ASSIGNMENT AND ASSUMPTION AGREEMENT
Exhibit 10.4
ASSIGNMENT AND ASSUMPTION AGREEMENT
This Assignment and Assumption Agreement (the “Agreement”) is made as of October 22, 2012 (the “Effective Date”), by and between Real Estate Associates Limited IV, a California limited partnership (“Assignor”); Terrace House, LLC a Connecticut limited liability company (“Terrace House”); W. Xxxxxxx Xxxx as executor for the Estate of Xxxxxxx X. Xxxx (the “Estate”); W. Xxxxxxx Xxxx, an individual (“Harp”); and Xxxx X. Xxxxx, an individual (“Xxxxx”), each a “Party“ and, as the context requires, any two or more, collectively, “Parties”), with reference to the following:
X. Xxxxx is the surviving sole operating general partner of the Partnership and Assignor is the limited partner of the Partnership.
C. Xxxxxxx X. Xxxx, who is now deceased, was a co-operating general partner of the Partnership, and upon his death, his general partnership interest was converted to a special limited partner interest.
D. Assignor has agreed to assign all of its limited partnership interest in the Partnership to Terrace House and to the “Operating General Partner,” as defined herein, and withdraw from the Partnership, Terrace House has agreed to acquire such limited partnership interest of Assignor and the Operating General Partner has consented to such assignment and assumption, all pursuant to the terms of this Agreement.
E. The Parties hereto have agreed to admit Harp as a co-operating general partner in exchange for consideration set forth herein.
X. Xxxx and Xxxxx shall collectively be referred to as the “Operating General Partner”.
1.1 Effective as of the “Closing” (as hereinafter defined):
(a) Assignor hereby assigns to Terrace House 2% of Assignor’s interest in the Partnership, 49% of Assignor’s interest in the Partnership to Xxxx X. Xxxxx and 49% of the Assignor’s interest in the Partnership to W. Xxxxxxx Xxxx, as the executor of the estate of Xxxxxxx X. Xxxx, including, without limitation, all Profits and Losses, Cash From Operations, Net Refinancing Cash, Cash from Disposition or Partial Disposition and other Partnership distributions, other Partnership funds and assets, and any reimbursements of expenses, repayments of any loans made by the Withdrawing Limited Partner or any Affiliate to the Partnership (collectively, the “Interest”), and
(b) Terrace House and the Operating General Partner, jointly and severally, assume and agree to perform all of the obligations of Assignor under the Partnership Agreement.
1.2 In consideration of Assignor’s assignment of the Interest, at the Closing Terrace House shall pay to Assignor an amount (the “Payment”) equal to $1,530,000.00 payable in cash and Harp shall pay to Assignor $1.00. Assignor covenants and agrees that such sums shall be received in full satisfaction of all obligations and liabilities due Assignor in connection with or in any manner arising out of the Partnership, the Project or any other assets owned by the Partnership.
(a) As provided in Section 1.2, Terrace House shall pay the Payment; and
(b) Assignor, Terrace House, and the Operating General Partner shall execute and exchange countersigned counterparts of the First Amendment to Amended and Restated Agreement of Limited Partnership of the Partnership in the form attached hereto as Exhibit A (the “Amendment”).
3.1 Each of the Parties acknowledges that the consents of the Governmental Agencies to the transfer of the Interest, as contemplated by this Agreement is required. Terrace House and the Operating General Partner shall use commercially reasonable efforts to obtain the same, and Assignor, at no cost, expense or liability to it, will cooperate to provide the Authority with such information and executed documents which the Authority may reasonably require in order to evaluate such transfer and it shall be a condition precedent to Closing that the Authority’s consent is received prior to Closing. Terrace House, on the one hand, and Assignor, on the other, shall each provide the other with copies of any correspondence from the Authority that it receives in connection with their review of the proposed transfer of the Interest.
3.2 It shall be a condition precedent to Closing that all representations, warranties set forth herein shall be true and correct in all material respects, and all covenants set forth herein shall have been fully complied with in all material respects as of the Closing.
3.3 Notwithstanding anything to the contrary contained or implied in this Agreement, there are no other conditions to the obligation of the Parties to close the transaction contemplated by this Agreement except as expressly set forth in this Section 3.
