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EXHIBIT 10.6
Purchase Agreement for Hawthorne Village
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EXHIBIT 10.6
AGREEMENT OF PURCHASE AND SALE
by and between
LASALLE NATIONAL TRUST, N.A.,
Successor to LaSalle National Bank, as Trustee under Trust Agreement
Dated May 31, 1983
and known as Trust Number 106520
and
ENDOWMENT AND FOUNDATION REALTY
PARTNERSHIP -- JMB-I,
an Illinois limited partnership,
(Collectively Referred to herein as "Seller")
AND
INLAND MONTHLY INCOME FUND III, INC.
a Maryland corporation,
Purchaser
DATED: July 18, 1996
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AGREEMENT OF PURCHASE AND SALE
(HAWTHORN XXXXXXX XXXXXXX, XXXXXX XXXXX, XXXXXXXX)
THIS AGREEMENT OF PURCHASE AND SALE is made and entered into as of the
18th day of July, 1996 by and between LASALLE NATIONAL TRUST, N.A., successor
to LaSalle National Bank, as trustee under a trust agreement dated May 31, 1983
and known as Trust Number 106520 (the "Trust") and ENDOWMENT AND FOUNDATION
REALTY PARTNERSHIP -- JMB-I, an Illinois limited partnership ("Beneficiary")
(collectively referred to herein as "Sellers"), having an address of c/x Xxxxxxx
Capital Management Corporation, 000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx,
Xxxxxxxx 00000-0000, Attention: Xxxxxx X. Xxxxxxx, and INLAND MONTHLY INCOME
FUND III, INC., a Maryland corporation ("Purchaser"), having an address of 0000
Xxxxxxxxxxx Xxxx, Xxx Xxxxx, Xxxxxxxx, 00000, Attention: Xxxxxx X. Xxxxx.
RECITALS
The Trust is the owner of a parcel of real estate in Vernon Hills,
Illinois, legally described on Exhibit A attached hereto and all buildings
thereon (the "Real Property", which together with any and all improvements and
appurtenances thereto is collectively referred to as the "Property"), commonly
known as the Hawthorn Village Commons located at 000-000 Xxxxxxxx Xxxx xx
Xxxxxx Xxxxx, Xxxxxxxx. The Property consists of a shopping center containing
approximately 98,686 square feet situated on an underlying parcel of
approximately 11.09 acres.
Subject to and on the terms and provisions of and for the
considerations set forth in this Agreement, Seller has agreed to sell, and
Purchaser has agreed to buy, the Property.
NOW, THEREFORE, the parties hereto hereby agree as follows:
1. Definitions. As used in this Agreement, the following terms have the
following meanings:
Closing Date. As agreed between Seller and Purchaser but no later
than August 15, 1996.
Due Diligence Period. The period beginning on the date of this
Agreement and ending on July 31, 1996.
Title Company. Near North National Title Corporation, as agent for
First American Title Insurance Company.
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2. Sale; Purchase Price.
2.1 Subject to the terms and provisions hereof, Seller agrees to
sell and convey to Purchaser, and Purchaser agrees to Purchase from Seller the
Property.
2.2 The total purchase price (hereinafter called the "Purchase
Price") to be paid by Purchaser to Seller for the Property shall be Eight
Million Five Hundred Thirty Thousand and no/100 Dollars ($8,530,000.00). The
Purchase Price shall be payable in the following manner:
(a) XXXXXXX MONEY. Purchaser shall, simultaneously with
delivery of this Agreement to Seller, deposit with the Title Company, as escrow
agent, the amount of One Hundred Thousand and 00/100 Dollars ($100,000.00)
(hereinafter called the "Xxxxxxx Money") which Xxxxxxx Money shall be in the
form of a wire transfer of immediately available United States of America
funds. The Xxxxxxx Money shall be held and disbursed by the Title Company
acting as escrow agent pursuant to the Xxxxxxx Money Escrow Agreement in the
form of Exhibit H attached hereto which the parties have executed
simultaneously with this Agreement. The Xxxxxxx Money shall be invested in a
federally insured interest bearing account with any interest accruing thereon
being deemed part of the Xxxxxxx Money and shall be paid to the party to which
the Xxxxxxx Money is paid pursuant to the provisions hereof. If the sale
hereunder is consummated in accordance with the terms hereof, the Xxxxxxx Money
and any interest thereon shall be applied to the Purchase Price to be paid by
Purchaser at the Closing. In the event of a default hereunder by Purchaser or
Seller, the Xxxxxxx Money shall be applied as provided herein.
(b) CASH BALANCE. Purchaser shall pay the balance of the
Purchase Price, subject to the prorations described in Paragraph 5 below, in
cash (the "Cash Balance") by wire transfer of immediately available United
States of America funds to the Title Company for payment to Seller, in
accordance with the terms and conditions of this Agreement. Such wire transfer
shall be initiated and confirmation thereof by communication of a reference
number shall be made no later than 10:00 a.m. (Central Standard time) on the
Closing Date.
3. Seller's Deliveries; Conditions Precedent.
3.1 Seller's Deliveries. Except for any Excluded Documents (as
hereinafter defined), Seller has provided to Purchaser and Purchaser
acknowledges receipt of one copy of the following items relating to the
ownership and operation of the Real Property:
(a) all leases and all modifications and amendments
thereto (the "Leases") as listed on Schedule 1 attached hereto;
(b) all service contracts (the "Service Contracts") as
identified in Schedule 2 attached hereto;
(c) operating statements for the Property for the two
prior calendar years and monthly operating statements for the current year;
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(d) copies of the real estate tax bills for the current
year and two prior years and current assessment notices, if available;
(e) the following environmental reports:
(i) Report of Phase I Environmental Site
Assessment and Limited Asbestos Survey dated
September 16, 1993 (Law Engineering Project
No. 274-3182-000).
(ii) Report of Phase II Site Assessment dated
September 16, 1993 (Law Engineering Project
No. 279-3197).
(iii) Phase II Environmental Assessment Report dated
November 17, 1993 prepared by H&GCL (Project
No. 45052.01).
(iv) Remedial Action Plan dated January 17, 1994
prepared by H&GCL (Project No. 450S2.01).
(v) Remedial Action Report dated August 4, 1994
prepared by Hygienetics Environmental
Services, Inc. (Project No. 45052.02).
(f) plans and specifications and certificates of
occupancy, in Seller's actual possession;
(g) commitment for title insurance dated 4/17/96 and
survey dated 7/12/96; and
(h) list of all tangible personal property owned by
Seller and used in connection with the Property or the operation thereof.
Except for Excluded Documents, Seller shall provide to Purchaser any
documents described above and first coming into Seller's possession or produced
by Seller after the initial delivery of the above and continue to provide the
same during the pendency of this Agreement. In the event this Agreement
terminates for any reason, Purchaser shall immediately return to Seller all
written and other physical materials (whether from Seller, Seller's agents or
otherwise) received by Purchaser relating to the Property or Seller.
Seller represents that all of the items delivered to Purchaser and
identified in subsections (a), (b), (d) and (e) above are complete copies of
the originals of such items. With regard to the operating statements
identified in subsection (c) above, said statements are complete copies of the
original operating statements, and they are the only operating statements
prepared for and in the possession of Seller relating to the Property. Seller
and Purchaser mutually acknowledge that Purchaser will be making its own
independent inquiry regarding the economic feasibility, physical condition and
environmental state of the Property during the Due Diligence Period, which
inquiry will be based in part on the truth and accuracy of the foregoing
representations. The foregoing provisions of this paragraph shall be subject
to the limitations in the last three grammatical paragraphs of Section 6 of
this Agreement and in Section 7 of this Agreement below.
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3.2 Inspections and Access. Purchaser and its representatives
shall be permitted to enter upon the Property at any reasonable time and from
time to time during the Due Diligence Period to examine, inspect and
investigate the Property (collectively, the "Inspections") and all books,
records, drawings, and other documentation relating thereto in Seller's
possession, subject to the terms, conditions and limitations set forth in the
following paragraphs.
(a) Purchaser shall have a right to enter upon the
Property for the purpose of conducting the Inspections and for no other purpose
provided that in each such instance (i) Purchaser notifies Seller of such
Inspections not less than 48 hours prior to such entry; (ii) such Inspections
are subject to and scheduled with Seller's property manager; and (iii)
Purchaser is in full compliance with Section 3.2(f) hereof. At Seller's
election, a representative of Seller shall be present during any entry by
Purchaser or its representatives upon the Property for conducting said
Inspections. Purchaser shall take all necessary actions to insure that neither
it nor any of its representatives shall interfere with the ongoing operations
occurring at the Property during the course of performing any such Inspections.
Purchaser shall not cause or permit any mechanic liens, materialmen's liens or
other liens to be filed against the Property as a result of the Inspections.
(b) Purchaser shall have through the last day of the Due
Diligence Period in which to conduct its due diligence investigations and
analysis of the Property and of all information pertaining to the Property,
and, in Purchaser's sole discretion, to determine whether the Property is
acceptable to Purchaser. If during the Due Diligence Period, Purchaser becomes
aware of any problem or defect in the Property or other aspect of the Property
which Purchaser determines makes the Property unsuitable to Purchaser,
Purchaser may terminate this Agreement by giving written notice of termination
to Seller on or before the last day of the Due Diligence Period. If Purchaser
does not timely give notice of termination as aforesaid, Purchaser shall be
deemed to have accepted the Property and this Agreement shall continue in full
force and effect. In the event of such termination, the Xxxxxxx Money shall be
returned to Purchaser and neither party shall have any further obligations to
the other party hereunder, except for the Surviving Obligations.
(c) Purchaser shall, as soon as reasonably practicable
and, in any event, at least five (5) days prior to the Closing Date, notify
Seller in writing requesting termination of any or all of the Service Contracts
that Purchaser desires to have terminated. Seller shall give any required
notice of termination as soon as reasonably practicable after receipt of
Purchaser's notice requesting same. Notwithstanding the foregoing, Purchaser
acknowledges and agrees that any such termination by Seller (i) may be
conditioned on the completion of the Closing, and (ii) shall be effective only
after expiration of any notice or grace period specified by the terns of the
applicable Service Contracts. Any Service Contracts not effectively terminated
as of the Closing Date shall be assumed by Purchaser.
(d) Purchaser shall have the right to conduct, at its
sole cost and expense, any inspections, studies or tests that Purchaser deems
appropriate in determining the condition of the Property, provided, however,
Purchaser is not permitted to perform any intrusive testing, including, without
limitation, a Phase II environmental assessment or borings, without the prior
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written consent of Seller. In the event this Agreement is terminated for any
reason, Seller may require Purchaser to deliver to Seller a complete copy of
any environmental studies, reports, tests results, analyses and similar
documents prepared by or on behalf of Purchaser or its agents; provided,
however, Purchaser shall have no obligation to provide such items to Seller
unless and until Seller reimburses Purchaser for the cost of such items.
(e) Purchaser agrees and covenants with Seller not to
disclose to any third party (other than Purchaser's lenders, accountants,
attorneys and other professionals and consultants working for Purchaser on this
transaction) without Seller's prior written consent, unless Purchaser is
obligated by law to make such disclosure, any of the reports or any other
documentation or information obtained by Purchaser which relate to the Property
or Seller in any way, all of which shall be used by Purchaser and its agents
solely in connection with the transaction contemplated hereby.
(f) Purchaser agrees to indemnify, defend and hold Seller
and its partners, trustees, beneficiaries, shareholders, managers, advisors and
other agents and their respective employees, officers, directors and
shareholders (the "Indemnified Parties") harmless from and against any and all
claims, losses, damages, costs and expense (including, without limitation,
attorneys fees' and court costs) suffered or incurred by any of the Indemnified
Parties as a result of or in connection with any activities of Purchaser
(including activities of any of Purchaser's employees, consultants, contractors
or other agents) conducted pursuant to this Section 3.2 or otherwise,
including, without limitation, mechanics' liens, damage to the Property and
injury to persons or property resulting from such activities and, in connection
therewith, in the event that the Property is disturbed or altered in any way as
a result of such activities, Purchaser shall promptly restore the Property to
its condition existing prior to the commencement of such activities.
Furthermore, Purchaser agrees to maintain and cause any of its representatives
or agents conducting any inspections to maintain and have in effect workers'
compensation insurance, with statutory limits of coverage, and commercial
general liability insurance with (i) appropriate coverages, (ii) waiver of
subrogation, and (iii) limits of not less than One Million and 00/100
($1,000,000.00) for personal injury, including bodily injury and death, and
property damage. Such insurance shall name Seller and Heitman Capital
Management Corporation as additional insured parties and shall be with
companies, with deductibles and otherwise in form reasonably acceptable to
Seller. Purchaser shall deliver to Seller a copy of the certificate of
insurance effectuating the insurance required hereunder prior to the
commencement of such activities.
(g) Purchaser acknowledges and agrees that it shall have
no right to review or inspect any of the Excluded Documents. Seller, at its
option, may make all or portions of Excluded Documents available for review by
Purchaser. "Excluded Documents" shall mean (a) internal memoranda,
correspondence, analyses, documents or reports prepared by or for Seller in
connection with the sale contemplated by this Agreement or in connection with
its ownership or operation of the Property, (b) communications between Seller
or any affiliate and their attorneys or other agents or representatives, and
(c) appraisals, assessments or other valuations of the Property in the
possession of Seller.
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(h) The provisions of this Section 3.2 shall survive
Closing or any termination of this Agreement (collectively, the "Surviving
Obligations").
3.3 Title and Survev and Traffic Signal. Seller, at its sole cost
and expense, has obtained and delivered to Purchaser for Purchaser's review:
(a) a commitment for an ALTA owner's policy of title insurance in the amount of
the Purchase Price with extended coverage over all general exceptions, a 3.1
zoning endorsement (with parking), an endorsement insuring that there are no
violations of any restrictive covenants affecting the Property, a contiguity
endorsement and an access endorsement (the "Title Commitment") on the Real
Property issued by the Title Company and (b) a current ALTA survey of the
Property (the "Survey"). Seller also has caused the Title Company to deliver
to Purchaser a copy of each instrument listed as an exception to title or
referred to therein. On or before the date hereof, Purchaser has examined the
Title Commitment and Survey and delivered to Seller a letter specifying the
matters in the Title Commitment and Survey to which Purchaser objects, a copy
of which letter is attached hereto as Exhibit L. Except for the matters to
which Purchaser has expressly objected as identified in said letter, Purchaser
shall be deemed to have accepted all exceptions to the Title Commitment and the
form and substance of the Survey, and all matters shown thereon, and all such
matters shall be included in the term "Permitted Exceptions" as used herein.
Seller shall cure (by removal, endorsement or otherwise) such objections on or
before the Closing Date. Notwithstanding the foregoing, Seller shall not be
deemed to be in default of this Agreement if it fails to cure any objections to
the Title Commitment or the Survey over which it has no control or which did
not arise as a result of any action or inaction of Seller ("Non-Removable
Objections"). If the Non-Removable Objections are not cured by Seller, or
waived by Purchaser, by the scheduled Closing Date then Purchaser may at its
option, and as its sole remedy, terminate this Agreement, in which event the
Xxxxxxx Money shall be returned to Purchaser and neither party shall have any
further obligations to the other party except for the Surviving Obligations.
