KAYE, SCHOLER, FIERMAN, HAYS & HANDLER
425 PARK AVENUE
NEW YORK, N.Y. 10022-3598
---
(212) 836-8000
November 15, 1994
Writer's direct dial number
(212) 836-8596
VIA FEDERAL EXPRESS AND FAX
---------------------------
Mr. Stuart Nathan
JMB Realty Corporation
900 North Michigan Avenue, Suite 1900
Chicago, IL 60611
Re: 125 Broad Street Company
------------------------
Dear Stuart:
Enclosed are executed originals of the following documents:
(a) Promissory Note (one original) dated October 31, 1994
made by O&Y Equity Company, L.P. ("Equity") and O&Y (U.S.)
Development Company, L.P. ("Devco") to JMB/125 Broad Building
Associates, L.P. ("JMB") in the principal amount of $5,000,000; and
(b) Release and Indemnity (two originals) dated October 31,
1994 from Equity and Devco.
I am concurrently delivering to O&Y the executed originals of
the following documents, which are also dated October 31, 1994, and
copies of which are enclosed for your files:
(i) Assignment of Partnership Interest from JMB to O&Y Plaza
Corp. ("O&Y"); and
(ii) Release from JMB, JMB/125 Broad Building Associates and
JMB Realty Corporation.
KAYE, SCHOLER, FIERMAN, HAYS & HANDLER
Mr. Stuart Nathan 2 November 15, 1994
Accordingly, the transfer of JMB's interest in 125 Broad
Street Company to O&Y has been consummated.
Sincerely,
BARRY P. MARCUS
--------------------
Barry P. Marcus
Enclosure:
cc: Corinne Ball, Esq.
Richard Beltram
Lee Ann Duffy, Esq.
David King
Paul Leake, Esq.
Leo J. Pircher, Esq.
Jeffrey Rosenthal
Andrew P. Siedman, Esq.
Joel Simon
Lary S. Wolf, Esq.
Scott Zucker, Esq.
PROMISSORY NOTE
---------------
$5,000,000 New York, New York
October 31, 1994
FOR VALUE RECEIVED 0&Y Equity Company, L.P. and O&Y (U.S.)
Development Company, L.P., each a Delaware limited partnership
(individually and together hereinafter called "Maker"), hereby
promise to pay to the order of JMB/125 Broad Building Associates,
L.P., an Illinois limited partnership (hereinafter called "Payee"),
at 900 North Michigan Avenue, Chicago, Illinois 60611, or at such
other place as Payee or any holder of this Note may from time to
time designate, the principal sum of Five Million Dollars
($5,000,000), together with interest at the Interest Rate (as
hereinafter defined), in lawful money of the United States, on the
Maturity Date (as hereinafter defined). Interest shall be computed
on the basis of a 365-day or 366-day year, as the case may be.
The following capitalized terms are defined as follows for
purposes of this Note:
"Interest Rate" shall mean 4.5% per annum simple interest;
provided however, that if O&Y Equity Company, L.P. ("Equityco")
executes and delivers to Canadian Imperial Bank of Commerce
("CIBC") a promissory note (which note, as it may be amended from
time to time, and/or any separate standstill, forbearance or
similar agreement (a "Standstill Agreement") relating thereto, is
herein referred to as the "CIBC Note") in settlement of Equityco's
obligations to CIBC under two Guarantee Agreements dated as of June
25, 1987 given by Equityco to CIBC in connection with the mortgage
loan made by CIBC to 125 Broad Street Company, then the "Interest
Rate" shall thereafter be equal to the greater of 4.5% per annum
simple interest or the interest rate under the CIBC Note.
"Maturity Date" shall mean October 31, 1999; provided,
however, that if the CIBC Note is executed and delivered, then the
"Maturity Date" shall be the earlier of (i) maturity date under the
CIBC Note or (ii) December 31, 1999.
Maker may, at its option, at any time and from time to time,
prepay all or any part of (i) the interest accrued and unpaid under
this Note ("Unpaid Interest"), or (ii) the unpaid principal balance
of this Note ("Unpaid Interest"), together with all Unpaid Interest
accrued thereon. Each such partial prepayment shall be applied
first to Unpaid Interest and then to Unpaid Principal. If the CIBC
Note is executed and delivered, then Maker shall make a mandatory
prepayment (a "Required Prepayment") on account of Unpaid Interest
and/or Unpaid Principal on each date on which a payment of interest
and/or principal is paid under the CIBC Note (a "CIBC Payment"),
which Required Prepayment shall consist of and be in an amount
equal to the sum of (i) the Unpaid Interest multiplied by a
percentage that is equal to the percentage that such CIBC Payment
of accrued and unpaid interest constitutes of the total accrued and
unpaid interest on the CIBC Note on each such date plus (ii) the
Unpaid Principal multiplied by a percentage that is equal to the
percentage that such CIBC Payment of principal constitutes of the
total outstanding principal of the CIBC Note on each such date.
