UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) August 19, 2005
CONSOLIDATED CAPITAL PROPERTIES VI
(Exact name of Registrant as specified in its charter)
California 0-14099 94-2940204
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation or File Number) Identification Number)
organization)
55 Beattie Place
Post Office Box 1089
Greenville, South Carolina 29602
(Address of principal executive offices)
(864) 239-1000
(Issuer's telephone number)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligations of the registrant under any of the
following provisions:
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17
CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 1.01 Entry into a Material Definitive Agreement.
Consolidated Capital Properties VI (the "Registrant"), a California limited
partnership, owns a 100% interest in Colony of Springdale Associates, Ltd., a
Texas limited partnership (the "Partnership"). The Partnership owns Colony of
Springdale Apartments, a 261-unit apartment complex located in Springdale, Ohio
("Colony of Springdale"). On August 19, 2005, the Registrant and nine other
partnerships that own apartment complexes containing a total of 2,215 units (the
"Selling Partnerships"), entered into a Purchase and Sale Contract (the
"Purchase Agreement") with a third party, CNC Investments, Ltd, LLP, a Texas
limited liability partnership, (the "Purchaser") to sell the ten apartment
complexes owned by the Selling Partnerships to the Purchaser for a total sales
price of $96,500,000, of which $10,400,000 represents the sales price allocation
to Colony of Springdale. Each of the selling entities is affiliated with AIMCO
Properties, L.P., an affiliate of the general partner of the Partnership.
The following is a summary of the terms and conditions of the Purchase
Agreement, which summary is qualified in its entirety by reference to the
Purchase Agreement, a copy of which will be filed with the Registrant's Form
10-QSB for the quarterly period ended September 30, 2005.
PURCHASE PRICE. The total purchase price is $96,500,000, of which $10,400,000
represents the sales price allocation to Colony of Springdale, subject to
certain prorations and adjustments at the closing. The Purchaser delivered an
initial deposit of $500,000. The Partnership is allocated approximately $54,000
of the initial deposit. On the day that the feasibility period expires, the
Purchaser is required to deliver an additional deposit of $500,000. The
Partnership is allocated approximately $54,000 of the additional deposit. Both
the initial and the additional deposit are nonrefundable unless a refundable
event occurs as defined in the Purchase Agreement. In addition to the purchase
price, there shall be an aggregate portfolio acquisition fee of $2,000,000 to be
paid by Purchaser, of which $217,000 is allocated to the Partnership. At
closing, upon receipt of the purchase price and the portfolio acquisition fee,
The Selling Partnerships will pay an acquisition fee to Investors Commercial
Corporation, an unaffiliated third party, of $2,000,000. The Partnership is
allocated $217,000 of this acquisition fee. The Purchaser has elected not to
assume the mortgage encumbering Colony of Springdale but rather to cause such
indebtedness to be prepaid, and as such the Purchaser will be responsible for
all fees and expenses charged in connection with the prepayment of the mortgage.
Such fees and expenses are subject to reduction from the purchase price.
CLOSING. The closing of the sale is 60 days after the effective date ("Closing
Date"). The Selling Partnerships have the right to extend the Closing Date for
up to thirty days to satisfy any condition to closing, or such later date as is
mutually acceptable to both parties. The Purchaser has the right to extend the
Closing Date one time for up to 30 days by delivering written notice and a
nonrefundable extension deposit of $250,000 to the Selling Partnerships no later
than 15 days prior the Closing Date. The Partnership is allocated approximately
$27,000 of the extension deposit. The closing is also subject to customary
closing conditions and deliveries. The anticipated closing date for the
transaction is October 18, 2005.
COSTS AND FEES. With respect to Colony of Springdale, the Purchaser will pay its
legal fees, recording costs, any premiums or fees required to be paid with
respect to the title policy and one-half of the customary closing costs of the
escrow agent. The Partnership will pay the base premium for its title policy,
the costs of recording any instruments required to discharge any liens or other
monetary encumbrances against Colony of Springdale, its legal fees and one-half
of the customary closing costs of the escrow agent relating to Colony of
Springdale. The Selling Partnerships and the Purchaser will share equally any
transfer, sales, use, gross receipts or similar taxes and the existing survey.
REPRESENTATIONS AND WARRANTIES. The Selling Partnerships and the Purchaser each
made limited representations and warranties to the other.
RISK OF LOSS. The risk of loss or damage to the ten apartment complexes by
reason of any insured or uninsured casualty during the period through and
including the closing date will be borne by the respective Selling Partnerships.
The respective Selling Partnerships must maintain all of their existing
insurance coverage on the ten apartment complexes in full force and effect until
the closing date.
ASSIGNMENT. With the exception of an assignment to an affiliate of the
Purchaser, the Purchase Agreement is not assignable by the Purchaser without
first obtaining the prior written approval of the Selling Partnerships.
DEFAULTS AND REMEDIES. If the Purchaser defaults in its obligations to deliver
when required any required deposits, the purchase price or any other specified
deliveries, then, immediately and without notice or cure, the Purchaser shall
forfeit such deposits to the Selling Partnerships, and neither party shall be
obligated to proceed with the purchase and sale of the five apartment complexes.
The Selling Partnerships expressly waive the remedies of specific performance
and additional damages for any such defaults by the Purchaser.
If the Selling Partnerships, prior to the closing, default on their
representations, warranties, covenants, or obligations, the Purchaser has the
option of (i) seeking specific performance of the Selling Partnerships'
obligation to deliver the deed pursuant to the Purchase Agreement (ii)
terminating the Purchase Agreement, having returned any deposits made by the
Purchaser, and recovering, as its sole recoverable damages its documented direct
and actual out-of-pocket expenses and costs in an amount not to exceed $20,000
per Selling Partnership.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
CONSOLIDATED CAPITAL PROPERTIES VI
By: CONCAP EQUITIES, INC.
General Partner
By: /s/Martha L. Long
Martha L. Long
Senior Vice President
Date: August 25, 2005