In the event Seller fails to cure all objections to the Title Commitment or the
Survey other than the Non-Removable Objections on or before the Closing Date,
then the provisions of paragraph 17(a) shall be applicable. In addition to
accepting the Permitted Exceptions noted in the Title Commitment or on the
Survey, Purchaser acknowledges and agrees as follows, notwithstanding any other
provision hereof to the contrary: (i) Seller has advised Purchaser that the
applicable governmental authority has installed or is intending to install on
or over the public roadway adjacent to the Property a traffic signal, and said
authority has requested Seller, and Seller has agreed, to grant an easement to
said authority over a portion of the Property to permit such authority to
install and maintain on the Property certain equipment required to operate said
traffic signal, all as more fully described in Exhibit M attached hereto; (ii)
Purchaser approves of the installation of such signal and equipment and the
granting of such easement; and (iii) such easement shall be a Permitted
Exception for all purposes hereunder. Seller covenants with Purchaser that
Seller is not entitled to receive any compensation for permitting the
installation of such signal and equipment and, in the event that Seller
receives any such compensation, Seller shall promptly pay same over to
Purchaser (provided that the closing occurs).
3.4 Tenant Estoppels. Seller shall deliver to Purchaser, no later
than five (5) days prior to the Closing Date, estoppel certificates, in the
form of Exhibit G attached hereto or in
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the form of estoppel required under such tenant's lease, with no material
changes thereto as to either form or content, from tenants occupying at least
seventy-five percent of the square footage of the Property currently occupied,
which shall include Walgreens and Dominick's. In the event Seller fails to
deliver the required estoppel certificates, Seller shall not be deemed in
default of this Agreement, but Purchaser may terminate this Agreement in which
event the Xxxxxxx Money shall be returned to Purchaser and neither party shall
have any further obligations to the other party except for the Surviving
Obligations. If Purchaser does not elect to terminate this Agreement, Seller
shall provide its own estoppel certificates in place of those which were
supposed to have been (but were not) provided by tenants, and in the form
attached hereto as Exhibit G-1, and the information contained in such
Seller-provided estoppel certificates shall be deemed a representation by
Seller that shall survive the Closing for a period of one year and that shall
be limited in the same manner as Seller's other representations herein (as
provided in the last three grammatical paragraphs of Section 6 below).
Notwithstanding the foregoing: (a) Seller shall not be obligated to provide its
own estoppel certificate concerning the Walgreens or Dominick's Lease,
(b) Seller shall not be obligated to provide its own estoppel certificates for
more than twenty-five percent of the square footage of the Property currently
occupied and (c) in the event that Seller delivers or causes to be delivered to
Purchaser after Closing an estoppel certificate from a tenant for which Seller
provided its own estoppel certificate, such estoppel certificate provided by
the Seller shall be null and void and, at Seller's request, shall be returned
by Purchaser to Seller.
4. Closing; Conditions; Deliveries.
4.1 Time; Place and Manner of Closing. The Closing shall be held
on the Closing Date in the offices of the Title Company or at any location
mutually acceptable to the parties; provided, however, that the parties shall
deliver all documents and satisfy all other conditions by the close of business
on the day prior to the Closing Date so that only the payment of the Purchase
Price need actually occur on the Closing Date.
4.2 Condition to Parties' Obligation to Close. In addition to all
other conditions set forth herein, the obligation of Seller, on the one hand,
and Purchaser, on the other hand, to consummate the transaction contemplated
hereunder shall be contingent upon the following:
(a) The other party's representations and warranties
contained herein shall be true and correct in all material respects as of the
date of this Agreement and the Closing Date;
(b) As of the Closing Date, the other party shall have
performed its obligations hereunder in all material respects and all deliveries
to be made at Closing have been tendered;
(c) As of the Closing Date, there shall exist no pending
or known threatened action, suit or proceeding with respect to the other party
before or by any court or administrative agency which seeks to restrain or
prohibit, or to obtain damages or discovery
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order with respect to, this Agreement or the consummation of the transactions
contemplated hereby.
4.3 Deliveries. At Closing each party shall execute and deliver to
the other and/or the Title Company the following documents:
(a) Seller shall deliver to Purchaser and/or the Title
Company:
(i) a trustee's deed (the "Deed") to the Property
in recordable form, duly executed by the
Trust and acknowledged and in the form
customarily used by LaSalle National Trust,
N.A. as its trustee's deed, conveying to
Purchaser or Purchaser's nominee fee simple
title to the Real Property, subject to the
Permitted Exceptions;
(ii) a xxxx of sale duly executed by Beneficiary
and in substantially the same form as set
forth in Exhibit D attached hereto, conveying
to Purchaser title to all personal property
owned by Beneficiary and located at the Real
Property, if any;
(iii) an assignment of leases duly executed by the
Trust and in substantially the same form as
set forth in Exhibit E attached hereto,
vesting in Purchaser all of the Trust's
right, title and interest in and to the
Leases;
(iv) an assignment of all service contracts,
licenses and permits affecting the Property
(to the extent freely assignable) duly
executed by Beneficiary and in substantially
the same form as set forth in Exhibit F
attached hereto;
(v) a non-foreign transferor certification
pursuant to Section 1445 of the Internal
Revenue Code and any similar provisions of
applicable state law, in substantially the
same form as set forth on Exhibit K attached
hereto (the "Affidavit");
(vi) a Bulk Sales Stop Order from the Illinois
Department of Revenue (the "Department")
issued pursuant to the provisions of Section
902(d) of the Illinois Income Tax Act and
Section 444(j) of the Retailers Occupation
Tax Act (collectively, the "Acts") or, if
available, a release (the "Release") of
claims by the Department with respect to the
transaction contemplated by this Agreement.
If the Release is not available, the amount
to be withheld pursuant to the Bulk Sales
Stop Order shall be held in the closing
escrow by the Title Company until it receives
the Release, whereupon the Title Company
shall pay to Seller the entire amount
withheld; provided, however, that, if the
delivery
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of the Release is subject to a demand for
payment to the Department of all or a portion
of the amount withheld, the Title Company
may, at the discretion of Seller, pay such
sums in accordance with the demand and pay
the balance, if any, to Seller;
(vii) in the event that at least ninety-eight
percent (98%) of the leasable area of space
at the Property is not leased as of the
Closing Date, then on the Closing Date Seller
and Purchaser shall execute a master lease
(the "Master Lease"), whereunder Seller
leases a portion of the vacant space as of
Closing to bring the Property to a
ninety-eight percent leased level. The
Master Lease shall be in form mutually
acceptable to Seller and Purchaser, and
Seller and Purchaser agree to negotiate the
Master Lease in good faith. The Master Lease
shall contain the following terms and
conditions: (A) the term of the Master Lease
shall commence on the Closing Date and expire
on the earliest to occur of (x) one year
after the Closing Date, (y) the date on which
there is leased to one or more third parties
a portion of the vacant space at Closing
equal to at least the number of square feet
that would have caused the Property to be
ninety-eight percent leased if such space had
been leased at the time of Closing or (z) the
date on which the entire amount of the
escrowed funds described in clause (D) below
has been paid to Purchaser; (B) base rent
payable on a monthly basis at an annual rate
of $18.00 per square foot per year (i.e.
$1.50 per square foot per month); (C) the
automatic release of an amount of space from
the Master Lease equal to the amount of any
portion of the vacant space leased to a third
party, which release shall occur at such time
as such third party executes a lease for such
portion of the vacant space and commences the
payment of rent under such lease; (D)
Seller's aggregate and sole liability under
the Master Lease being limited to $30,000,
which amount shall be deposited into an
escrow at Closing and disbursed to Purchaser
on a monthly basis to pay Seller's
obligations under the Master Lease; and (E)
Purchaser's agreement to use its good faith
efforts to lease the vacant space to third
parties and to pay all costs incurred to
lease such space to third parties;
(viii) Letters to the tenants of the Property in the
form of Exhibit I attached hereto; and
(ix) Notices in substantially the form attached
hereto as Exhibit J attached hereto to the
other party to each Service Contract assumed
by Purchaser pursuant to Section 3.2(c) of
this
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Agreement, modified as required to be
consistent with the terms of the applicable
Service Contract.
(b) Purchaser shall pay or deliver to Seller or the Title
Company:
(i) the Cash Balance, by wire transfer, as
provided in Section 2.2 hereof;
(ii) an assumption duly executed by the Purchaser
of the assignments described in Paragraphs
4.3(a)(iii) and (iv);
(iii) a Certified Resolution of Purchaser
certifying that Purchaser has the legal
power, right and authority to consummate the
purchase of the Property; and
(iv) the Master Lease.
(c) Seller and Purchaser shall jointly deliver:
(i) A Closing Statement; and
(ii) All transfer declarations or similar
documentation required by law.
(d) Seller shall cause the Title Company to deliver to
Purchaser an initialed xxxx-up of the Title Commitment, extending the effective
date to the Closing Date, insuring Purchaser as owner of the Real Property, and
removing all exceptions other than Permitted Exceptions.
4.4 Permitted Termination. So long as a party is not in default
hereunder, if any condition to such party's obligation to proceed with the
Closing hereunder has not been satisfied or waived as of the Closing Date or
such earlier date as provided herein, such party may, in its sole discretion,
terminate this Agreement by delivering written notice to the other party before
the Closing Date, or elect to close, notwithstanding the non-satisfaction of
such condition, in which event such party shall be deemed to have waived any
such condition. In the event such party elects to close, there shall be no
liability on the part of any other party hereto for breaches of representations
and warranties of which the party electing to close had actual knowledge as of
the Closing.
5. Prorations. All items of income and expense shall be paid, prorated or
adjusted as follows:
5.1 Base Rent. All base rent or minimum rent under the Leases
shall be prorated so that with respect to any such base rent or minimum rent
collected by the Seller from tenants under the Leases for the month in which
the Closing Date occurs, Purchaser shall be entitled
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to a credit equal to the total of such collected rent, divided by the number of
days in the month in which the Closing Date occurs, and multiplied by the
number of days commencing with and including the Closing Date and ending with
and including the last day of the month in which the Closing Date occurs. With
respect to any base rent or minimum rent under the Leases for the month in
which the Closing Date occurs or any prior month which has not been collected
by Seller, there shall be no proration; however, any such base rent or minimum
rent received by either Seller or Purchaser after the Closing Date shall be
deemed to apply on a tenant by tenant basis (A) first on account of any amount
that is due Purchaser from such tenant for obligations that accrued under such
tenant's lease after the Closing Date; (B) next on account of any amount due
Seller from such tenant(s) for the period up to but not including the Closing
Date; and (C) finally any balance then remaining to Purchaser; and Purchaser
and Seller agree to make such payments to each other as may be required to give
effect to such deemed application. If any past due rent or other amounts
payable to Seller under the Leases is not paid to Seller within sixty (60) days
after the Closing, Seller shall have the right to attempt to effect collection
by litigation or otherwise so long as Seller does not take any action to
terminate the tenant's Lease or right to possession. Purchaser shall cooperate
with Seller in Seller's efforts to collect such past due rent, but shall not,
under any circumstances, be required to take any action against any tenant to
terminate such tenant's Lease or right to possession.
5.2 Percentage Rent. The total annual percentage rent payable
under each Lease shall be prorated between Purchaser and Seller based solely on
Purchaser's and Seller's respective days of ownership of the Property during
the applicable lease years in which the Closing occurs, regardless of what
portions of the tenants' annual sales occur during the different parts of such
years. Accordingly, at such time as percentage rent is paid by any tenant for
its lease year in which the Closing occurs, (a) Seller shall be entitled to
promptly receive a portion thereof determined by multiplying the total amount
thereof by a fraction, the numerator of which is the number of days during such
lease year that Seller owned the Property and the denominator of which is the
total number of days in such lease year and (b) Purchaser shall be entitled to
promptly receive the remaining portion thereof determined by multiplying the
total amount thereof by a fraction, the numerator of which is the number of
days during such lease year that Purchaser owned the Property and the
denominator of which is the total number of days in such lease year.
5.3 Security Deposits. All security deposits paid by tenants
under the terms of the Leases shall be credited to Purchaser on the Closing
Date; provided, however, that (i) if at any time prior to the Closing Date the
Seller applied all or any portion of a security deposit towards obligations
owed by a tenant under a given Lease; and (ii) the tenant under such Lease
verifies in its estoppel letter that the security deposit under its Lease has
been reduced from its original amount and that it does not dispute such
reduction, then in such event only the reduced security deposit shall be
credited to the Purchaser on the Closing Date.
5.4 Tenant CAM and Other Expense Contributions. For purposes
hereof, the term "Expenses" shall mean all common area maintenance costs and
other operating expenses of the Property, excluding real estate taxes and other
items expressly covered in other provisions of
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this Section 5. All payments by the tenant to the landlord under the Leases
for Expenses ("Tenant Expense Contributions") shall be prorated between Seller
and Purchaser as follows:
(a) Seller and Purchaser shall each be entitled to
receive and retain a percentage of the total Tenant Expense Contributions paid
by the tenants in the calendar year of Closing (the "Applicable Year") equal to
the percentage of the actual Expenses for the Applicable Year paid by said
party. As an example, if the total Expenses for the year of Closing (i.e.
1996) are $200,000, of which Seller pays $150,000 and Purchaser pays $50,000,
and the total Tenant Expense Contributions for such year are $160,000, then
Seller shall be entitled to $120,000 (75% of $160,000) of said Tenant Expense
Contributions and Purchaser shall be entitled to $40,000 (25% of $160,000)
thereof.
(b) At Closing, Seller shall give Purchaser a credit for
a prorated portion of the Tenant Expense Contributions paid in advance for the
month of Closing determined by multiplying the total such Tenant Expense
Contributions paid for such month by a fraction, the numerator of which is the
number of days from and including the date of Closing to and including the last
day of such month and the denominator of which is the total number of days in
such month.
(c) At the time of the final calculation and collection
from the tenants of the Tenant Expense Contributions for the Applicable Year,
whether in the nature of year-end reconciliations or payments in arrears,
Seller and Purchaser shall reprorate said Tenant Expense Contributions based on
the total amount thereof and the total actual Expenses as contemplated under
Paragraph (a) above. If, as a result of said reproration, the parties
determine that either Seller or Purchaser received from the tenants (as
adjusted for the proration made at Closing pursuant to Paragraph (b) above) an
amount of Tenant Expense Contributions in excess of the amount to which such
party is entitled pursuant to Paragraph (a) above, such party shall pay such
excess to the other party, within fifteen (15) days after the reproration is
determined. In connection with the foregoing, Purchaser and Seller agree to
cooperate with each other concerning the calculation of the reproration,
including, without limitation, the delivery by each party to the other of true
and correct information concerning the actual Expenses paid and the Tenant
Expense Contributions collected by said party, and Purchaser agrees to use its
good faith efforts in collecting Tenant Expense Contributions after Closing,
including the prompt preparation and delivery to the tenants of all required
year-end reconciliation statements approved by Seller. Seller shall deliver to
Purchaser at Closing information concerning the Expenses paid and Tenant
Expense Contributions collected by Seller prior to the Closing to the extent
reasonably available to Seller at that time.
5.5 Real Estate Taxes and Tenant Real Estate Tax Contributions.
Purchaser and Seller agree to pay and be responsible for real estate taxes
assessed against the Property and to share tenant contributions toward said
taxes as follows:
(a) On or before the Closing, Seller shall have paid or
shall pay both the first and second installments of the real estate taxes
payable in the year in which the Closing occurs
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(i.e. the 1995 taxes payable in 1996). Purchaser shall pay and shall be
responsible for all real estate taxes payable in the years after the year in
which Closing occurs.
