REINSTATEMENT AND SECOND AMENDMENT
TO AGREEMENT OF SALE AND ESCROW AGREEMENT
THIS REINSTATEMENT AND SECOND AMENDMENT TO AGREEMENT OF SALE AND ESCROW
AGREEMENT (this "Amendment") is made and entered into as of this 13 day of
June, 1996, by and between BALCOR REALTY INVESTORS 86-SERIES I A REAL ESTATE
LIMITED PARTNERSHIP, an Illinois limited partnership ("Seller"), SECURITY
CAPITAL PACIFIC TRUST, a Maryland real estate investment trust ("Purchaser"),
and CHARTER TITLE INSURANCE COMPANY ("Escrow Agent").
RECITALS:
A. Seller and Purchaser are parties to that certain Agreement of Sale,
dated as of May 6, 1996 ("Original Agreement"), pursuant to which Purchaser has
agreed to purchase and Seller has agreed to sell certain Property (as defined
in the Agreement) legally described and depicted on Exhibit A attached to the
Agreement.
B. Seller, Purchaser and Escrow Agent are parties to that certain Escrow
Agreement, dated as of May 6, 1996 ("Original Escrow Agreement"), pursuant to
which Purchaser has deposited funds in escrow to be held by Escrow Agent in
accordance with the terms of the Escrow Agreement.
C. Seller, Purchaser and Escrow Agent are parties to that certain First
Amendment to Agreement of Sale and Escrow Agreement dated as of May 31, 1996
("First Amendment"), pursuant to which certain provisions of the Original
Agreement and the Original Escrow Agreement have been amended. the Original
Agreement and the Original Escrow Agreement as amended by the First Amendment
are referred to herein as the "Agreement" and the "Escrow Agreement",
respectively.
D. Pursuant to the terms of the Agreement and the Escrow Agreement,
Purchaser terminated its obligations thereunder pursuant to the respective
terms thereof on June 12, 1996.
E. Seller and Purchaser desire to reinstate the Agreement and the Escrow
Agreement in accordance with the terms of this Amendment.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth and other good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, the parties hereby agree as
follows:
1. Notwithstanding that Purchaser has heretofore terminated the Agreement and
the Escrow Agreement pursuant to the respective terms thereof (the
"Termination"), the parties hereto agree that the Agreement and the Escrow
Agreement, are hereby reinstated and reestablished in full force and effect as
though the Termination had not occurred; provided, however, that the Agreement
and the Escrow Agreement shall be modified and amended as set forth
hereinbelow.
2. All terms not otherwise defined herein shall have the meanings ascribed to
each in the Agreement.
3. Except as amended hereby, the Agreement shall be and remain unchanged and
in full force and effect in accordance with its terms.
4. All references in the Agreement to the "Purchase Price" or to the sum
"$11,500,000.00" shall hereafter mean and be replaced by the sum
$11,150,000.00.
5. (a) Purchaser acknowledges that, except as set forth in Section 5(b) of
this Amendment, Purchaser waives any right afforded Purchaser under Paragraph
7.1 of the Agreement to terminate the Agreement based upon the results of
tests, studies, investigation, surveys and information received pursuant to
Paragraph 7.1 of the Agreement.
(b) Notwithstanding the foregoing subsection (a) or the provisions of
Paragraph 7.1 of the Agreement, Purchaser and Seller hereby agree that
Purchaser shall have until July 1, 1996 (the "Outside Date") to obtain the
release (the "Release") from the current holder of the beneficial interest (the
"Holder") of a certain Covenant to Grant Easement, dated March 19, 1985, and
recorded as Recorder's Fee No. 85012768 in the real property records of
Washington County, Oregon (the "Easement") of all right, title, interest and
claim that the Holder may have in or with respect to the Easement. In the
event that Purchaser is unable to obtain the Release on or before the Outside
Date, Purchaser shall have the right to notify Seller and Escrow Agent on or
before the Outside Date of its inability to obtain such release (the
"Notification"). Upon receipt of the Notification, (i) the Agreement and the
Escrow Agreement shall thereafter terminate, (ii) all Earnest Money theretofore
deposited by Purchaser with Escrow Agent, including all interest earned
thereupon shall immediately be returned to Purchaser and (iii) all obligations
of the Purchaser and Seller under the Agreement and the Escrow Agreement shall
terminate, with the exception of such obligations that by the terms of
Paragraph 7.1 of the Agreement are therein stated to survive a termination
pursuant to such Paragraph.
