set as
Wednesday, October 26 at 11 AM at Cadence's offices. I suggest that we
"preclose" the transaction on Tuesday afternoon. If delays are encountered,
each side will use its best efforts to close on succeeding business days
through October 31, 1994, subject to the provisions of the letter agreement.
If the foregoing is acceptable, please have your clients sign and
return a copy of this letter.
Best regards, /s/ DIANE M. DOWNEND
--------------------------------------------
Morris Associates, VI L.P.,
Morris Management Company,
Diane M. Downend
Vice President
Jim Given, counsel /s/ DIANE M. DOWNEND
--------------------------------------------
Morris Management Company, Diane M. Downend
Vice President
cc: The Prudential Realty Group /s/ H. RAYMOND BINGHAM
--------------------------------------------
Cadence Design Systems, Inc.
By: H. Raymond Bingham,
Executive Vice President
& Chief Financial Officer