(b) Tenant contributions payable by the tenants to the
landlord under the Leases for real estate taxes ("Tenant Tax Contributions")
shall be shared as follows:
(i) Seller shall be entitled to xxxx, collect and
retain (without crediting Purchaser for any
portion thereof) (A) the Tenant Tax
Contributions that are payable by Dominick's
and Walgreens as reimbursement for the taxes
payable in the year in which the Closing
occurs (i.e. the 1995 taxes payable in 1996,
which are to be paid by Seller pursuant to
Paragraph (a) above) and (B) all Tenant Tax
Contributions payable by the tenants at the
Property other than Walgreens and Dominick's
(the "Other Tenants") up to and including
September 4, 1996 (the "Cut-Off Date"). The
amounts to which Seller is entitled under
this Paragraph (i) shall, to the extent not
collected by Seller prior to Closing, remain
accounts receivable owed to and owned by
Seller and shall not be transferred by this
Agreement or any of the documents executed in
connection herewith.
(ii) Purchaser shall be entitled to xxxx, collect
and retain (without crediting Seller for any
portion thereof) (A) all Tenant Tax
Contributions payable by the Other Tenants on
or after the Cut-Off Date until the end of
the year in which the Closing occurs and (B)
all Tenant Tax Contributions payable by any
and all tenants (including Walgreens,
Dominick's and the Other Tenants) in the
years after the year in which the Closing
occurs.
(c) The real estate taxes shall be paid and the Tenant
Tax Contributions shall be shared as specified above, and there shall be no
other proration, reproration or credit with respect thereto.
5.6 Actual Expenses shall be prorated between Purchaser and Seller
based upon the actual days of their respective ownership of the Property
utilizing the actual Expenses or reasonable estimates. Tenant Expense
Contributions shall be prorated as provided in subsection 5.4 above.
5.7 Utilities not directly metered and paid by tenants shall be
prorated as of the Closing Date based upon either meter readings on the Closing
Date or the prior month's actual invoices. Seller shall be credited with any
unapplied utility deposit in effect as of the Closing Date to the extent such
deposit is assignable.
All other items which are customarily prorated in transactions similar to the
transaction contemplated hereby and which were not heretofore dealt with, will
be prorated as of the
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Closing Date. In the event any prorations or computations made under this
Section are based upon estimates or prove to be incorrect, then either party
shall be entitled to an adjustment to correct the same, provided that it makes
written demand on the party from whom it is entitled to such adjustment within
one hundred and twenty days after the end of the current calendar year. For
purposes of calculating the prorations provided for in this Agreement,
Purchaser shall be deemed to be the owner of the Property on the date of
Closing.
6. Seller's Representations. Warranties and Covenants. The Trust hereby
represents and covenants and Beneficiary hereby represents, warrants and
covenants as follows:
6.1 Power. Seller has the legal power, right and authority to
enter into this Agreement and the instruments referenced herein and to
consummate the transactions contemplated hereby.
6.2 Requisite Action. Seller has obtained all requisite consents
necessary to authorize Seller to enter into this Agreement and to consummate
the transaction contemplated hereby.
6.3 Authority. The individuals executing this Agreement and the
instruments referenced herein on behalf of Seller have the legal power, right
and actual authority to bind Seller to the terms and conditions hereof and
thereof.
6.4 Validity. This Agreement and all documents required hereby to
be executed by Seller are and shall be valid, legally binding obligations of
and enforceable against Seller in accordance with their terms.
6.5 Conflicts. Neither the execution and delivery of this
Agreement and documents referenced herein, nor the incurrence of the
obligations set forth herein, nor the consummation of the transactions herein
contemplated, nor referenced herein conflict with or result in the material
breach of any terms, conditions or provisions of or constitute a default under,
any bond, note, or other evidence of indebtedness or any contract or lease to
which Seller is a party.
6.6 Leases. Attached hereto as Schedule 1 is a complete and
accurate list of the Leases, which shall be updated by Seller prior to Closing,
if necessary. None of the Leases grants the tenant the right to purchase all
or any part of the Property.
6.7 Service Contracts. Attached hereto as Schedule 2 is a
complete and accurate list of the Service Contracts, which shall be updated by
Seller prior to Closing, if necessary.
6.8 Notices. Seller has not received any written notice that the
Property, or any of its present uses and operations thereof, are in current
violation of any applicable zoning, land use, building, fire, health, labor,
safety, subdivision and other laws or regulations.
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6.9 Litigation. Except as set forth on Schedule 3, no litigation
has been served upon Seller, filed, or threatened in writing, with respect to
the Property that remains outstanding. Schedule 3 shall be updated by Seller
prior to Closing, if necessary.
6.10 Employees. There are no persons employed by Seller in
connection with the operation of the Property.
6.11 Environmental Condition. Seller has no knowledge of any
violation of Environmental Laws related to the Property or the presence or
release of Hazardous Materials on or from the Property except as disclosed in
the environmental report delivered by Seller to Purchaser or made available for
Purchaser's review. The term "Environmental Laws" includes without limitation
the Resource Conservation and Recovery Act and the Comprehensive Environmental
Response Compensation and Liability Act ("CERCLA") and other federal laws
governing the environment as in effect on the date of this Agreement together
with their implementing regulations and guidelines as of the date of this
Agreement, and all state, regional, county, municipal and other local laws,
regulations and ordinances that are equivalent or similar to the federal laws
recited above or that purport to regulate Hazardous Materials in effect as of
the date of this Agreement. "Hazardous Materials" means any substance which is
(i) designated, defined, classified or regulated as a hazardous substance,
hazardous material, hazardous waste, pollutant or contaminant under any
Environmental Law, as currently in effect as of the date of this Agreement (ii)
petroleum hydrocarbon, including crude oil or any fraction thereof and all
petroleum products, (iii) PCBs, (iv) lead, (v) friable asbestos, (vi) flammable
explosives, (vii) infectious materials or (viii) radioactive materials.
6.12 Intentionally Omitted.
6.13 Indemnity. Seller shall indemnify and hold Purchaser harmless
from and against any and all claims, actions, judgments, liabilities, liens,
damages, penalties, fines, costs and reasonable attorneys' fees, foreseen or
unforeseen, asserted against, imposed on or suffered or incurred by Purchaser
(or the Property) directly or indirectly arising out of or in connection with
any breach of the warranties, representations and covenants set forth in this
Section 6.
The warranties and representations set forth in this Agreement shall
be deemed remade as of Closing, and said warranties and representations as so
remade, and the indemnity obligation set forth herein shall survive Closing,
provided that any claim by Purchaser based upon a misrepresentation or breach
of any warranty or representation or indemnity obligation under this Agreement
shall be deemed waived unless Purchaser has given Seller written notice of such
claim prior to the date which is one year from the Closing Date.
As used in this Agreement, the term "to Seller's knowledge" "actual
knowledge" or "best of Sellers knowledge" or any other reference to the
knowledge of Seller (i) shall mean and apply to the actual knowledge of Xxx
Xxxxxx, Xxxx Xxxxxxxx and Xxxx Xxxxxxx (collectively, the "Knowledge
Individuals") and not to any other parties, (ii) shall mean the actual
knowledge of such individuals, without any investigation or inquiry of any
kind, it being understood and acknowledged that such individuals, in some
instances, are not involved in the
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day-to-day operations of the Property and in some instances were not involved
in the negotiation or execution of any leases, management contracts, or service
contracts; (iii) shall not mean such individuals are charged with knowledge of
the acts, omissions and/or knowledge of the predecessors in title to the
Property or with knowledge of the acts, omissions and/or knowledge of Seller's
agents or employees; (iv) shall not apply to or to be construed to apply to
information or material which may be in the possession of Seller generally or
incidentally, but which is not actually known to the individuals who are
directly engaged in the management of the Property and the sale and purchase
transaction described herein. Similarly, any reference to any written notice,
claim, litigation filing or other correspondence or transmittal to Seller set
forth herein shall be limited to refer to only those actually received by or
known to the Knowledge Individuals in the limited manner provided in clauses
(i)-(iv) above.
Notwithstanding anything contained in this Agreement to the contrary,
all of the representations, warranties and certifications (the
"Representations") which are made by Seller and set forth herein or in any of
the documents or instruments required to be delivered by Seller hereunder,
shall be subject to the following conditions and limitations: (i) there shall
no liability on the part of Seller for breaches of Representations of which
Purchaser had knowledge of at Closing; and (ii) in the event that prior to the
time of Closing, during the course of Purchaser's inspections, studies, tests
and investigations conducted pursuant to Paragraph 3.2 hereof, or through other
sources, Purchaser gains knowledge of a fact or circumstance which, by its
nature, indicates that a Representation was or has become untrue or inaccurate,
and such fact or circumstance was not intentionally withheld from Purchaser by
Seller with the intent to defraud Purchaser, then Purchaser shall not have the
right to bring any lawsuit or other legal action against Seller, nor pursue any
other remedies against Seller, as a result of the breach of the Representation
caused thereby, but Purchaser's sole right shall be to terminate this Agreement
in which event, the Xxxxxxx Money shall be returned to Purchaser and neither
party shall have any further obligations to the other party hereunder except
for the Surviving Obligations. Without limiting Section 18.7 or any other
provision hereof, the parties hereto expressly acknowledge and agree that none
of Seller's representations, warranties or covenants herein may be relied on by
the Title Company, whether by subrogation or otherwise.
7. PURCHASE AS-IS. EXCEPT FOR THE REPRESENTATIONS OF SELLER EXPRESSLY SET
FORTH IN SECTION 6 OF THIS AGREEMENT, PURCHASER WARRANTS AND ACKNOWLEDGES TO
AND AGREES WITH SELLER THAT PURCHASER IS PURCHASING THE PROPERTY IN ITS "AS-IS,
WHERE IS" CONDITION "WITH ALL FAULTS" AS OF THE CLOSING DATE AND SPECIFICALLY
AND EXPRESSLY WITHOUT ANY WARRANTIES, REPRESENTATIONS OR GUARANTEES, EITHER
EXPRESS OR IMPLIED, AS TO ITS CONDITION, FITNESS FOR ANY PARTICULAR PURPOSE,
MERCHANTABILITY, OR ANY OTHER WARRANTY OF ANY KIND, NATURE, OR TYPE WHATSOEVER
FROM OR ON BEHALF OF SELLER. EXCEPT FOR THE REPRESENTATIONS OF SELLER
EXPRESSLY SET FORTH IN SECTION 6 OF THIS AGREEMENT, SELLER SPECIFICALLY
DISCLAIMS ANY WARRANTY, GUARANTY OR REPRESENTATION, ORAL OR WRITTEN, PAST OR
PRESENT, EXPRESS OR IMPLIED, CONCERNING (A) THE VALUE, NATURE, QUALITY OR
CONDITION OF THE PROPERTY, INCLUDING,
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WITHOUT LIMITATION, THE WATER, SOIL AND GEOLOGY, (B) THE INCOME TO BE DERIVED
FROM THE PROPERTY, (C) THE SUITABILITY OF THE PROPERTY FOR ANY AND ALL
ACTIVITIES AND USES WHICH PURCHASER MAY CONDUCT THEREON, INCLUDING THE
POSSIBILITIES FOR FUTURE DEVELOPMENT OF THE PROPERTY, (D) THE COMPLIANCE OF OR
BY THE PROPERTY OR ITS OPERATION WITH ANY LAWS, RULES, ORDINANCES OR
REGULATIONS OF ANY APPLICABLE GOVERNMENTAL AUTHORITY OR BODY, (E) THE
HABITABILITY, MERCHANTABILITY, MARKETABILITY, PROFITABILITY OR FITNESS FOR A
PARTICULAR PURPOSE OF THE PROPERTY, (F) THE MANNER OR QUALITY OF THE
CONSTRUCTION OR MATERIALS, IF ANY, INCORPORATED INTO THE PROPERTY, (G) THE
MANNER, QUALITY, STATE OF REPAIR OR LACK OF REPAIR OF THE PROPERTY, (H) THE
PRESENCE OR ABSENCE OF HAZARDOUS MATERIALS AT, ON, UNDER, OR ADJACENT TO THE
PROPERTY OR ANY OTHER ENVIRONMENTAL MATTER OR CONDITION OF THE PROPERTY; OR (I)
ANY OTHER MATTER WITH RESPECT TO THE PROPERTY. PURCHASER ACKNOWLEDGES AND
AGREES THAT SELLER IS NOT LIABLE OR BOUND IN ANY MANNER BY ANY ORAL OR WRITTEN
STATEMENTS, REPRESENTATIONS OR INFORMATION PERTAINING TO THE PROPERTY, OR THE
OPERATION THEREOF, FURNISHED BY ANY REAL ESTATE BROKER, AGENT, EMPLOYEE,
SERVANT OR OTHER PERSON EXCEPT FOR THE EXPRESS REPRESENTATIONS SET FORTH IN
SECTION 6 OF THIS AGREEMENT. PURCHASER FURTHER ACKNOWLEDGES AND AGREES THAT
PURCHASER IS A SOPHISTICATED AND EXPERIENCED PURCHASER OF PROPERTIES SUCH AS
THE PROPERTY AND HAS BEEN DULY REPRESENTED BY COUNSEL IN CONNECTION WITH THE
NEGOTIATION OF THIS AGREEMENT. EXCEPT AS MAY OTHERWISE BE PROVIDED HEREIN,
SELLER HAS MADE NO AGREEMENT TO ALTER, REPAIR OR IMPROVE ANY OF THE PROPERTY.
8. Purchaser's Representations. Warranties and Covenants. Purchaser
hereby represents, warrants and covenants as follows:
8.1 Power. Purchaser has the legal power, right and authority to
enter into this Agreement and the instruments referenced herein and to
consummate the transactions contemplated hereby.
8.2 Requisite Action. All requisite action (corporate, trust,
partnership or otherwise) has been taken by Purchaser in connection with the
entering into this Agreement and the instruments referenced herein and the
consummation of the transactions contemplated hereby. No consent of any
partner, shareholder, creditor, investor, judicial or administrative body,
authority or other party is required which has not been obtained to permit
Purchaser to enter into this Agreement and consummate the transaction
contemplated hereby, including but not limited to, any consent from Purchaser's
board of directors.
8.3 Authority. The individuals executing this Agreement and the
instruments referenced herein on behalf of Purchaser have the legal power,
right and actual authority to bind Purchaser to the terms and conditions hereof
and thereof.
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8.4 Validity. This Agreement and all documents required hereby to
be executed by Purchaser are and shall be valid, legally binding obligations of
and enforceable against Purchaser in accordance with their terms.
8.5 Conflicts. Neither the execution and delivery of this
Agreement and documents referenced herein, nor the incurrence of the
obligations set forth herein, nor the consummation of the transactions herein
contemplated, nor referenced herein conflict with or result in the material
breach of any terms, conditions or provisions of or constitute a default under,
any bond, note, or other evidence of indebtedness or any contract, lease or
other agreements or instruments to which Purchaser is a party.
8.6 Litigation. There is no action, suit or proceeding pending or
threatened against Purchaser in any court or by or before any other
governmental agency or instrumentality which would materially and adversely
affect the ability of Purchaser to carry out the transactions contemplated by
this Agreement.