6. Paragraph 8 of the Agreement is hereby amended to read in its entirety as
follows:
"The closing of this transaction (the "Closing") shall be on the date (the
"Closing Date") that is seven (7) business days after Purchaser shall have
obtained a release (the "Release") (and provided to Seller) from the current
holder of the beneficial interest (the "Holder") of a certain Covenant to Grant
Easement, dated March 19, 1985, and recorded as Recorder's Fee No. 85012768 in
the real property records of Washington County, Oregon (the "Easement") of all
right, title, interest and claim that the Holder may have in or with respect to
the Easement, provided, however, that the Closing Date shall not be later than
July 10, 1996. The Closing shall be at the office of Title Insurer, in
Portland Oregon, at which time Seller shall deliver possession of the Property
to Purchaser, provided, however, that so long as Purchaser is not in default
hereunder, Purchaser shall have two (2) options to extend the Closing Date for
purposes of a 1031 Exchange (see Paragraph 18) to July 17, 1996 and August 16,
1996, respectively, by (a) giving written notice to Seller of the exercise of
the applicable option to extend no later than five (5) business days prior to
the then applicable Closing Date (as the same may have been extended) and (b)
depositing in each instance at least five (5) business days prior to the then
applicable Closing Date (as the same may have been extended) an amount equal to
Twenty-Five Thousand and No/100 Dollars with the Title Insurer, which sum(s)
shall be part of and included in the definition of "Earnest Money" and shall be
governed by the terms of the Escrow Agreement. This transaction shall be
closed through an escrow with Title Insurer, in accordance with the general
provisions of the usual and customary form of deed and money escrow for similar
transactions in Oregon, provided, however, that in any instance, the sale
proceeds shall not be disbursed from such escrow unless and until the Title
Insurer shall be unconditionally committed to issuing the Title Policy. All
closing and escrow fees shall be divided equally between the parties hereto."
7. (a) Paragraph 2 of the Escrow Agreement is hereby amended and restated to
read in its entirety as follows:
"On or before July 1, 1996 Purchaser may deliver to Escrow Agent a notice
in the form of Schedule 1 attached hereto that Purchaser has elected to
terminate the Agreement pursuant to the terms of that certain Second Amendment
to Agreement of Sale and Escrow Agreement dated as of June 13, 1996 (the "Due
Diligence Termination Notice"). In the event that Purchaser shall deliver to
Escrow Agent the Due Diligence Termination Notice on or before July 1, 1996,
Escrow Agent shall promptly deliver to Purchaser the Earnest Money, together
with all interest earned thereon, and thereafter this Escrow Agreement shall be
null and void."
(b) Paragraph 3 of the Escrow Agreement is hereby amended and restated to
read in its entirety as follows:
"The Closing Date shall be the date established pursuant to Paragraph 8 of
the Agreement. Unless terminated pursuant to Paragraph 2 above, on the Closing
Date, or at such other date as Seller and Purchaser may, in writing, advise
Escrow Agent, Escrow Agent shall deliver all funds then held in the escrow to
Seller. However, if Purchaser has delivered an Affidavit of Seller's Default
to Escrow Agent, on or before the Closing Date, in substantially the form of
Schedule 2, subscribed and sworn to by Purchaser, specifying in detail the
default or defaults of Seller, then Escrow Agent shall not deliver the funds to
Seller, but shall continue to hold the funds until advised in writing by both
Seller and purchaser or until directed by judicial order to disburse the
funds."
8. The Purchaser hereby directs the Escrow Agent that the funds together with
interest thereon (if any) that were (i) heretofore deposited with Escrow Agent
by Purchaser and (ii) subsequently directed to be returned to Purchaser
pursuant to the Termination, shall be held as, and shall constitute, the
Earnest Money, as provided in the Agreement and the Escrow Agreement.
9. This Amendment may be executed by facsimile and in counterparts, each of
which shall be deemed an original, but all of which, when taken together shall
constitute one and the same instrument.
[EXECUTION PAGE TO FOLLOW]
IN WITNESS WHEREOF, the parties have executed this Amendment as of the
date first set forth above.
PURCHASER:
SECURITY CAPITAL PACIFIC TRUST, a Maryland
real estate investment trust
By: /s/ Anthony R. Arnest
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Name: Anthony R. Arnest
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Its: Vice President
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SELLER:
BALCOR REALTY INVESTORS 86 SERIES I A REAL
ESTATE LIMITED PARTNERSHIP, an Illinois
limited partnership
By: Balcor Partners-XIX, an Illinois general
partnership, its general partner
By: The Balcor Company, a Delaware
corporation, a general partner
By: /s/ Phillip Schechter
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Name: Phillip Schechter
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Its: Authorized Agent
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ESCROW AGENT:
CHARTER TITLE INSURANCE COMPANY
By:
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Name:
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Its:
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