For purposes of the foregoing, a CIBC Payment shall be deemed to
have been made at the time it was to have been due and payable if
the holder of the CIBC Note agrees (other that in a Standstill
Agreement Delivered at the time the CIBC Note is first delivered)
to a deferral of such CIBC Payment (a "CIBC Deferral"), unless
Maker gives to Payee, on or before such date, consideration
equivalent and proportionate to the consideration (if any) given to
the holder of the CIBC Note (the "CIBC Consideration") to obtain
such deferral (it being understood that such consideration to be
given to Payee shall be in an amount that bears the same proportion
to the deferred Required Prepayment as the CIBC Consideration bears
to the deferred CIBC Payment).
Maker shall deliver to Payee (i) copies of all financial
statements and other informational materials that Maker delivers to
the holder of the CIBC Note pursuant thereto, at the same times as
such deliveries are made to such holder, and (ii) copies of the
CIBC Note (and any amendments thereto and any separate Standstill
Agreement relating thereto) and notice of any CIBC Deferral
promptly after delivery of any thereof.
If the CIBC Note is not executed and delivered, then for
purposes hereof, all references herein to the CIBC Note shall refer
instead to the note first executed and delivered after the date
hereof by Maker, or either of the parties comprising Maker, to a
commercial bank (or, at Payee's option, another entity that is not
an "Affiliate" of Maker (as such quoted term is defined in the
Draft Plan hereinafter referred to)), to evidence an unsecured
recourse claim (including deficiency claim that is subsequently
liquidated as unsecured) against such party that arose from an
extension of credit or other loan accommodation (as such note may
be amended from time to time, together with any separate Standstill
Agreement relating thereto).
By its acceptance of this Note, Payee agrees that it will not
oppose, directly or indirectly, a plan of reorganization of Maker
(or either party comprising Maker) under Chapter 11 of the
Bankruptcy Code (as defined in the Draft Plan) which provides that
the reorganized debtor to its successor will emerge from Chapter 11
with (i) the obligation to pay the Debt in full over a term and in
a manner that is at least as favorable to Payee as the terms
hereof, and (ii) Maker's obligations under the release and
Indemnity dated this date from Maker to Payee.
2
Payee may, at its option, declare the entire Unpaid Principal
and all Unpaid Interest (the "Debt") to be immediately due and
payable upon (i) the commencement by Maker of a case under the
Bankruptcy Code, or under any other applicable federal or state
bankruptcy law or other similar law (which, is in the case of an
involuntary proceeding, is not contested or is not set aside within
120 days); (ii) the appointment of a trustee or receiver of all or
a substantial part of the property then owned by Maker; (iii) an
assignment for the benefit of creditors by Maker; or (iv) the
failure by Maker to make any Required Prepayment within ten
business days after the due date therefor.
After maturity (by acceleration or otherwise), and both before
and after judgment, the unpaid principal balance of this Note, and
interest accrued thereon, shall bear interest at an annual rate
equal to (i) the greater of 7.5% or the "Default Rate" under the
CIBC Note (if entered into), or (ii) the maximum rate permitted by
law, whichever is less. Such interest shall be computed on the
basis of a 365-day or 366-day year, as the case may be.
No remedy of Payee if exclusive of any other remedy provided
herein or at law, and all remedies available to Payee shall be
cumulative.
Maker hereby waives diligence, demand, presentment, protest
and notice of any kind, and assents to extensions of the time of
payment, releases, or forbearance or other indulgence, without
notice.
This Note may note be changed, modified or terminated orally,
but only by an agreement in writing signed by the party to be
charged.
The obligations of the parties constituting Maker hereunder
shall be joint and several.
Maker represents and warrants to Payee that the CIBC Note
referred to herein is the same as the "Equityco Note" referred to
in the draft Plan of Reorganization for 125 Broad Street Company,
a copy of which has been delivered to Payee (the "Draft Plan").
3
IN WITNESS WHEREOF, Maker has executed this Note as of
the date first above written.
O&Y EQUITY COMPANY, L.P.
By: O&Y Equity General Partner Corp.,
General Partner
By: JOEL M. SIMON
--------------------
Name:Joel M. Simon
Title:Executive Vice President
O&Y (U.S.) DEVELOPMENT COMPANY, L.P.