8.7 Indemnity. Purchaser shall indemnify and hold Seller harmless
from and against any and all claims, actions, judgments, liabilities, liens,
damages, penalties, fines, costs and reasonable attorneys' fees, foreseen or
unforeseen, asserted against, imposed on or suffered or incurred by Seller
directly or indirectly arising out of or in connection with any breach of the
warranties, representations and covenants set forth in this Section 8. The
warranties and representations set forth in this Section 8 shall be deemed
remade as of Closing, and said warranties and representations as so remade, and
the indemnity obligation set forth in herein shall be deemed waived unless
Seller has given Purchaser written notice of any such claim prior to the date
which is one year from the Closing Date.
9. Closing Costs. Seller shall pay the following expenses incurred to
consummate the transaction described herein: (i) costs to obtain an extended
coverage ALTA owner's title policy with those endorsements specified in
paragraph 3.3 hereof, (iii) all state, county and city transfer taxes; (iv)
one-half of all closing escrow fees; and (v) Seller's legal fees and expenses.
Purchaser shall pay (a) the additional costs for endorsements other than those
specified above; (b) one-half of all closing escrow fees; (c) the fee for the
recording of the Deed; (d) all costs and expenses incurred in connection with
the transfer of any transferable permits or licenses in connection with the
ownership or operation of the Property; and (e) Purchaser's legal fees and
expenses.
10. Commissions. Seller shall be solely responsible for the payment of a
commission to Xxxxxx Xxxxxx Realty Advisers, Inc. (the "Broker") in the amount
of $170,000 and a commission to Inland Real Estate Networks Inc. (the
"Co-Operating Broker") in the amount of $50,000, in the event the proposed
transaction closes. Seller and Purchaser each warrant and represent to the
other that (other than the Broker and Co-Operating Broker) neither has had any
dealings with any broker, agent, or finder relating to the sale of the Property
or the transactions contemplated hereby, and each agrees to indemnify and hold
the other and their respective advisors (including Xxxxxxx Capital Management
Corporation, Seller's advisor) harmless against any claim for brokerage
commissions, compensation or fees by any broker,
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agent, or finder in connection the sale of the Property or the transactions
contemplated hereby resulting from the acts of the indemnifying party.
11. Escrow. On or prior to the Closing Date, the parties or their
respective attorneys shall establish a deed and money escrow with the Title
Company, as Escrowee, through which the transaction contemplated hereby shall
be closed. Upon opening of such escrow, the Xxxxxxx Money (plus interest
thereon) shall be disbursed from the joint order escrow being established
concurrently herewith and deposited in the deed and money escrow. The escrow
instructions for the deed and money escrow shall be in the form customarily
used by the Title Company with such special provisions added thereto as may be
required to conform to the provisions of this Agreement. Said escrow shall be
auxiliary to this Agreement, and this Agreement shall not be merged into nor in
any manner superseded by said escrow. Without limitation on the foregoing, it
is contemplated that the transaction shall be closed by means of a so-called
New York Style Closing, with the concurrent delivery of the documents of title,
transfer of interest, delivery of the title policy or marked-up title
commitment described in Section 4.3(d) and the payment of the Purchase Price.
Seller and Purchaser shall each provide any undertaking to the Title Company
necessary to accommodate the New York Style Closing. Seller and Purchaser
shall each pay 50% of the charges of the Title Company for such New York Style
Closing.
12. Attorneys' Fees and Costs. In the event suit or action is instituted
to interpret or enforce the terms of this Agreement, or in connection with any
arbitration or mediation of any dispute, the prevailing party shall be entitled
to recover from the other party such sum as the court, arbitrator or mediator
may adjudge reasonable as such party's costs and attorney's fees, including
such costs and fees as are incurred in any trial, on any appeal, in any
bankruptcy proceeding (including the adjudication of issues peculiar to
bankruptcy law) and in any petition for review. Each party shall also have the
right to recover its reasonable costs and attorney's fees incurred in
collecting any sum or debt owed to it by the other party, with or without
litigation, if such sum or debt is not paid within fifteen (15) days following
written demand therefor.
13. Notice. All notices, demands, deliveries and communications (a
"Notice") under this Agreement shall be delivered or sent by: (i) first class,
registered or certified mail, postage prepaid, return receipt requested or (ii)
nationally recognized overnight carrier, addressed to the address of the party
in question set forth in the first paragraph of this Agreement and copies to
the parties designated below or to such other address as either party may
designate by notice pursuant to this Section. Notices shall be deemed given
either one business day after delivery to the overnight carrier or three
business days after being mailed as provided in clause (i) above.
Notices to Seller copy to: Schwartz, Cooper, Xxxxxxxxxxx
& Xxxxxx, Chtd.
000 X. XxXxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxx X. Xxxxxx, Esq.
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Notices to Purchaser copy to: The Inland Group, Inc.
0000 Xxxxxxxxxxx Xxxx
Xxx Xxxxx, XX 00000
Attn: Xxxxxx X. Xxxx, General Counsel
14. Fire or Other Casualty: Condemnation.
14.1 If the Property or any part thereof is damaged by fire or
other casualty prior to the Closing Date which would cost in excess of One
Hundred Thousand Dollars ($100,000) to repair (as determined by an insurance
adjuster mutually selected by Purchaser and Seller), Purchaser may terminate
this Agreement by written notice to Seller given on or before the earlier of
(i) twenty (20) days following such casualty or (ii) the Closing Date. In the
event of such termination, this Agreement shall be of no further force and
effect and (except for the Surviving Obligations) neither party shall
thereafter have any further obligation under this Agreement, and Seller shall
direct the Title Company to promptly return all Xxxxxxx Money to Purchaser. If
Purchaser does not elect to terminate this Agreement, then the Closing shall
take place as herein provided without abatement of the Purchase Price, and
Seller shall assign and transfer to Purchaser on the Closing Date, without
warranty or recourse, all of Seller's right, title and interest to all
insurance proceeds paid or payable to Seller on account of such fire or
casualty and Seller shall pay the cost of the deductible of such insurance
policy.
14.2 If any material portion of the Property is taken in eminent
domain proceedings prior to Closing, Purchaser may terminate this Agreement by
notice to Seller given on or before the earlier of (i) twenty (20) days after
such taking or (ii) the Closing Date, and, in the event of such termination,
this Agreement shall be of no further force and effect and, except for the
Surviving Obligations, neither party shall thereafter have any further
obligation under this Agreement, and Seller shall direct the Title Company to
promptly return all Xxxxxxx Money to Purchaser. If Purchaser does not so elect
to terminate, the Closing shall take place as herein provided without abatement
of the Purchase Price, and Seller shall assign and transfer to Purchaser on the
Closing Date, without warranty or recourse, all of Seller's right, title and
interest in and to all condemnation awards paid or payable to Seller.
15. Operations After Date of This Agreement. Seller covenants and agrees
with Purchaser that after the date hereof through the Closing, Seller shall
conduct its business involving the Property as follows, and during such period
will (except as specifically provided to the contrary herein):
(a) Refrain from transferring any of the Property or creating on
the Property any easements, liens, mortgages, encumbrances, or other interests
which will survive Closing or permitting any changes to the zoning
classification of the Real Property, except the traffic light easement
described in Section 3.3 or any other Permitted Exceptions;
(b) Refrain from entering into or amending any contracts, or other
agreements (excluding leases) regarding the Property (other than contracts in
the ordinary and usual course
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of business and which are cancelable by the owner of the Property without
penalty within thirty (30) days after giving notice thereof);
(c) Continue to operate, maintain, and repair the Property in a
manner consistent with Seller's current practices;
(d) Fully comply with the terms of the Leases, and without the
prior written consent of Purchaser (which consent shall not be unreasonably
withheld by Purchaser), refrain from (i) amending any Leases of any portion of
the Property except in accordance with Paragraph (f) below, (ii) canceling any
of such Leases, or (iii) applying any security deposits under the Leases to
past due accounts;
(e) Refrain from offering the Property for sale or marketing the
same; and
(f) Refrain from executing any new leases (or amendments to
existing leases) without the prior written consent of Purchaser (which consent
shall not be unreasonably withheld). Purchaser shall not be deemed to have
unreasonably withheld its consent to a Proposal if it disapproves such Proposal
because, in Purchaser's reasonable judgment, the tenant improvement costs,
allowances, leasing commissions and other expenses are too high given the
overall economics of the Proposal. Seller shall submit to Purchaser a proposal
describing the economic terms of any proposed lease (or amendment) along with
financial information on the tenant (the "Proposal"). Purchaser shall provide
its written approval or disapproval of such Proposal within five days after
receipt of the Proposal. In the event Purchaser approves any such Proposal,
unless otherwise provided in the Proposal, Purchaser shall be solely
responsible for all tenant improvement costs, allowances, leasing commissions
and other expenses payable with respect to such Proposal (and the lease or
amendment arising therefrom). Seller shall have the right to execute the lease
document arising from any Proposal approved by Purchaser provided the Seller's
standard lease or amendment form is utilized without material modifications.
The parties acknowledge that (i) Purchaser has approved the Proposals for
certain new leases (or amendments to existing leases) with the tenants or
prospective tenants listed in Exhibit N attached hereto, (ii) with the
exception of the Starbucks transaction, none of such approved Proposals
requires the payment of any costs by the landlord and (iii) Purchaser shall be
solely responsible for all tenant improvement costs, allowances, leasing
commissions and other expenses payable with respect to the Starbucks Proposal
and the lease arising therefrom. In the event the Seller pays any amounts for
which Purchaser is responsible hereunder, Purchaser shall reimburse Seller
therefor at Closing. Purchaser also shall be solely responsible for all costs
and expenses attributable to any new leases, renewals, amendments or other
leasing activity effective after the Closing.
16. Assignment. Purchaser shall not assign this Agreement without
Seller's prior written consent which consent may be withheld for any reason or
no reason. Notwithstanding the foregoing, Purchaser shall be permitted,
without Seller's consent, to assign its rights, privileges, duties and
obligations under this Agreement to an entity which is an affiliate of The
Inland Group, Inc. Subject to the previous sentence, this Agreement shall apply
to, inure to the benefit of and be binding upon and enforceable against the
parties hereto and their respective
21
24
successors and assigns. Any assignment shall be conditioned upon the receipt
of a duly executed express assumption of all of the duties and obligations of
Purchaser.
17. Remedies.
(a) IN THE EVENT THAT SELLER SHALL FAIL TO CONSUMMATE THIS
AGREEMENT FOR ANY REASON, EXCEPT PURCHASER'S DEFAULT OR A TERMINATION OF THIS
AGREEMENT BY PURCHASER OR SELLER PURSUANT TO A RIGHT TO DO SO UNDER THE
PROVISIONS HEREOF, PURCHASER, AS ITS SOLE AND EXCLUSIVE REMEDIES, MAY TERMINATE
THIS AGREEMENT AND RECEIVE A REFUND OF THE XXXXXXX MONEY OR MAY APPLY TO A
COURT OF COMPETENT JURISDICTION FOR THE REMEDY OF SPECIFIC PERFORMANCE IN WHICH
LATTER CASE PURCHASER SHALL BE ENTITLED TO RECORD A LIS PENDENS OR NOTICE OF
PENDENCY OF ACTION AGAINST THE PROPERTY AND THE XXXXXXX MONEY SHALL REMAIN ON
DEPOSIT UNTIL THE DISPOSITION OF SUCH ACTION. IN THE EVENT PURCHASER OR SELLER
PREVAILS IN PURCHASER'S SUIT FOR SPECIFIC PERFORMANCE, THE PREVAILING PARTY
SHALL BE ENTITLED TO RECOVER FROM THE OTHER PARTY ITS COSTS OF SUIT, INCLUDING
ATTORNEYS FEES.
(b) IN THE EVENT THAT PURCHASER SHOULD FAIL TO CONSUMMATE THIS
AGREEMENT FOR ANY REASON, EXCEPT SELLER'S DEFAULT OR THE TERMINATION OF THIS
AGREEMENT BY PURCHASER PURSUANT TO A RIGHT TO DO SO UNDER THE TERMS AND
PROVISIONS HEREOF, THEN SELLER, AS ITS SOLE AND EXCLUSIVE REMEDY, MAY TERMINATE
THIS AGREEMENT BY NOTIFYING PURCHASER THEREOF AND RECEIVE AND RETAIN THE
XXXXXXX MONEY AS LIQUIDATED DAMAGES. THE PARTIES AGREE THAT SELLER WILL SUFFER
DAMAGES IN THE EVENT OF PURCHASER'S DEFAULT ON ITS OBLIGATIONS. ALTHOUGH THE
AMOUNT OF SUCH DAMAGES IS DIFFICULT OR IMPOSSIBLE TO DETERMINE, THE PARTIES
AGREE THAT THE AMOUNT OF THE XXXXXXX MONEY IS A REASONABLE ESTIMATE OF SELLER'S
LOSS IN THE EVENT OF PURCHASER'S DEFAULT. THUS, SELLER SHALL ACCEPT AND RETAIN
THE XXXXXXX MONEY AS FULL AND COMPLETE LIQUIDATED DAMAGES BUT NOT AS A PENALTY,
AND SUCH LIQUIDATED DAMAGES SHALL CONSTITUTE SELLER'S SOLE AND EXCLUSIVE
REMEDY. NOTWITHSTANDING THE FOREGOING: (i) IF SELLER IS REQUIRED TO BRING A
SUIT TO OBTAIN THE XXXXXXX MONEY, THEN, IN THE EVENT PURCHASER OR SELLER
PREVAILS IN SUCH SUIT, THE PREVAILING PARTY SHALL BE ENTITLED TO RECOVER FROM
THE OTHER PARTY ITS COSTS OF SUIT, INCLUDING ATTORNEYS FEES (WHICH, IN THE CASE
OF SELLER PREVAILING, SHALL BE IN ADDITION TO RECEIVING THE XXXXXXX MONEY); AND
(ii) NOTHING SET FORTH HEREIN SHALL LIMIT PURCHASER'S LIABILITY FOR THE
SURVIVING OBLIGATIONS IN THE EVENT OF TERMINATION OF THIS AGREEMENT.
22
25
SELLER AND PURCHASER ACKNOWLEDGE THAT THEY HAVE READ AND UNDERSTAND THE
PROVISIONS OF THE FOREGOING REMEDIES PROVISIONS BOTH IN THE CASE OF A DEFAULT
BY SELLER AND A DEFAULT BY PURCHASER AND AGREE TO BE BOUND BY THE TERMS OF SUCH
PROVISIONS.
18. Miscellaneous.
18.1 Entire Agreement. This Agreement, together with the exhibits
attached hereto, constitute the entire agreement of the parties hereto
regarding the purchase and sale of the Property, and all prior agreements,
understandings, representations and statements, oral or written, are hereby
merged herein. In the event of a conflict between the terms of this Agreement
and any prior written agreements, the terms of this Agreement shall prevail.
This Agreement may only be amended or modified by an instrument in writing,
signed by the party intended to be bound thereby.
18.2 Time. All parties hereto agree that time is of the essence in
this transaction.
18.3 Counterpart Execution. This Agreement may be executed in one
or more counterparts, each of which shall be deemed an original.
18.4 Governing Law. THIS AGREEMENT SHALL BE DEEMED TO BE A
CONTRACT MADE UNDER THE LAWS OF THE STATE OF ILLINOIS AND FOR ALL PURPOSES
SHALL BE GOVERNED BY AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF ILLINOIS.
18.5 Publicity. Seller and Purchaser hereby covenant and agree
that, at all times after the date of execution hereof, unless consented to in
writing by the other party, no press release or other public disclosure
concerning this transaction shall be made, and each party agrees to use best
efforts to prevent disclosure of this transaction.