3.4 If on or before Closing any condition set forth in Section 3.1 or 3.2 has not been satisfied, this Agreement shall terminate and be of no further force or effect.
4. Representations, Warranties and Covenants.
(d) Terrace House and the Operating General Partner is each aware of the restrictions on transfer or encumbrance of the Interest under the Partnership Agreement, as well as the transfer restrictions imposed by the Securities Act of 1933, as amended, and applicable state securities laws (the “Securities Laws”). Terrace House and the Operating General Partner is each able to bear the economic risk of its respective investment in the Interest, is aware that it must hold the Interest for an indefinite period and that the Interest has not been registered under the applicable Securities Laws and may not be sold or otherwise transferred unless permitted by the terms of the Partnership Agreement and the Interest is registered, or an exemption from the registration requirements is available with respect thereto, under the Securities Laws. Each of Terrace House and the Operating General Partner is acquiring its portion of the Interest for its own account and not with a view to resell, transfer or otherwise dispose thereof.
(e) Terrace House is an affiliate of the Operating General Partner and, knows, therefore, at least as much about the Partnership as Assignor. Terrace House is experienced in financial transactions such as ownership of the Interest and understands the business and operations of the Partnership. Terrace House has had an opportunity to ask questions about and seek information about the Partnership and the Project, and has not relied upon any express or implied representations or warranties from Assignor with regard to the Interest, the Partnership or the Project, except as expressly provided herein.
Aimco
00 Xxxxxxxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxxx XX 00000
Attention: Xxxx Xxxxxx
Aimco
0000 Xxxxx Xxxxxx Xxxxxx Xxxxxxx
Xxxxx 0000
Xxxxxx, XX 00000
Attention: Xxx Xxxxxxx, Esq.
Facsimile: 000-000-0000
with a copy to:
Law Offices of Xxxxx X. Xxxxxx, Inc.
000 X. Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxx
Facsimile: 000-000-0000
(b) If to Terrace House or the Operating General Partner, to the intended recipient at:
W. Xxxxxxx Xxxx
000 Xxxxxx Xxxxxx
Xxx Xxxxx, Xxxxxxxxxxx
Facsimile:
and:
Xxxx Xxxxx
000 Xxxxxxxxx Xxxxx
Xxxxxx, Xxxxxxx 00000
Facsimile:
with a copy to:
Xxxxxx, Xxxxx & Xxxxxxxx, PC
Xxxxx X. Xxxxxxx, Esq.
00 Xxx Xxxxxx, Xxxxx Xxxxx
Xxx Xxxxx, Xxxxxxxxxxx 00000
Facsimile 203-562-8430
Any of the Parties may designate a change of address by Notice in writing to the other Parties. Whenever in this Agreement the giving of Notice by mail or otherwise is required, the giving of such Notice may be waived in writing by the person or persons entitled to receive such Notice.
5.3 This Agreement may be signed in any number of counterparts, each of which shall be an original for all purposes, but all of which taken together shall constitute only one agreement. The production of any executed counterpart of this Agreement shall be sufficient for all purposes without producing or accounting for any other counterpart thereof.
5.4 This Agreement shall be binding upon and inure to the benefit of the heirs, executors, administrators, legal representatives and permitted successors and assigns of the Parties hereto. This Agreement shall be interpreted in accordance with the laws of the state in which the Project is located.
[Signatures on following page(s)]
IN WITNESS WHEREOF, the Parties have entered into this Agreement as of the date set forth above.
ASSIGNOR: REAL ESTATE ASSOCIATES LIMITED IV,
a California limited partnership
By National Partnership Investments, LLC,
a California limited liability company,
its general partner
By Bethesda Holdings I, LLC,
a Delaware limited liability company,
its member
By AIMCO/Bethesda Holdings, Inc.,
a Delaware corporation,
its member
By /s/Xxxx Xxxxxxx
Name: Xxxx Xxxxxxx
Title: Executive Vice President
ASSIGNEE: TERRACE HOUSE, LLC,
a Connecticut limited liability company
By /s/Xxxx X. Xxxxx
Name: Xxxx X. Xxxxx
Title: Partner
OPERATING GENERAL PARTNER: /s/W. Xxxxxxx Xxxx
W. XXXXXXX XXXX, as executor for the Estate of Xxxxxxx X. Xxxx
/s/Xxxx X. Xxxxx
XXXX X. XXXXX