By: O&Y (U.S.) Development General
Partner Corp., General Partner
By: JOEL M. SIMON
--------------------
Name:Joel M. Simon
Title:Executive Vice President
4
RELEASE AND INDEMNITY
---------------------
O&Y Equity Company and O&Y (U.S.) Development Company, L.P.,
each a Delaware limited partnership (individually and together
"O&Y"), for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, jointly and severally
agree as follows:
1. O&Y does hereby release and discharge JMB/125 Broad
Building Associates, L.P. ("JMB"), an Illinois partnership, JMB/125
Broad Building Associates, and Illinois general partnership
("JMB/125") and their respective successors, those persons,
corporations, partnerships or other entities that are former or
present partners in JMB, JMB/125 or such successors, all direct and
indirect owners or partners of such partners, JMB Realty
Corporation, an Illinois corporation ("JMB Corp."), and its
successors and direct and indirect owners, and all officers,
directors, attorneys and other agents of any of the foregoing
(collectively, "Releasees"), from all actions, causes of action,
suits, debts, dues, sums of money, accounts, reckonings, bonds,
bills, specialties, controversies, variances, trespasses, damages
judgments, executions, claims and demands whatsoever in law or
equity against Releasees, or any of them, which O&Y ever had, now
has or hereafter can, shall or may have for, upon or by reason of
any matter, cause or thing whatsoever arising out of or relating to
any matter, fact or thing, existing from the beginning of the world
to the date hereof, arising out of or in any way relating to 125
Broad Street Company, a New York limited partnership ("125 Broad
Co.") or the assets or liabilities thereof or JMB's or JMB/125's
former interest therein, including without limitation, matters
arising out of or in any way relating to (i) the Second Amended and
Restated Agreement of Limited Partnership of 125 Broad Co. dated
December 31, 1985, as amended (the "Partnership Agreement"), or
(ii) the Basic Agreement (as such term is defined in the
Partnership Agreement); except that nothing herein shall release
JMB from its obligations under that certain Assignment of
Partnership Interest dated this date (the "Assignment") from JMB to
O&Y Plaza Corp.
2. O&Y hereby agrees to indemnify, defend and hold harmless
Releasees from and against all liabilities and obligations of 125
Broad Street Company, a New York limited partnership (the
"Partnership"), whether arising before or after the delivery of the
Assignment, except liabilities and obligations existing as a result
of any inaccuracies in JMB's representations and warranties in the
Assignment.
3. O&Y Equity Company, L.P. ("Equity") hereby represents and
warrants to JMB that the Plan of Reorganization and Disclosure
Statement that will first be proposed by Equity and the Partnership
in the contemplated commencement by the Partnership of a case under
Chapter 11 of the United States Bankruptcy Code will be the same in
all respects materially affecting JMB as the drafts of such Plan of
Reorganization and Disclosure Statement most recently delivered to
JMB or its counsel prior to the delivery of the Assignment;
provided, however, that if such proposed Plan of Reorganization or
Disclosure Statement is not approved, confirmed and consummated,
neither O&Y nor the Partnership shall have any liability or
obligation to JMB as a result thereof or in connection with the
proposal by O&Y, the Partnership or any other person or entity,
and/or the approval, confirmation and consummation, of a different
Plan of Reorganization and/or Disclosure Statement.
4. If any provision of this Release and Indemnity or the
application thereof to any circumstance shall be invalid or
unenforceable to any extent, the remaining provisions hereof shall
not be affected thereby and shall remain valid and enforceable to
the fullest extent permitted by law.
IN WITNESS WHEREOF, O&Y has caused this Release and Indemnity
to be duly executed October 31, 1994.
O&Y EQUITY COMPANY, L.P.
By: O&Y Equity General Partner Corp.,
General Partner
By: JOEL M. SIMON
----------------------
Name: Joel M. Simon
Title: Executive Vice President
O&Y (U.S.) DEVELOPMENT COMPANY, L.P.
By: O&Y (U.S.) Development General
Partner Corp., General Partner
By: JOEL M SIMON
---------------------
Name: Joel M. Simon
Title: Executive Vice President
ASSIGNMENT OF PARTNERSHIP INTEREST
----------------------------------
THIS ASSIGNMENT OF PARTNERSHIP INTEREST is made as of October
31, 1994, by JMB/125 BROAD BUILDING ASSOCIATES, L.P. an Illinois
limited partnership, having an office at 900 North Michigan Avenue,
Chicago, Illinois 60611 ("Assignor"), to O&Y PLAZA CORP., a
Delaware corporation, having an office at 237 Park Avenue, New
York, NY 10017 ("Assignee").
WITNESSETH, THAT:
For good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by Assignor, Assignor
hereby unconditionally assigns, transfers and sets over to claims
against that certain New York limited partnership (the
"Partnership") known as 125 Broad Street Company, including,
without limitation, Assignor's 48.2467039% interest as a general
partner in the Partnership and Assignor's 48.2467039% interest in
the profits, losses, gains, deduction, credits and distributions of
the Partnership (all of the foregoing being collectively referred
to herein as the "Partnership Interest").