18.6 Recordation. Purchaser shall not record this Agreement or a
memorandum or other notice thereof in any public office except in the event of
a default by Seller and election by Purchaser to pursue the remedy of specific
performance.
18.7 Benefit. This Agreement is for the benefit of Purchaser and
Seller and, except as otherwise expressly provided herein, no other person or
entity will be entitled to rely on this Agreement, receive any benefit from it
or enforce any provisions of it against Purchaser or Seller.
18.8 Section Headings. The Section headings contained in this
Agreement are for convenience only and shall in no way enlarge or limit the
scope or meaning of the various and several Sections hereof.
23
26
18.15 No Survival. Except as otherwise expressly provided herein,
the covenants, agreements and other provisions hereof shall not survive the
Closing.
19. Exculpation of Seller and Related Parties. Notwithstanding anything
to the contrary contained in this Agreement or in any exhibits hereto attached
or in any documents executed in connection herewith (collectively, including
this Agreement and said exhibits, the "Purchase Documents"), it is expressly
understood and agreed by and between the parties hereto that: (i) the recourse
of Purchaser or its successors or assigns against Seller with respect to the
alleged breach by or on the part of Seller of any representation, warranty,
covenant, undertaking, indemnity or agreement contained in any of the Purchase
Documents (collectively, "Seller's Undertakings") shall extend only to Seller's
interest in the Property (which shall include the net proceeds received by
Seller as a result of the Closing of the sale of the Property to Purchaser) and
not to any other assets of Seller or its shareholders, partner or beneficiaries
or any of the other persons or entities referred to in clause (ii) below; and
(ii) no personal liability or personal responsibility of any sort with respect
to any of Seller's Undertakings or any alleged breach thereof is assumed by, or
shall at any time be asserted or enforceable against, Seller or Heitman Capital
Management Corporation, or against any of their respective shareholders,
directors, officers, employees, agents, constituent partners, beneficiaries,
trustees or representatives, except to the extent of their interest in the
Property (or in the net proceeds from the sale thereof).
20. Trustee Exculpation. Notwithstanding anything contained herein to the
contrary, LaSalle National Trust, N.A. is executing this Agreement solely in
its capacity as Trustee, as aforesaid, and said Trustee shall have no personal
liability or responsibility for the performance or observance of any of the
covenants, agreements, representations, warranties or other duties or
obligations of the Seller hereunder, all such personal liability and
responsibility being expressly waived.
25
27
IN WITNESS WHEREOF, the parties hereto have caused these presents to
be made as of the day and year first above stated.
SELLER:
LASALLE NATIONAL TRUST, N.A., as Trustee under
Trust Agreement dated May 31, 1983 and
known as Trust Number 106520 AND NOT
PERSONALLY
By: /SIG/
----------------------------------
Its: ASSISTANT SECRETARY
----------------------------------
ENDOWMENT AND FOUNDATION REALTY PARTNERSHIP - JMB I,
an Illinois limited partnership
By: Heitman Capital Management Corporation,
an Illinois corporation,
Investment Advisor
By: /SIG/
----------------------------------
Its: Executive Vice President
----------------------------------
PURCHASER:
INLAND MONTHLY INCOME FUND III, INC.,
a Maryland corporation
By: /SIG/
----------------------------------
Its: Vice President
----------------------------------
26
28
Exhibit A - Legal Description
Exhibit B - Intentionally Deleted
Exhibit C - Intentionally Deleted
Exhibit D - Form of Xxxx of Sale
Exhibit E - Form of Assignment and Assumption of Leases
Exhibit F - Form of Assignment and Assumption of Contracts, Licenses and Permits
Exhibit G - Form of Tenant Estoppel Certificate
Exhibit Gl - Form of Estoppel Certificate of Sell
Exhibit H - Form of Xxxxxxx Money Escrow Agreement
Exhibit I - Form of Tenant Notification Letter
Exhibit J - Form of Vendor Notification Letter
Exhibit K - Form of Non-Foreign Affidavit
Exhibit L - Copy of Letter of Title Objections
Exhibit M - Description of Traffic Signal Easement
Exhibit N - List of Approved Tenant Proposals
Schedule 1 - List of Leases
Schedule 2 - List of Service Contracts
Schedule 3 - List of Litigation
27
29
EXHIBIT A
LEGAL DESCRIPTION
THAT PART OF OUTLOT 1 IN NEW CENTURY TOWN UNIT ONE, BEING A SUBDIVISION OF
PARTS OF SECTIONS 32 AND 33, TOWNSHIP 44 NORTH, RANGE 11, EAST OF THE THIRD
PRINCIPAL MERIDIAN, RECORDED NOVEMBER 2, 1973, AS DOCUMENT 1641342 IN BOOR 53
OF PLATS, PAGES 26, 27 AND 28, DESCRIBED AS FOLLOWS: COMMENCING AT THE SOUTH
EAST CORNER OF SAID OUTLOT 1; THENCE SOUTH 88 DEGREES 45 MINUTES 24 SECONDS
WEST ALONG A SOUTH LINE OF SAID OUTLOT 1, A DISTANCE OF 50.00 FEET; THENCE
SOUTH 0 DEGREES 38 MINUTES 22 SECONDS EAST ALONG AN EASTERLY LINE OF SAID
OUTLOT 1, A DISTANCE OF 10.00 FEET; THENCE SOUTH 88 DEGREES 45 MINUTES 24
SECONDS WEST ALONG A SOUTH LINE OF SAID OUTLOT 1 A DISTANCE OF 140.00 FEET TO
THE POINT OF BEGINNING; THENCE CONTINUING ALONG SAID SOUTH LINE OF SAID OUTLOT
1 SOUTH 88 DEGREES 45 MINUTES 24 SECONDS WEST 535.81 FEET; THENCE NORTH 88
DEGREES 45 MINUTES 09 SECONDS WEST ALONG A SOUTHERLY LINE OF SAID OUTLOT 1 A
DISTANCE OF 147.11 FEET; THENCE NORTH 1 DEGREES 14 MINUTES 36 SECONDS WEST
39.00 FRET; THENCE NORTH 46 DEGREES 14 MINUTES 36 SECONDS WEST 358.59 FEET;
THENCE SOUTH 88 DEGREES 45 MINUTES 24 SECONDS WEST 20.65 FEET TO A POINT ON THE
WESTERLY LINE OF SAID OUTLOT 1; THENCE NORTHERLY ALONG SAID WESTERLY LINE, SAID
LINE BEING A CURVE, CONCAVE TO THE EAST, HAVING A RADIUS OF 950.00 FEET, AN ARC
DISTANCE OF 252.72 FEET, THE CHORD OF SAID ARC HAVING A LENGTH OF 251.98 FEET
AND A BEARING OF NORTH 11 DEGREES 13 MINUTES 02 SECONDS EAST; THENCE NORTH 88
DEGREES 45 MINUTES 24 SECONDS EAST 727.03 FEET; THENCE NORTH 1 DEGREES 14
MINUTES 36 SECONDS WEST 10.00 FEET; THENCE NORTH 88 DEGREES 45 MINUTES 24
SECONDS EAST 210.00 FEET TO THE WESTERLY LINE OF LOT 1 IN THE FIRST
RESUBDIVISION OF OUTLOT 1 IN NEW CENTURY TOWN UNIT ONE, BEING A SUBDIVISION OF
PARTS OF SECTIONS 32 AND 33, TOWNSHIP 44 NORTH, RANGE 11, EAST OF THE THIRD
PRINCIPAL MERIDIAN, RECORDED DECEMBER 3, 1976, AS DOCUMENT 1807715; THENCE
SOUTHELRY ALONG SAID WEST LINE OF LOT 1, SAID LINE BEING A CURVE, CONCAVE TO
THE EAST, HAVING A RADIUS OF 150.00 FEET, AN ARC DISTANCE OF 16.28 FEET TO THE
SOUTH WEST CORNER OF SAID LOT 1, THE CHORD OF SAID ARC HAVING A LENGTH OF 16.27
FEET, AND A BEARING OF SOUTH 9 DEGREES 07 MINUTES 19 SECONDS WEST; THENCE NORTH
88 DEGREES 45 MINUTES 24 SECONDS EAST ALONG A SOUTH LINE OF SAID XXX 0, X
XXXXXXXX XX 00.00 XXXX; THENCE SOUTHERLY ALONG A CURVE, CONCAVE TO THE EAST
HAVING A RADIUS OF 136.50 FEET, AN ARC DISTANCE OF 19.02 FEET TO A POINT OF
TANGENCY, THE CHORD OF SAID ARC HAVING A LENGTH OF 19.00 FEET AND A BEARING OF
SOUTH 2 DEGREES 44 MINUTES 53 SECONDS WEST; THENCE SOUTH 1 DEGREES 14 MINUTES
36 SECONDS EAST 38.99 FEET TO A POINT OF CURVATURE; THENCE SOUTHERLY ALONG A
CURVE CONCAVE TO THE EAST HAVING A RADIUS OF 241.50 FEET, AN ARC DISTANCE OF
97.05 FEET TO A POINT OF COMPOUND CURVATURE, THE CHORD OF SAID ARC HAVING A
LENGTH OF 96.40 FEET AND A BEARING OF SOUTH 12 DEGREES 45 MINUTES 20 SECONDS
EAST; THENCE SOUTHEASTERLY ALONG A CURVE, CONCAVE TO THE NORTH EAST, HAVING A
RADIUS OF 25.00 FEET, AN ARC DISTANCE OF 34.54 FEET TO A POINT OF REVERSED
CURVATURE THE CHORD OF SAID ARC HAVING A LENGTH OF 31.86 FEET AND A BEARING OF
SOUTH 63 DEGREES 51 MINUTES 09 SECONDS EAST; THENCE EASTERLY ALONG A CURVE,
CONCAVE TO THE SOUTH, HAVING A RADIUS OF 182.33 FEET AN ARC DISTANCE OF 38.81
FEET TO A POINT OF TANGENCY, THE CHORD OF SAID ARC HAVING A LENGTH OF 38.73
FEET AND A BEARING OF NORTH 82 DEGREES 39 MINUTES 13 SECONDS EAST; THENCE NORTH
88 DEGREES 45 MINUTES 24 SECONDS EAST 61.21 FEET TO A POINT OF CURVATURE;
THENCE EASTERLY ALONG A CURVE, CONCAVE TO THE SOUTH, HAVING A
30
EXHIBIT A CONT.
RADIUS OF 167.00 FEET, AN ARC DISTANCE OF 18.95 FEET TO A POINT OF REVERSED
CURVATURE, THE CHORD OF SAID ARC HAVING A LENGTH OF 18.94 FEET AND A BEARING
OF SOUTH 87 DEGREES 59 MINUTES 36 SECONDS EAST; THENCE EASTERLY ALONG A CURVE,
CONCAVE TO THE NORTH, HAVING A RADIUS OF 120.00 FEET, AN ARC DISTANCE OF 25.80
FEET TO THE EASTERLY LINE OF SAID OUTLOT 1, THE CHORD OF SAID ARC HAVING A
LENGTH OF 25.75 FEET AND A BEARING OF NORTH 89 DEGREES 05 MINUTES 48 SECONDS
EAST; THENCE SOUTH 32 DEGREES 43 MINUTES 31 SECONDS WEST ALONG SAID EASTERLY
LINE OF OUTLOT 1, A DISTANCE OF 23.12 FEET; THENCE WESTERLY ALONG A CURVE,
CONCAVE TO THE SOUTH HAVING A RADIUS OF 150.00 FEET, AN ARC DISTANCE OF 31.98
FEET TO A POINT OF TANGENCY, THE CHORD OF SAID ARC HAVING A LENGTH OF 31.92
FEET AND A BEARING OF NORTH 85 DEGREES 08 MINUTES 05 SECONDS WEST; THENCE SOUTH
88 DEGREES 45 MINUTES 24 SECONDS WEST 61.21 FEET TO A POINT OF CURVATURE;
THENCE SOUTHWESTERLY ALONG A CURVE CONCAVE TO THE SOUTH EAST, HAVING A RADIUS
OF 165.33 FEET, AN ARC DISTANCE OF 144.28 FEET, THE CHORD OF SAID ARC HAVING A
LENGTH OF 139.75 FEET, AND A BEARING OF SOUTH 63 DEGREES 45 MINUTES 24 SECONDS
WEST; THENCE SOUTH 0 DEGREES 38 MINUTES 22 SECONDS EAST 300.00 FEET TO THE
POINT OF BEGINNING, IN LAKE COUNTY, ILLINOIS.
31
EXHIBIT B
INTENTIONALLY DELETED
32
EXHIBIT C
INTENTIONALLY DELETED
33
EXHIBIT D
XXXX OF SALE
KNOW ALL MEN BY THESE PRESENTS, that Endowment and Foundation Realty
Partnership -- JMB-I, an Illinois limited partnership ("Seller") in
consideration of Ten and 00/100 Dollars ($10.00), the receipt and sufficiency
of which is hereby acknowledged, does hereby sell, assign, transfer, quit claim
and set over unto Inland Monthly Income Fund III, Inc., a Maryland corporation
("Purchasers) all furniture, furnishings, fixtures, equipment and other
personal property set forth on Exhibit A attached hereto and made a part hereof
(the "Personal Property") located at, on and about the real estate commonly
known as Hawthorn Village Commons and legally described on Exhibit B attached
hereto and made a part hereof (the "Premises").
TO HAVE AND TO HOLD the Personal Property unto Purchaser and
Purchaser's heirs, legal representatives, successors and assigns forever.
ALL WARRANTIES OF QUALITY OR FITNESS FOR A PARTICULAR PURPOSE AND
MERCHANTABILITY ARE EXPRESSLY EXCLUDED. THE PERSONAL PROPERTY SOLD HEREUNDER
IS SOLD IN "AS IS" CONDITION WITHOUT ANY REPRESENTATION OR WARRANTY BY SELLER.
IN WITNESS WHEREOF, Seller has signed this Xxxx of Sale at Chicago,
Illinois this ________ day of _______, 1996.
ENDOWMENT AND FOUNDATION REALTY PARTNERSHIP -- JMB I, an Illinois
limited partnership
By: JMB Institutional Realty Corporation,
an Illinois corporation,
Corporate General Xxxxxx
By: Heitman Capital Management Corporation, an Illinois
corporation, Investment Advisor
By:_______________________________________
Its:______________________________________
34
EXHIBIT A
(XXXX OF SALE)
LIST OF PERSONAL PROPERTY
35
EXHIBIT B
(TO XXXX OF SALE)
LEGAL DESCRIPTION
36
EXHIBIT E
ASSIGNMENT AND ASSUMPTION OF LEASES
FOR AND IN CONSIDERATION of the sum of Ten Dollars ($10.00) and for
other good and valuable consideration, the receipt and sufficiency which are
hereby acknowledged, LaSalle National Trust, N.A., successor to LaSalle
National Bank, as Trustee under a Trust Agreement dated May 31, 1983 and known
as Trust No. 106520, having its principal office c/x Xxxxxxx Capital Management
Corporation, 000 Xxxxx XxXxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000 ("Assignor"),
hereby sells, transfers, assigns and sets over unto Inland Monthly Income Fund
III, Inc., a Maryland corporation, 0000 Xxxxxxxxxxx Xxxx, Xxx Xxxxx, Xxxxxxxx
00000 ("Assignee"), its legal representatives, successors and assigns all of
Assignor's right, title and interest in, to and under (a) those certain leases
referred to on Exhibit A attached hereto and made a part hereof (the "Leases")
affecting the real estate legally described on Exhibit B attached hereto and
made a part hereof and commonly known as Xxxxxxxx Xxxxxxx Xxxxxxx, Xxxxxx
Xxxxx, Xxxxxxxx (the "Property") and (b) the rent therein referred except,
however, that portion of said rent attributable to periods of time prior to the
Closing Date (as defined in that certain Agreement of Purchase and Sale by and
between Assignor and Assignee, dated as of July _____, 1996) and any other rent
reserved to Assignor or its beneficiary pursuant to the provisions of said
Agreement of Purchase and Sale, including, without limitation, Section 5
thereof.
Assignee does hereby accept the foregoing Assignment and Assumption of
Leases subject to the terms and conditions herein and in the Leases, and does
hereby assume, as of the date hereof, and become responsible for and agree to
perform, discharge, fulfill and observe all of the obligations, terms,
covenants, provisions and conditions under the Leases arising from and after
the Closing Date, and Assignee agrees to be liable for the observance and
performance thereof as fully as though Assignee was the original landlord or
lessor thereunder. Assignee agrees to protect, defend, indemnify and hold
harmless Assignor and its beneficiary and their respective legal
representatives, successors and assigns from any and all losses, damages,
expenses, fees (including without limitation reasonable attorneys' fees), court
Costs, suits, judgments, liability, claims and demands whatsoever in law or in
equity, incurred or suffered by Assignor or its beneficiary or their respective
legal representatives, successors and assigns or any of them arising out of or
in connection with the Leases as to events occurring from and after the Closing
Date. Assignor agrees to protect, defend, indemnify and hold harmless
Assignee, its legal representatives, successors and assigns from any and all
losses, damages, expenses, fees (including, without limitation, reasonable
attorneys' fees), court costs, suits, judgments, liability, claims and demands
whatsoever in law or in equity, incurred or suffered by Assignee, its legal
representatives, successors and assigns or any of them arising out of or in
connection with the Leases as to events occurring prior to the Closing Date,
provided that any claim made by Purchaser hereunder shall be deemed waived
unless Purchaser has given Seller written notice of such claim prior to the
date which is one year after the Closing Date.
Notwithstanding anything to the contrary contained in this Assignment
and Assumption of Leases, it is expressly understood and agreed by and between
the parties hereto that the recourse of Assignee or its successors or assigns
against Assignor or of Assignor against Assignee with respect to indemnity
obligations provided above shall extend only to Assignor's or Assignee's
interest in the Property (which shall include the net proceeds received by
Assignor
37
as a result of the Closing of the sale of the Property to Assignee and any
insurance proceeds or condemnation proceeds received by Assignor) and not to
any other assets of Assignor or its beneficiary or Assignee or any of the other
persons or entities referred to below. No personal liability or personal
responsibility of any sort with respect to the indemnity obligations of
Assignor above is assumed by, or shall at any time be asserted or enforceable
against, Assignor or Heitman Capital Management Corporation, or against any of
their respective shareholders, directors, officers, employees, agents,
constituent partners, beneficiaries, trustees or representatives, except to the
extent of their interest in the Property (or in the net proceeds from the sale
thereof and any insurance proceeds or condemnation proceeds received Assignor).
This Assignment and Assumption of Leases shall be binding upon and shall inure
to the benefit of Assignor and Assignee and their respective beneficiaries,
legal representatives, heirs, successors and assigns, subject, however, to any
limitations on assignment set forth in the aforesaid Agreement of Purchase and
Sale.
This Assignment and Assumption of Leases may be executed in
counterparts, and as so executed shall constitute one and the same agreement.
Notwithstanding anything contained herein to the contrary, LaSalle
National Trust, N.A. is executing this Assignment solely in its capacity as
Trustee, as aforesaid, and said Trustee shall have no personal liability or
responsibility for the performance or observance of any of the covenants,
agreements, representations, warranties or other duties or obligations of the
Seller hereunder, all such personal liability and responsibility being
expressly waived.
IN WITNESS WHEREOF, the parties hereto have executed this Assignment
and Assumption of Leases this _____ day of ___________, 1996.
ASSIGNOR:
LASALLE NATIONAL TRUST, N.A.,
not personally but as Trustee as aforesaid
By:
----------------------------------------
Its:
---------------------------------------
ASSIGNEE:
INLAND MONTHLY INCOME FUND III, INC.,
a Maryland corporation
By:
----------------------------------------
Its:
---------------------------------------
38
EXHIBIT A
(TO ASSIGNMENT AND ASSUMPTION OF LEASES)
LIST OF LEASES
39
EXHIBIT B
(TO ASSIGNMENT AND ASSUMPTION OF LEASES)
LEGAL DESCRIPTION
40
EXHIBIT F
ASSIGNMENT AND ASSUMPTION OF CONTRACTS, LICENSES AND PERMITS
FOR AND IN CONSIDERATION of the sum of Ten Dollars ($10.00) and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, Endowment and Foundation Realty Partnership -- JMB-I, an
Illinois limited partnership, having its principal office c/x Xxxxxxx Capital
Management Corporation, 000 Xxxxx XxXxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000
("Assignor"), hereby sells, transfers, assigns and sets over unto Inland Monthly
Income Fund III, Inc., a Maryland corporation, 0000 Xxxxxxxxxxx Xxxx, Xxx Xxxxx,
Xxxxxxxx 00000 ("Assignee"), its legal representatives, successors and assigns
effective as of the Closing Date (as defined in that certain Agreement of
Purchase and Sale by and between Assignor and Assignee, dated as of July ____,
1996) all of Assignor's right, title and interest in, to and under (a) those
certain service, construction, development, maintenance, operation and
management agreements, utility contracts and other agreements referred to on
Exhibit A attached hereto and made a part hereof (the "Contracts") affecting the
real estate legally described on Exhibit B attached hereto and made a part
hereof and commonly known as Xxxxxxxx Xxxxxxx Xxxxxxx, Xxxxxx Xxxxx, Xxxxxxxx
(the "Property") and (b) all licenses and permits relating to the construction,
use and operation of the Property.
Assignee does hereby accept the foregoing Assignment and Assumption of
Contracts, Licenses and Permits and does hereby assume, as of the Closing Date,
and become responsible for and agree to perform, discharge, fulfill and observe
all of the obligations, terms, covenants, provisions and conditions under the
Contracts arising from and after the date hereof, and Assignee agrees to be
liable for the observance and performance thereof as fully as though Assignee
was the original party thereunder. Assignee agrees to protect, defend,
indemnify and hold harmless Assignor, its legal representatives, successors and
assigns from any and all losses, damages, expenses, fees (including without
limitation reasonable attorneys' fees), court costs, suits, judgments,
liability, claims and demands whatsoever in law or in equity, incurred or
suffered by Assignor, its legal representatives, successors and assigns or any
of them arising out of or in connection with the Contracts, as to events
occurring from and after the Closing Date. Assignor agrees to protect, defend,
indemnify and hold harmless Assignee, its legal representatives, successors and
assigns from any and all losses, damages, expenses, fees (including, without
limitation, reasonable attorneys' fees), court costs, suits, judgments,
liability, claims and demands whatsoever in law or in equity, incurred or
suffered by Assignee, its legal representatives, successors and assigns or any
of them arising out of or in connection with the Contracts, as to events
occurring prior to the Closing Date, provided that any claim made by Purchaser
hereunder shall be deemed waived unless Purchaser has given Seller written
notice of such claim prior to the date which is six months after the Closing
Date.
Notwithstanding anything to the contrary contained in this Assignment
and Assumption of Contracts, Licenses and Permits, it is expressly understood
and agreed by and between the parties hereto that the recourse of Assignee or
its successors or assigns against Assignor or of Assignor against Assignee with
respect to indemnity obligations provided above shall extend only
41
to Assignor's or Assignee's interest in the Property (which shall include the
net proceeds received by Assignor as a result of the Closing of the sale of the
Property to Assignee and any insurance proceeds or condemnation proceeds
received by Assignor) and not to any other assets of Assignor or its partners
or Assignee or any of the other persons or entities referred to below. No
personal liability or personal responsibility of any sort with respect to the
indemnity obligations of Assignor above is assumed by, or shall at any time be
asserted or enforceable against, Assignor or Heitman Capital Management
Corporation, or against any of their respective shareholders, directors,
officers, employees, agents, constituent partners, beneficiaries, trustees or
representatives, except to the extent of their interest in the Property (or in
the net proceeds from the sale thereof and any insurance proceeds or
condemnation proceeds received by Assignor).
This Assignment and Assumption of Contracts, Licenses and Permits
shall be binding upon and shall inure to the benefit of Assignor and Assignee
and their respective beneficiaries, legal representatives, heirs, successors
and assigns, subject, however, to any limitations on assignment set forth in
the aforesaid Agreement of Purchase and Sale.
This Assignment and Assumption of Contracts, Licenses and Permits may
be executed in counterparts, and as so executed shall constitute one and the
same agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Assignment
and Assumption of Contracts, Licenses and Permits this _______ day of _______,
1996.
ASSIGNOR:
ENDOWMENT AND FOUNDATION REALTY PARTNERSHIP -- JMB I,
an Illinois limited partnership
By: JMB Institutional Realty Corporation,
an Illinois corporation,
Corporate General Partner
By: Heitman Capital Management Corporation,
an Illinois corporation,
Investment Advisor
By:
---------------------------------------
Its:
--------------------------------------
42
ASSIGNEE:
INLAND MONTHLY INCOME FUND III, INC.,
a Maryland corporation
By:
---------------------------------------
Its:
--------------------------------------
43
EXHIBIT A
(TO ASSIGNMENT AND ASSUMPTION OF CONTRACTS,
LICENSES AND PERMITS)
LIST OF CONTRACTS
44
EXHIBIT B
(TO ASSIGNMENT AND ASSUMPTION OF CONTRACTS,
LICENSES AND PERMITS)
LEGAL DESCRIPTION
45
EXHIBIT G
FORM OF TENANT ESTOPPEL CERTIFICATE
Date: ____________________________, 1996
To: Inland Monthly Income Fund III, Inc.
Re: TENANT:______________________________________
PREMISES: Suite _______, Xxxxxxxx Xxxxxxx Xxxxxxx, Xxxxxx Xxxxx,
Xxxxxxxx
The Undersigned Tenant hereby confirms, as of the date hereof
the following:
1. Tenant is the current tenant under a Lease dated
__________________________ wherein LaSalle National Trust,
N.A. of Chicago, Illinois, not individually but as Trustee
under Trust Agreement dated May 31, 1983 known as Trust No.
106520 ("Landlord") is the current Landlord. Said Lease
together with the following amendments or modifications:
[INSERT DESCRIPTION OF LEASE AMENDMENTS, IF APPLICABLE]
constitutes the entire agreement between Landlord and Tenant
with respect to the premises demised thereby (the "Premises").
The Lease, as so amended (if applicable), is hereby referred
to as the "Lease."
2. The Lease is in full force and effect. Landlord is not in
default under the Lease.
3. Tenant has accepted possession of the Premises, and any
improvements required by the terms of the Lease to be made by
Landlord have been substantially completed to the satisfaction
of Tenant.
4. The presently existing term of the Lease expires on
_____________________ and Tenant has the following options to
extend:
[INSERT DESCRIPTION OF OPTIONS TO EXTEND, IF APPLICABLE]
5. The obligation of Tenant to pay rent under the lease has
commenced. No rent payable under the Lease has been paid more
than one (1) month in advance of its due date. Tenant is not
entitled to any rent credit, concession, free rent period or
other concession under the Lease except as follows:
[INSERT DESCRIPTION OF CONCESSIONS, IF APPLICABLE]
6. No charge, lien, or claim of offset has accrued to Tenant
under the Lease or otherwise against rents or other charges
due or to become due thereunder.
7. Landlord holds no security deposit under the Lease.
[NAME OF TENANT]
By:
---------------------------------------
Title:
------------------------------------
46
EXHIBIT G-1
FORM OF SELLER ESTOPPEL CERTIFICATE
Date: _________________________, 1996
To: Inland Monthly Income Fund III, Inc.
Re: "TENANT":
"LANDLORD": LaSalle National Trust, N.A. of Chicago, Illinois,
not individually but as Trustee under Trust Agreement
dated May 31, 1983 known as Trust Xx. 000000
"PREMISES": Suite ______, Xxxxxxxx Xxxxxxx Xxxxxxx, Xxxxxx Xxxxx,
Xxxxxxxx
Pursuant to the terms of Section 3.4 of that certain Agreement of
Purchase and Sale dated as of July __, 1996 (the "Agreement"), between Landlord,
the undersigned and Inland Monthly Income Fund III, Inc., a Maryland
corporation ("Purchaser"), the undersigned hereby represents to Purchaser that,
to the best knowledge of the undersigned, as of the date hereof:
1. Tenant is the tenant under a Lease dated _____________________
with Landlord. Said Lease together with the following
amendments or modifications:
[INSERT DESCRIPTION OF LEASE AMENDMENTS, IF APPLICABLE]
constitutes the entire agreement between Landlord and Tenant
with respect to the Premises. The Lease, as so amended (if
applicable), is hereby referred to as the "Lease".
2. The Lease is in full force and effect. Landlord is not in
default under the Lease.
3. Tenant has accepted possession of the Premises, and any
improvements required by the terms of the Lease to be made by
Landlord have been substantially completed to the satisfaction
of Tenant.
4. The presently existing term of the Lease expires on __________
and Tenant has the following options to extend:
[INSERT DESCRIPTION OF OPTIONS TO EXTEND, IF APPLICABLE]
5. The obligation of Tenant to pay rent under the Lease has
commenced. No rent payable under the Lease has been paid more
than one month in advance of its
47
due date. Tenant is not entitled to any rent credit,
concession, free rent period or other concession under the
Lease except as follows:
[INSERT DESCRIPTION OF CONCESSIONS, IF APPLICABLE]
6. No charge, lien, or claim of offset has accrued to Tenant
under the Lease or otherwise against rents or other charges
due or to become due thereunder.
7. Landlord holds no security deposit under the Lease.
The representations set forth in this Certificate shall be, and shall
be deemed to be, representation made under the Agreement and subject to all of
the conditions and limitations applicable to the other representations in the
Agreement, including, without limitation, those set forth in the last three
grammatical paragraphs of Section 6 of the Agreement.
ENDOWMENT AND FOUNDATION REALTY
PARTNERSHIP - JMB I, an Illinois limited partnership
By: JMB Institutional Realty Corporation,
an Illinois corporation, Corporate
General Partner
By: Heitman Capital Management
Corporation, an Illinois
corporation, Investment
Advisor
By:
----------------------
Title:
-------------------
48
EXHIBIT H
Form of Escrow Agreement
NEAR NORTH NATIONAL TITLE CORPORATION
A MEMBER OF THE NEAR NORTH NATIONAL GROUP
000 X. XxXxxxx Xxxxxx Phone: (000)000-0000
Chicago, Illinois Fax: (000)000-0000
Escrow No.:_______________________
Date:_____________________________
STRICT JOINT ORDER ESCROW
The accompanying One Hundred Thousand Dollars ($100,000) is deposited with Near
North Title Corporation as Escrowee to be delivered by it only upon the joint
order of the undersigned or their respective legal representatives or assigns.