Assignor hereby withdraws as a partner in the Partnership.
Assignor hereby represents and warrants to Assignee that: (i)
Assignor has the requisite power and authority to execute and
deliver this Assignment and has obtained all consents and
permissions required for such execution and delivery; (ii) this
Assignment has been duly and validly authorized, executed and
delivered by Assignor and is binding upon and enforceable against
Assignor; and (iii) Assignor is conveying to Assignee hereunder
good title to, and the entire right, title and interest in, the
Partnership Interest, free and clear of any liens, encumbrances,
claims, liabilities, rights, demands, exceptions, agreements,
covenants and restrictions of any kind or character, including but
not limited to, any security interests or any restriction on sale
or assignment, or any option, right or agreement for the purchase
or acquisition of the same or of any interest in the same, except
as expressly set forth in the partnership agreement of the
Partnership (including, but not limited to, the security interest
therein set forth) and except for any liability that all general
partners in the Partnership have by virtue of their status as
general partners.
At Assignee's request, Assignor shall execute, acknowledge and
deliver such documents and instruments, and take such other
actions, as may be necessary or reasonably required to fully
effectuate and confirm the transfer and assignment of the
Partnership Interest and Assignor's withdrawal as a partner in the
Partnership as contemplated hereby; provided Assignor does not
thereby incur any new obligation or liability.
This Amendment shall be binding upon Assignor and its
successors and assigns and shall inure to the benefit of Assignee
and its successors and assigns.
IN WITNESS WHEREOF, Assignor has executed this Assignment as
of the date first above written.
JMB/125 BROAD BUILDING ASSOCIATES, L.P.
By: Carlyle Advisors, Inc.
General Partner
By: STUART NATHAN
---------------------------
President
RELEASE
JMB/125 Broad Building Associates, L.P., an Illinois limited
partnership ("JMB LP"), JMB/125 Broad Building Associates, an
Illinois General partnership ("JMB/125"), and JMB Realty
Corporation, an Illinois corporation, on behalf of itself and its
wholly-owned subsidiaries ("JMB") (JMB LP, JMB/125 and JMB,
collectively and individually, "Releasor"), for good and valuable
consideration, the receipt and sufficiency of which are hereby
acknowledged,
Now DO HEREBY RELEASE AND DISCHARGE:
O&Y Equity Company, L.P., a Delaware limited partnership
("Equityco"), O&Y (U.S.) Development Company, L.P., a Delaware
limited partnership ("Devco"), 125 Broad Street Company, a New York
limited partnership ("125 Broad Co."), those persons, corporations,
partnerships or other entities that are former or present partners
in Equityco, Devco or 125 Broad Co., all direct and indirect owners
or partners of such partners, and O&Y Management Corp., a New York
corporation (collectively, "Releasees"), in addition to the
officers, directors, and successors in interest of Releasees, or
any of them, from all actions, causes of action, suits, debts,
dues, sums of money, accounts, reckonings, bonds, bills,
specialties, controversies, variances, trespasses, damages,
judgments, executions, claims and demands whatsoever in law or
equity against Releasees, or any of them, which Releasor ever had,
now has or hereafter can, shall or may have for, upon or by reason
of any matter, cause or thing whatsoever, existing from the
beginning of the world to the date hereof, arising out of or in any
way relating to 125 Broad Co. or the assets or liabilities thereof
or Releasor's interest or former interest therein, including
without limitation, matters arising out of or in any way relating
to (i) the Second Amended and Restated Agreement of Limited
Partnership of 125 Broad Co. dated December 31, 1985, as amended
(the "Partnership Agreement"), or (ii) the Basic Agreement, the
Management Agreement, the Development Guaranty or the Takeover
Agreement Assignment (as such terms are defined in the Partnership
Agreement); except that nothing herein shall release Equityco or
Devco from their obligations under (i) that certain Promissory Note
dated this date made by Equityco and Devco to JMB LP in the
principal amount of $5,000,000 or (ii) that certain Release and
Indemnity dated this date given by Equityco and Devco to JMB LP.
IN WITNESS WHEREOF, Releasor has caused this Release to
be duly executed October 31, 1994.
JMB/125 Broad Building Associates, L.P.
By: Carlyle Advisors, Inc.,
General Partner
By: STUART NATHAN
-------------------------------
Name: Stuart Nathan
Title: President
JMB/125 Broad Building Associates
By: Carlyle Real Estate
Limited Partnership - XV,
General Partner
By: JMB REALTY CORPORATION
General Partner
By: STUART NATHAN
--------------------------
Name: Stuart Nathan
Title: Executive Vice President
JMB Realty Corporation
By: STUART NATHAN
-----------------------------
Name: Stuart Nathan
Title:Executive Vice President