Near North National Title Corporation, as Escrowee, is hereby expressly
authorized to disregard, in its sole discretion, any and all notices or
warnings given by any of the parties hereto, or by any other person or
corporation, but the said Escrowee is hereby expressly authorized to regard and
to comply with and obey any and all orders, judgments or decrees entered or
issued by any court with or without jurisdiction, and in case the said Escrowee
obeys or complies with any such order, judgment or decrees of any court it
shall not be liable to any of the parties hereto or any other person, firm or
corporation by reason of such compliance, notwithstanding any such order,
judgment or decree being entered without jurisdiction or being subsequently
reversed, modified, annulled, set aside or vacated. In case of any suit or
proceeding regarding this escrow, to which said Escrowee is or may at any time
become a party, it shall have a lien on the contents hereof for any and all
costs, attorneys' and solicitors' fees, whether such attorneys or solicitors
shall be regularly retained or specially employed, and any other expenses which
it may have incurred or become liable for on account thereof, and it shall be
entitled to reimburse itself therefor out of said deposit, and the undersigned
jointly and severally agree to pay said Escrowee upon demand all such costs,
fees and expenses so incurred.
In no case shall the above mentioned deposits be surrendered except on an order
signed by the parties hereto, their respective legal representatives or
assigns, or in obedience of the process or order of court as aforesaid.
Deposits made pursuant to these instructions may be invested on behalf of any
party or parties thereto: Provided, that any direction to Escrowee for such
investment shall be expressed in writing and contain the consent of all the
parties to this escrow, and also provided that Escrowee is in receipt of the
taxpayer's identification number and investment forms as required. Escrowee
will, upon request, furnish information concerning its procedures and fee
schedules for investment.
49
Except as to deposits of funds for which Escrowee has received express written
direction concerning investment or other handling, the parties hereto agree
that the Escrowee shall be under no duty to invest or reinvest any deposits at
any time held by it hereunder; and further, that Escrowee may commingle such
deposits with other deposits or with its own funds in the manner provided for
the administration of funds under Section 3 of the Illinois Banking and Finance
Act (c. 17. par 1555 III. Rev. Stat.) and may use any part or all such
funds for its own benefit without obligation to any party for interest derived
thereby, if any. Provided, however, nothing herein shall diminish Escrowee's
obligation to apply the full amount of the deposits, plus all interest and
earnings thereon, in accordance with the terms of this Agreement.
In the event the Escrowee is requested to invest deposits hereunder, Near North
National Title Corporation is not to be held responsible for any loss of
principal or interest which may be incurred as a result of making the
investment for the purposes of these escrow instructions, unless such loss
results from the negligence or intentional misconduct of Escrowee.
The undersigned acknowledge that the amount deposited hereunder is the Xxxxxxx
Money described in and governed by that certain Agreement of Purchase and Sale
dated July _____, 1996 between the undersigned. The undersigned agree to
execute all joint directions and take all other actions required hereunder to
cause the Xxxxxxx Money to be disbursed and applied in the manner required
under said Agreement of Purchase and Sale.
PURCHASER:
INLAND MONTHLY INCOME FUND III, INC., a Maryland corporation
Signed By:
--------------------------------
Name:
-------------------------------------
Its:
--------------------------------------
Address: 0000 Xxxxxxxxxxx Xxxx
Xxx Xxxxx, Xxxxxxxx 00000
Attn:
--------------------
SELLER:
ENDOWMENT AND FOUNDATION REALTY PARTNERSHIP -- JMB-I, an Illinois
limited partnership
Signed By:
--------------------------------
Name:
-------------------------------------
Its:
--------------------------------------
Address: c/x Xxxxxxx Capital Management Corporation
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attn: Xx. Xxxxxx Xxxxxxx
50
ACCEPTED:
Near North National Title Corporation, Escrowee
BY:
---------------------------------------
Name:
-------------------------------------
Its:
--------------------------------------
51
EXHIBIT I
Form of Tenant Notification Letter
_____________, 1996
VIA CERTIFIED MAIL - RETURN RECEIPT REQUESTED
[Tenant]
RE: HAWTHORN VILLAGE COMMONS
Dear [Tenant]:
You are hereby advised that the above referenced property in which you are a
tenant was sold and your lease was assigned and transferred effective as of the
date of this letter to [PURCHASER]. Your security deposit and advance rental,
if any, has been transferred to the new owner, whose address is set forth
below. The above referenced property will be managed by [MANAGEMENT COMPANY]
and all checks for rent and other charges should be made payable to [PURCHASER
ENTITY] and forwarded to:
[MANAGEMENT COMPANY]
[Property Address]
In accordance with the terms of your lease, copies of all future notices to
landlord should be sent to:
[PURCHASER ENTITY]
If you have any questions or need any additional information, please feel free
to contact the management office at [Telephone Number].
Sincerely,
SELLER:
By:
---------------------------------------
Name:
-------------------------------------
Its:
--------------------------------------
52
EXHIBIT J
Form of Vendor Notification Letter
_________________, 199
VIA CERTIFIED MAIL - RETURN RECEIPT REQUESTED
[Vendor]
RE: HAWTHORN VILLAGE COMMONS
Gentlemen:
This is to advise you that the above referenced property was sold to [Purchaser
Entity]. As part of the sale, your contract has been assigned to [Purchaser
Entity], and any goods, services or utilities supplied to the property
subsequent to the date of this letter shall be for its account. The above
referenced property will be managed by [Management Company] and all future
invoices and correspondence should be sent to:
[Management Company]
Any and all notices to Purchaser, should be sent to the above address.
SELLER:
By: _______________________________________
Its: ______________________________________
53
EXHIBIT K
FIRPTA CERTIFICATION BY ENTITY TRANSFEROR
Section 1445 of the Internal Revenue Code provides that a transferee
of a U.S. real property interest must withhold tax if the transferor is a
foreign person. To inform the transferee that withholding of tax is not
required upon the disposition of a U.S. real property interest by ENDOWMENT
AND FOUNDATION REALTY PARTNERSHIP -- JMB-I, an Illinois limited partnership
("Seller"), the undersigned hereby represents, warrants and certifies the
following to INLAND MONTHLY INCOME FUND III, INC., a Maryland corporation
("Transferee"):
Seller is not a foreign corporation, foreign partnership, foreign
trust, or foreign estate (as those terms are defined in the Internal
Revenue Code and Income Tax Regulations); and
Seller's Federal Employer Identification Number is
_______________________.
The office address of Seller is: c/x Xxxxxxx Capital Management
Corporation, 000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx
00000.
The undersigned understands that this certification may be disclosed
to the Internal Revenue Service by Transferee and that any false statement
contained herein could be punished by fine, imprisonment or both.
Under penalties of perjury, the undersigned individual, executing this
document on behalf of Seller, declares that he/she has examined this
certification and to the best of his/her knowledge and belief it is true,
correct and complete, and further declares that he/she has authority to sign
this document on behalf of Seller.
Dated: ________________, 1996.
ENDOWMENT AND FOUNDATION REALTY
PARTNERSHIP - JMB I, an Illinois limited partnership
By: JMB Institutional Realty Corporation, an
Illinois corporation, Corporate General
Partner
By: Heitman Capital Management Corporation,
an Illinois corporation, Investment
Advisor
By:
---------------------------------------
Title:
------------------------------------
54
EXHIBIT L
Copy of Letter of Title Objections
55
[LETTERHEAD]
INLAND
The Inland Group, Inc
0000 Xxxxxxxxxxx Xxxx
Xxx Xxxxx, Xxxxxxxx 00000
000-000 0000
July 19, 1996
Endowment and Foundation Realty
Partnership-JMB-I
c/x Xxxxxxx Capital Management Corporation
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx #0000
Xxxxxxx, Xxxxxxxx 00000-0000
ATTN: Xxxxxx X. Xxxxxxx
RE: Xxxxxxxx Xxxxxxx Xxxxxxx
Xxxxx Xxxxx, Xxxxxxxx
Gentlemen:
This letter constitutes the letter from Inland Monthly Income Fund III, Inc to
you which is referred to in paragraph 3.3 of the Agreement of Purchase and Sale
(the "Contract") for the above referenced property. We have examined that
certain Commitment for Title Insurance issued by First American Title Insurance
Company bearing number N9601096 with an effective date of April 17, 1996 (the
"Commitment") as well as that certain ALTA/ACSM Land Title Survey of Xxxxxx and
Associates, Inc. dated July 12, 1996 and bearing order no. 93-058A (the
"Survey"), and the following are our objections:
The Commitment
1. The Effective Date of the Commitment should be updated prior to
closing.
2. The amount of the Owner's Policy should be increased to the Purchase
Price, i.e. $8,530,000.
3. The Proposed Insured for the Owner's Policy should reflect to the
following land trustee: American National Bank and Trust Company of
Chicago as Trustee under Trust Agreement dated July 17, 1996 and known
as Trust No. 121894-03.
4. The Commitment should be revised (in Schedule A, No. 3) to reflect
that there is no mortgage to be insured.
5. A portion of the property included within the legal description of
Parcel 2 in Schedule A, No. 4 is already included within the legal
description of Parcel 1. Also, the drawing of Parcel 2 on the Survey
includes an area that is not within the legal description of Parcel 2.
This situation needs clarification and/or explanation, and possibly an
amendment to the
EVERYTHING IN REAL ESTATE BUT HOUSES
56
Endowment and Foundation Realty
c/x Xxxxxxx Capital Management Corporation
July 19, 1996
Page -2-
Declaration of Easement recorded as document #1926486. The first step
towards explanation would be to provide a COMPLETE copy of document
#1926486, INCLUDING Exhibits B and E thereto. Most likely the legal
description of Parcel 2 of the Commitment needs to be revised.
6. Schedule B No. 1(A) should be amended to reflect that the first
installment of real estate taxes has been paid.
7. Schedule B No. 4(D) should be reworded to identify which Plat of
Subdivision is being referred to (currently the exception reads "the
Plat of said Subdivision" without any prior reference to a
subdivision). I believe it is the First Resubdivision of Outlot 1,
and if that is the case, this exception should either be qualified to
reflect that it affects ONLY Parcel 2, or it should be eliminated
altogether.
8. Schedule B No. 5(E) should be deleted, since the letter referred to
therein was superceded by the letter referred to in No. 20(T).
9. Schedule B No. 8(H) should end with a period after the words "creating
said easements". The words "and in documents 1929822 and 1949100
assigning said easements described as Parcels 2 and 3." should be
deleted. A careful review of documents 1929822 and 1949100 discloses
that these easement grants do not have any terms, provisions or
conditions, but rather merely grant the owner of a leasehold estate
the same easements as were already created by the documents identified
in Parcels 2 and 3 of the Commitment.
10. Schedule B No. 10(J) should be deleted, first of all because this
concept is already covered by No. 8(H), and secondly because document
1773409 does not provide for the imposition of any lien against the
property as a result of nonpayment of the costs for repair,
maintenance, etc.
11. Schedule B No. 11(K) should be deleted as it is already covered by No.
8(H).
12. Schedule B No. 14(N) should be qualified to reflect that it affects
Parcel 4 only.
13. Schedule B No. 15(O) should be deleted as this is the easement which
is insured as Parcel 4, and No. 8(H) is an exception for the terms,
provisions and conditions creating this easement.
14. Schedule B No. 23(W) should be amended to reflect only the specific
leases in effect at the property, which ought to be disclosed to the
title company through an ALTA Statement or by some other means.
15. Schedule B No. 24(X), 25(Y), 26(Z), 27(AA), 28(AB), 29(AC), 30(AD)
should be deleted.
57
Endowment and Foundation Realty
c/x Xxxxxxx Capital Management Corporation
July 19, 1996
Page -3-
16. The Commitment should include a commitment to issue a 3.1 zoning
endorsement and the other endorsements required by paragraph 3.3 of
the Contract.
The Survey
1. The Survey should include the following party in the certification:
American National Bank and Trust Company of Chicago as Trustee under
Trust Agreement dated July 17, 1996 and known as Trust No. 121894-03.
2. The Note that reference should be made to document #1773409 for Parcel
3 is not sufficient. There should be a drawing of Parcel 3. Perhaps
this could be done on a smaller scale, but the idea is to give an
orientation as to where the roadway is with respect to the Center.
3. The Survey should identify the zoning classification of the property.
4. The drawing of Parcel 2 does not correspond to the legal description
for Parcel 2. An explanation should be provided, or the drawing of
Parcel 2 revised. Also, see No. 5 under the Commitment above.
5. The drawing of Parcel 2 should locate the easement for public
utilities per the Plat of Resubdivision, document #1807715.
Very truly yours,
THE INLAND GROUP, INC.
/s/ XXXXXX X. XXXXXXXXX
-------------------------------
Xxxxxx X. Xxxxxxxxx
Senior Counsel
SAO/dmc
58
EXHIBIT M
Description of Traffic Signal Easement
59
THIS DOCUMENT WAS PREPARED BY AND
UPON RECORDING TO BE RETURNED TO:
XXXXXX X. XXXXX
WILDMAN, HARROLD, XXXXX & XXXXX
000 XXXX XXXXXX XXXXX
XXXXXXX, XXXXXXXX 00000
TRAFFIC SIGNAL
EASEMENT AGREEMENT
HAWTHORN VILLAGE COMMONS
THIS EASEMENT AGREEMENT ("Easement Agreement") is made as of
the_________ day of _________, 1996, by and between LASALLE NATIONAL TRUST,
N.A., as successor trustee to LaSalle National Bank, not individually but as
Trustee under that certain Trust Agreement dated ___________, 19_, and known as
Trust No. 106520 ("Grantor") and the VILLAGE OF XXXXXX HILLS, an Illinois
municipal corporation ("Village").
W I T N E S S E T H:
WHEREAS, Grantor is the record owner of a certain parcel of land,
which is legally described on Exhibit A-1 attached hereto and is shown as the
"Developer Property" on the Survey attached hereto as Exhibit "A".
60
WHEREAS, the Developer Property is part of Hawthorn Village Commons
Shopping Center (the "Shopping Center"). A portion of the Developer Property is
adjacent to the intersection of Hawthorn Parkway and Lakeview Parkway in the
Village.
WHEREAS, the Village intends to install a Traffic Control Signal
("Traffic Signal") at the intersection of Hawthorn Parkway and Lakeview Parkway
and desires an easement from Grantor to enter the Developer Property and
construct, maintain, replace, repair and renew traffic signal detector loops,
conduit, pavement, markings, traffic control signals and related facilities
(the "Traffic Facilities") on the Developer Property.
WHEREAS, Grantor wishes to grant, and the Village wishes to accept, a
non-exclusive easement, all as more fully set forth below.
NOW, THEREFORE, in consideration of the foregoing, the mutual
agreement of the parties hereto and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereby
agree as follows:
1. RECITALS. The recitals set forth above are hereby
incorporated by reference into and shall be a part of this Easement Agreement.
2. GRANT OF EASEMENTS. Grantor hereby grants to the Village a
perpetual easement (the "Easement") for the benefit of and appurtenant to
Hawthorn Parkway and Lakeview Parkway to enter the Developer Property and
utilize a portion of the Developer Property ("Easement Parcel") which Easement
Parcel is depicted on Exhibit B. to construct, maintain, operate, replace,
repair and renew the Traffic Facilities and for no other purpose. Except for
the Easement Parcel, no Easement is granted as to any part of the Shopping
Center.
3. OBLIGATIONS OF THE VILLAGE. Grantor hereby acknowledges that
ownership of, control of, and title to the Traffic Signal and Traffic
Facilities, together with the right to remove the same, is vested solely in the
Village, free and clear of all encumbrances or claims including claims for
payment by Grantor, its grantees, successors or assigns. The Easement herein
granted shall be non-exclusive and Grantor agrees not to build, construct or
erect any buildings or other structures on or within the Easement Parcel.
Grantor reserves the right to use the Developer Property for all purposes that
do not unreasonably interfere with the operation and enjoyment of the Easement
herein granted.
The cost of the construction, installation, maintenance, repair and
replacement of the Traffic Signal and Traffic Facilities, including without
limitation all costs and expenses of approvals and permits necessary from all
federal, state and local governmental departments and agencies, and all plans
and specifications for the Traffic Facilities shall be paid by the Village.
The construction of the Traffic Signal and Traffic Facilities shall be
performed in compliance with all applicable federal, state and local
ordinances, statutes, rules and regulations. In addition, all such work shall
be performed so as to cause the least interference possible (i) with
-2-
61
the continued use and operation of Hawthorn Parkway and Lakeview Parkway; and
(ii) with the conduct of business operations of the Shopping Center. The
Village shall indemnify, save and hold Grantor harmless from and against any
claim of loss or damage made by any third party arising out of the construction
of the Traffic Signal and Traffic Facilities by the Village, its contractors,
subcontractors, materialmen or suppliers.
4. EASEMENT ONLY. This Easement Agreement creates an Easement
only and the Village acknowledges that the Village does not and shall not claim
at any time any other interest or estate of any kind or extent whatsoever in
the Developer Property or the Shopping Center by virtue of this Easement.
5. TRANSFER BY GRANTOR. This Easement Agreement shall be binding
upon and inure to the benefit of the parties and their successors and assigns.
Grantor may at any time in its sole discretion assign its rights hereunder or
in connection with a transfer or conveyance of the Developer Property. Upon
any such assignment, transfer or conveyance, the liability of Grantor or its
successors and assigns under this Easement Agreement shall automatically
terminate, and the assignee, transferee or grantee shall be deemed to have
assumed and be bound by the obligations of such party under this Easement
Agreement.
6. DAMAGE CAUSED BY THE VILLAGE. The Village shall repair any
damage to the Developer Property or the Shopping Center caused by the Village.
Except for the Traffic Facilities, the Village shall not place any temporary or
permanent improvements or equipment upon the Developer Property or the Shopping
Center. If the Village fails to remove same, then Grantor may remove said
improvements, furnishings or equipment and the Village shall pay the cost of
any such removal, together with interest thereon at the rate set forth in
Paragraph 12 hereof from and after the date of such demand until receipt of
full payment therefor.
7. RESERVATION OF RIGHTS BY GRANTOR. The right to use the
Easement Parcel, and the right of ingress and egress over the Developer
Property, is expressly reserved by Grantor and its successors, grantees,
invitees and assigns. In addition, and not by limitation but by way of
example, Grantor and its successors, grantees, invitees and assigns, reserve
the right from time to time to grant additional ingress, egress and utility and
easements over, upon and under the Developer Property, provided that such
easements do not unreasonably interfere with the Village's use of the Easement
Parcel pursuant to the terms hereof.
8. CONDITION OF PREMISES; INDEMNITY. The Village acknowledges
that it (a) has physically inspected the Developer Property, and (b) accepts
its limited use of the Easement Parcel with full knowledge of the condition
thereof. The Village hereby agrees to indemnify, defend and hold harmless
Grantor from and against any and all liability, loss, claim, demand, lien,
damage, penalty, fine, interest, cost and expense (including, without
limitation, reasonable attorneys' fees and litigation costs) incurred by
Grantor for injuries to persons (including, without limitation, loss of life)
and for damage or destruction of property (including damage or destruction of
the Shopping Center or the Easement Parcel) which is directly or indirectly due
-3-
62
to the Village's use of the Easement and the Easement Parcel, except arising
out of Grantor's and Grantor's agents' and employees' gross negligence and
willful and wanton misconduct. The Village shall reasonably cooperate with
Grantor in the defense of any such claims, demands or action, including,
without limitation, the employment of legal counsel reasonably satisfactory to
Grantor.
9. NON-INTERFERENCE BY THE VILLAGE. The Village hereby agrees not
to interfere with the use of any existing license or easement on, under, above
or across either or both of the Shopping Center or the Developer Property,
provided the foregoing shall not prohibit the Village from utilizing the
Easement Parcel for the purpose specified by this Easement Agreement.
Furthermore, the Village hereby agrees not to unreasonably interfere with the
use of any license or easement hereafter granted on, under, above or across
either or both of the Shopping Center or the Developer Property, so long as
such easement or license, or the use thereof, does not materially interfere
with the Village's rights hereunder.
10. INSURANCE. The Village, at its sole cost and expense, shall
purchase and keep in full force and effect during the term of this Easement,
through an insurance company acceptable to Grantor (the Illinois Municipal
League Risk Management Association is acceptable to Grantor), commercial
general public liability insurance in an amount not less than Six Million and
No/100 Dollars ($6,000,000.00) per occurrence, whether involving bodily injury
(or death resulting therefrom) or property damage.
11. NO LIENS. The Village shall not permit any lien to be filed
against the Shopping Center or Developer Property or any portion thereof or any
improvements thereon for any labor or materials in connection with work of any
character performed or claimed to have been performed on the Shopping Center or
the Developer Property at the direction or sufferance of Easement.
In the event any such lien is filed against the Shopping Center or any
portion thereof or any improvements thereon, Grantor shall have the right, but
not the obligation, to cause such lien to be released and the Village shall pay
on demand all of Grantor's costs in connection therewith, together with
interest thereon at the interest rate set forth in Paragraph 13 hereof accruing
from and after the date of such demand until Grantor's receipt of full payment
therefor.
12. BREACH BY THE VILLAGE. If the Village breaches any provision
in this Easement Agreement and fails to cure any such breach within five (5)
days after written notice thereof, in addition to any other right or remedy
available at law or in equity, Grantor shall have the right to cure any such
breach and the Village agrees to reimburse Grantor for the cost thereof upon
demand, together with interest accruing thereon at an annual rate of interest
equal to the fluctuating Base Rate or Reference Rate (or prime rate or its
equivalent) of the First National Bank of Chicago (or its successor) from and
after the date of Grantor's demand therefor until Grantor's receipt of full
payment therefor.
-4-
63
13. NO WARRANTY; INTEGRATION. Grantor hereby makes and has made
no representations, statements, warranties or agreements to the Village in or
in connection with this Easement Agreement. This Easement Agreement embodies
the entire understanding of the parties hereto, and there are no further or
other agreements or understanding, written or oral, in effect between the
parties relating to the subject matter hereof.
14. NOTICES. Any notice, demand, request, consent or approval
which any party is required or desires to give or make hereunder shall be in
writing. A copy shall be provided for each of the parties hereto and the
original and all copies shall be sent by United States Registered Mail or
Certified Mail, Return Receipt Requested, postage pre-paid, and shall be deemed
delivered three (3) business days after deposit in the mail, or by private
overnight mail service for guaranteed next business day delivery (provided that
a return receipt is furnished), and shall be deemed delivered the next business
day after deposit with such service, addressed as follows:
In the case of Grantor:
LaSalle National Trust, N.A., as Trustee
under Trust No. 106520
c/o Urban Retail Properties Co.
000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: General Counsel
In the case of the Village:
------------------------------------------
------------------------------------------
------------------------------------------
------------------------------------------
------------------------------------------
or such other address as may be designated by written notice to the other
parties.
15. COUNTERPARTS. This Easement Agreement may be executed in
counterparts, each of which shall be deemed to be an original and all of which
shall together constitute one and the same instrument.
16. JURISDICTION. This Easement Agreement shall be interpreted in
accordance with the laws of the State of Illinois.
17. LAND TRUSTEE EXCULPATION. LaSalle National Trust has executed
this instrument, not individually, but solely as Trustee as aforesaid, in the
exercise of the power and authority
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64
conferred upon and vested in it by the aforesaid Trust Agreement, the power and
authority vested in the Trustee by the Deed in Trust of record by which LaSalle
National Trust took title to the Developer Property and every other power and
authority thereunto in enabling (and LaSalle National Trust hereby warrants
that it possesses full power and authority to execute this instrument). It is
expressly understood and agreed that nothing contained herein shall be construed
as creating any liability on LaSalle National Trust personally to perform any
covenants either express or implied contained in this Easement Agreement
(except the above covenant relating to the authority of the undersigned LaSalle
National Trust to execute this instrument as Trustee aforesaid), all such
liability, if any, being expressly waived by every person now or hereafter
claiming any right under this Easement Agreement, and that so far as LaSalle
National Trust is concerned, any party claiming any right under this Easement
Agreement, shall look solely to the Developer Property, and to rents, issues
and profits therefrom for the enforcement of any right created by this Easement
Agreement.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Easement Agreement as of the day and year first above written.
LA SALLE NATIONAL TRUST, N.A.,
as Trustee under Trust No. 106520
By:
---------------------------------------
Its:
-----------------------------
By:
---------------------------------------
Its:
-----------------------------
VILLAGE OF XXXXXX HILLS, an Illinois municipal
corporation
By:
---------------------------------------
Its:
-----------------------------
By:
---------------------------------------
Its:
-----------------------------
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65
STATE OF ILLINOIS )
) SS.
COUNTY OF XXXX )
I, the undersigned, a Notary Public, in and for said County, in the
State aforesaid, does hereby certify that _____________, ______________________
and ____________________, personally known to me to be the same persons whose
names are subscribed to the foregoing instrument as such _______________,
________________ and ______________ of LA SALLE NATIONAL TRUST, N.A., not
personally, but solely as Trustee under Trust No. 106520, appeared before me
and acknowledged that they signed and delivered the said instrument as their
own free and voluntary act and as the free and voluntary act of LaSalle National
Trust, N.A., as Trustee, for the uses and purposes therein set forth.
GIVEN under my hand and notarial seal this ___________ day of
___________________, 1996.
__________________________________________
Notary Public
My Commission Expires:
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66
STATE OF ILLINOIS )
) SS.
COUNTY OF XXXX )
I, the undersigned, a Notary Public, in and for said County, in the
State aforesaid, does hereby certify that _______________________
______________________ and ___________________________, personally known to me
to be the same persons whose names are subscribed to the foregoing instrument
as such __________________________________ and _______________________________
of the VILLAGE OF XXXXXX HILLS, an Illinois municipal corporation, appeared
before me and acknowledged that they signed and delivered the said instrument
as their own free and voluntary act and as the free and voluntary act of said
municipal corporation, for the uses and purposes therein set forth.
GIVEN under my hand and notarial seal this _________ day of
___________________, 1996.
__________________________________
Notary Public
My Commission Expires:
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67
EXHIBIT N
LIST OF APPROVED TENANT PROPOSALS
HAWTHORN VILLAGE COMMONS
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TENANT EXISTING/NEW PROPOSAL DATE
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Starbucks New 5/20/96 Tenant Commitment Report
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Norwest Financial Existing/Extension 6/25/96 Agreement to Extend Lease
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Paddock Publications (Daily Herald) Existing/Extension 6/27/96 Lease Amendment Form
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Page 1 of 1 7/16/96
68
SCHEDULE 1
LIST OF LEASES
HAWTHORN VILLAGE COMMONS
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DATE OF LEASE
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SUITE # TENANT NAME DBA DOCUMENTS COMMENTS
------------------------------------------------------------------------------------------------------------------------------------
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290 Dominick's Finer Foods, Inc. 12/28/77 Lease date
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10/3/79 Letter Agreement
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A-1 NS-MPG Inc. (formerly AT&T Phone Store) 7/19/90 Lease date
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2/1/96 Assignment
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A-2 Xxxxx Xxxxxx Formally Yours 7/18/88 Lease date
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3/8/93 Amendment
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A-3 Xx. Xxxxxx Xxxxx and Xxxxxx Xxxxx One Hour Photo 5/5/88 Lease date
------------------------------------------------------------------------------------------------------------------------------------
5/25/93 Amendment
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A-4 Xxxxxxx Xxx and Zwei-Hwa Xxx Xxxxxx Xxxxxxx 9/6/94 Lease
------------------------------------------------------------------------------------------------------------------------------------
A-5 World's Best Restaurant, Inc., II Bo-Bo's Gyros 5/1/92 Lease date
------------------------------------------------------------------------------------------------------------------------------------
5/14/93 Guaranty-Xxxxxx
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5/14/93 Assignment & Amendment
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8/16/94 Assignment & Second Amendment
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8/16/94 Guaranty-Xxxxx
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10/20/94 Extension Letter
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A-6 Systems Realty Corp. Great Frame Up 12/28/94 Lease date
------------------------------------------------------------------------------------------------------------------------------------
A-7 Tasty Thai, Inc. 2/10/94 Lease date
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A-8 Paddock Publications, Inc. Daily Herald 4/1/90 Lease date
------------------------------------------------------------------------------------------------------------------------------------
4/27/95 Amendment
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A-9 and A-10 Coldwell Banker-Residential Real Estate, Inc. 8/14/95 Lease date
------------------------------------------------------------------------------------------------------------------------------------
B-1 Xxxxxxx Xxxxxxx and Xxxxxxxxx Xxxxxxx Annie's Book Shop 2/9/93 Lease date
------------------------------------------------------------------------------------------------------------------------------------
10/11/95 Extension
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B-2 Norwest Financial Illinois, Inc. 6/24/91 Lease date
------------------------------------------------------------------------------------------------------------------------------------
B-3 Xxxxxx Xxxxxxxxxx, D.D.S. and Village Dental Clinic 6/1/88 Lease date
Xxxxx Xxxxxxx, D.D.S.
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B-4 Xxxxxxx & Associates, Inc. Mail Boxes, Etc. 9/11/85 Lease date
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9/1/91 Assignment & Amendment
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1/30/92 Lessor's Agreement
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10/31/95 Lease Extension
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B-5 Hair Depot, Ltd. 12/5/88 Lease date
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9/15/92 First Amendment
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12/25/93 Amendment
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C Walgreen Co. 12/20/78 Lease date
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2/27/79 Completion Letter
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8/31/95 Amendment
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D-1 and D-2 Pearle Vision, Inc. 8/26/88 Lease date
------------------------------------------------------------------------------------------------------------------------------------
8/6/93 Amendment
------------------------------------------------------------------------------------------------------------------------------------
E A&A Productions, Inc. Zanies of Xxxxxx Hills 8/11/92 Lease date
------------------------------------------------------------------------------------------------------------------------------------
9/1/92 License Agreement
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F-1 Rogo, Inc. Majestic Dry Cleaning 12/26/93 Lease date
------------------------------------------------------------------------------------------------------------------------------------
F-2 Petal Peddlers, Inc. 6/27/88 Lease date
------------------------------------------------------------------------------------------------------------------------------------
F-3 Systems Investments, Inc. Big Apple Bagels 4/25/95 Leae date
------------------------------------------------------------------------------------------------------------------------------------
9/1/95 Amendment
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F-4 Mundelein Burrito, Inc. El Famous Burrito 9/16/93 Lease date
------------------------------------------------------------------------------------------------------------------------------------
7/18/96
Page 1 of 1
69
SCHEDULE 2
LIST OF SERVICE CONTRACTS
HAWTHORN VILLAGE COMMONS
Vendor Service Provided Start Date
------ ---------------------------- ----------
Landscape Concepts Weekly Landscape Maintenance 4/15/96
Smithereen Monthly Extermination 6/1/96
Page 1 of 1 7/16/96
70
SCHEDULE 3
LIST OF LITIGATION
NONE
Page 1 of 1 7/18/96
